Exclusive: Goldman leads investment by Wall Street in new communications platform
By Lauren Tara LaCapra
NEW YORK (Reuters) - After spending two years developing a wide-ranging communications tool for Wall Street, Goldman Sachs Group Inc says it has reached the perfect pitch.
On Wednesday, Goldman and 13 partners plan to announce a $66 million investment in a new company called Symphony Communication Services Holdings LLC, according to a draft press release viewed by Reuters. The partners are all financial services firms, including major global banks and asset managers.
Symphony, led by chat industry veteran David Gurle, will allow financial firms, corporate customers and individuals to put all of their digital communications on one centralized platform. Chat messages, texts, emails and tweets will no longer have to exist in separate silos.
The platform is "open source," which means its users can take the code inside the guts of the technology and alter it for their unique needs. They can add "widgets" for areas like trading, research and internal data.
"We recognized that messaging was a complex problem to solve in our industry," Darren Cohen, global co-head of principal strategic investments at Goldman Sachs, said in a joint interview with Gurle this week. "It's the core nervous system of the financial markets, but there are information silos that don't speak to each other. So, we started to think strategically about creating one platform that allowed the silos to communicate effectively, and then taking that platform to clients and external users."
Symphony represents a threat to existing data and communications networks on Wall Street, including those run by Bloomberg LP, Thomson Reuters Corp and Markit Ltd. Thomson and Markit have also been jointly developing an "open-source" chat platform. It is unclear how widely Symphony will be adopted, though Goldman already has about 23,000 employees using the system internally, exchanging millions of messages each week.
The Goldman-Gurle partnership has been widely seen as an attempt to upend Bloomberg's messaging and chat platform, known as Instant Bloomberg, which is widely used on Wall Street. Some also view the project as an extension of the battle between Bloomberg and Goldman last year, when the bank was upset to discover that Bloomberg reporters had access to client information, such as when employees were logged into terminals. Bloomberg subsequently removed the access.
But sources involved with the investment and Goldman employees who have used Symphony say it is more than a simple chat or messaging program, and that the partnership was not conceived in retaliation to what became known as the Bloomberg "spying" scandal. Continued...