Outsource, baby, outsource!

October 21, 2008

Reading newspapers at Martin Place in central SydneyAiling ad sales? Restive workers? Colossal costs? If your media company is experiencing one or more of the above symptoms, try outsourcing. While the long-term side effects are not yet known, outsourcing is proving to be an increasingly popular remedy for media companies looking to buff up their balance sheets.

The latest one — and potentially a harbinger for others in U.S. media companies — is MediaNews Group, the privately held, Colorado-based newspaper publisher run by “Lean” Dean Singleton.

Here is his latest comment on outsourcing, as covered by The Associated Press:

Singleton, who also serves as chairman of the board of The Associated Press, told the Southern Newspaper Publishers Association that his company was exploring outsourcing in nearly every aspect of their operations.

“In today’s world, whether your desk is down the hall or around the world, from a computer standpoint, it doesn’t matter,” Singleton said after his speech. … Singleton said sending copy editing and design jobs overseas may even be called for. “One thing we’re exploring is having one news desk for all of our newspapers in MediaNews … maybe even offshore,” he said during the speech.

The AP article notes that few news outlets have sent newsroom functions to other countries, limiting “offshoring” to mostly ad production and non-editorial functions. Of course, the AP also points out:

Notable exceptions are Thomson Reuters, which has been using journalists in Bangalore, India, to handle some basic news such as corporate earnings reports, and a Web site called pasadenanow.com, which has five regular contributors overseas who write about Pasadena, Calif., using webcasts of council meetings and information provided by citizen volunteers.

As the financial crisis continues to depress media stocks and debt, and ratchets up the pressure to trim more costs, don’t be surprised to read more about outsourcing.

Keep an eye on:

  • It’s third-hand information now, but Silicon Alley Insider’s Henry Blodget cites Thedeal.com’s report that the Yahoo-Google search deal is “toast.” (Silicon Alley Insider)
  • Radio: It’s gaining audience (wow!) — but not revenue (woe!). (AdAge)
  • Speaking of radio, Sirius says it retired $30.5 million of its $300 million in convertible notes coming due in February. More exchanges are possible, considering how roughly the debt appears to be affecting the company’s stock. (The Wall Street Journal)
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