When Bloomberg bought BusinessWeek last December (and I left), the economics looked simple: A news organization with a successful subscription-based business model took over a failing magazine with a broken advertising-based model. Bloomberg made money. We lost it. They ate us. But this notion is false. Bloomberg news does not make money. It is not a winning business model. It is bundled into a wildly profitable data service that 300,000 traders and financial pros around the world view as essential. And when they pay their $20,000 a year to rent their Bloomberg terminals, they get the news service, which is very good. But if the news were unbundled from the data feed, how much would those subscribers pay for the news? We'll never know. But I would bet it would not be enough to sustain the global behemoth with more than 2,000 reporters. In a sense, Bloomberg news is like Microsoft's browser, the Internet Explorer. It's bundled into a fabulously profitable operating system but would be hard pressed to turn a profit on its own.

Why does this matter to BusinessWeek? The terminal, which makes all the money, ties BusinessWeek to a legacy. Anything that threatens that core business cannot be tolerated. At a time when print journalism needs innovation, Bloomberg BusinessWeek is shackled. This is most evident in social media. As I mentioned last fall, blogging and crowd-sources stories hardly fit with the needs of the terminal, whose franchise is built upon the speed and authority of its data and news. And since Bloomberg took over, ventures in social media at the magazine have withered, as has the entire Web site. (The BusinessWeek iPhone app, last time I looked, provided little more than a feed of Bloomberg wire stories.) Skeptics can pooh pooh social media. It's certainly not gushing money at other mainstream pubs. But it is a source of experimentation and innovation. It's where potential readers are spending loads of time, and where they tell their friends what to look at. However, at Bloomberg Businessweek, the push is to make the paper magazine a must-read. To that end, Bloomberg has brought in top editors from Time and Fortune. This paper push is itself is an experiment, and every bit as wild, in 2010, as wikis. I don't have high hopes.