The reason? The US government no longer wants news organizations that participate in so-called “lock-ups” to able to profit from their early access by potentially selling high-speed data to their clients.
“It is my obligation to do everything possible to protect the integrity of our data, as it is collected, analyzed, and distributed,” said William Beach, Commissioner of the Labor Department in a letter Thursday.
Since the 1980s, the Labor Department has allowed news organizations to bring computers into secured government rooms that are cut off from the Internet for a set period of time — sometimes up to an hour– before the government’s economic data is released to the public.
The federal government took up the practice of providing pre-release access to journalists in order to ensure that news reports would be accurate given their complex information. The extra time affords reporters the ability to analyze and ask questions as they prepare stories that are immediately filed for the public to read.
The basis of the decision relies in part on a July 2014 Inspector General report found that the pre-early access “unintentionally creates an unfair competitive advantage for certain news organizations and their clients.”
The Obama administration took steps to tighten security and even considered doing away with such practices, but those efforts faced opposition by Congress.
The IG’s report said without naming specific news organizations that several outlets that participate in the Labor Department press lock-up are able “to profit from their presence in the lock-up by selling to traders, high-speed data feeds of economic data formatted for computerized algorithmic trading.”
Because of their pre-release access, “they are able to load the data… allowing their clients to get this information faster than the public,” the report added.
Bloomberg is one of the news organizations known for packaging government data for wealthy clients. Its founder, Michael Bloomberg, is running for president against President Donald Trump.
A representative from Bloomberg did not respond to a request for comment from CNN.
The Society for Advancing Business Editing and Writing, which represents 3,000 business and financial journalists in North America, said the move will “impede quality journalism” and gives an advantage to high-frequency traders who can use algorithms to get information from government websites ahead of investors and the public.
“This limits journalist ability to produce immediate, complete available-to-all reporting on government releases of economic data,” the statement said.
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