Business Wire to Issue News Releases in Real Time to All Sources - TheStreet

Business Wire to Issue News Releases in Real Time to All Sources

The move comes as news organizations and data providers increasingly rush to provide almost instantaneous news and numbers. But the demand for speed has its pitfalls.
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Business Wire

, a carrier of corporate press releases, is ending the 15-minute jump that financial news wires have on the news, the company said Monday.

Citing recent regulations by the

Securities and Exchange Commission

governing selective disclosure of corporate information, the company said it would soon eliminate the policy that kept financial news portals, Web sites and databases waiting 15 minutes after the wire services received press releases.

It also said its Web site, www.businesswire.com, would begin distributing news releases in real time by month's end.

"The popularity of such sites as

Yahoo!

,

America Online

and others confirm that individual investors are eager to tap corporate news," said Cathy Baron Tamraz,

Business Wire's

chief operating officer, in a statement. She and Lorry Lokey, the company's founder, did not immediately return calls for comment.

"With the recent passage of Regulation FD by the U.S. Securities and Exchange Commission," she said, "the clear message from the SEC is that all investors should have equal access to all information that may influence their investment decisions."

Renu K. Aldrich, a spokeswoman for rival

PRNewswire

, said the company was reviewing its policies but has no plans to match the announcement. "As of this moment, no, we are not changing anything," she said.

John Heiny, a spokesman for the SEC, did not immediately return calls for comment.

The move by

Business Wire

comes as news organizations and data providers increasingly rush to provide almost instantaneous news and numbers. But the demand for speed has its pitfalls.

Last month, a

false press release about

Emulex

(EMLX)

first appeared on

Internet Wire

, an Internet-based distributor of corporate news, causing a huge selloff in the company's shares before the hoax was disclosed.

In a way,

Business Wire's

decision emulates ones made by other data providers. In July, for example, the

New York Stock Exchange

and the

Nasdaq Stock Market

said they were planning to offer real-time quotations on their Web sites, placing themselves in a race against many of their customers to offer investors immediate access to raw data.

Matthew Winkler, editor in chief of

Bloomberg News

, noted that a similar system is in place for news involving companies listed on the

London Stock Exchange

.

"I'm all for empowering companies to be able to say whatever they want to their investors," Winkler said. But, he added, "I don't think there's ever any substitute for news judgment.

Dick Tofel, vice president of corporate communications at the

Dow Jones News Service

, said he doubts the decision will help or hinder investors.

"I wouldn't want to say that raw press releases have no value because they have some," he said. He said real-time media outlets, including

Dow Jones

and financial news Web sites, add value for investors by identifying the real news in corporate news releases and by adding context.

Nancy Bobrowitz, senior vice president for corporate communications for

Reuters

, said her news service hasn't had a chance to evaluate what the impact of

Business Wire's

would be.

"Our news is already available on more than 900 Web sites," she said. "Our journalists add a lot of value by going behind the headlines."