The State of Sourcing

There has been quite a brouhaha over the impact of tablets and e-book readers in our lives over the past couple of years. With the iPad series being the clear front-runners, the other game-changers are Amazon’s Kindle series and the Nook by Barnes & Noble. All the potential talk over how these will have a massive influence on media, marketing and publishing is explained by the fact that Amazon and Barnes & Noble have each decided to put another 4-5 million tablets each into the market in 2012.

This holiday season, consumers are looking at buying and gifting another transformational format for the media and entertainment industry – the e-book. With the foundation being built slowly over the past two years, the e-book industry is now unleashing its full marketing potential to convince tablet owners to make the “digital switch” from traditional hard covers and paperbacks to its electronic form. Amazon and B&N have already established their proprietary e-book formats and dozens of other publishers are getting on-board to digitize their output.

Continue reading ‘Holiday season cheer for publishing outsourcing with meteoric rise in demand for e-book services’ »

In the recent months, we have been studying the effect of the digital market on the publishing industry. Across segments and geographies, publishers are experiencing challenges centered on costs, resources and technology that have made it necessary for them to re-invent their business models.

Of the 200+ publishing professionals we interviewed, we found that close to 4 in 5 publishers are either outsourcing or considering outsourcing publishing services. So, if the whole industry is pretty much outsourcing technology, back office processes and industry specific publishing services, why is it still taboo? Perhaps some context would help.

Continue reading ‘Why is the outsourcing of publishing services still taboo?’ »

The newspaper and magazine segments are the largest contributors in revenues to the global publishing industry – contributing close to 52% of global publishing revenues. It would therefore be safe to assume that of all the challenges faced by the industry, none would be as altering (in terms of revenues) as the challenges faced by these two segments. The newspaper and magazine segments have already lost considerable revenues on account of dip in ad revenues. This is directly attributable to the global economic slowdown, which has led to decrease in consumer and corporate spending.

Continue reading ‘Magazines: Ad-ing up the losses’ »

With the publishing industry facing cost pressures, change in consumption patterns and struggling to sustain its revenues, it only seemed logical that the industry as a whole would outsource more. To truly understand how the industry value chain perceived outsourcing, we at ValueNotes Sourcing Practice decided to conduct a publishing survey.

To gain clarity on where the industry is heading, we needed to understand: Continue reading ‘Publishing Survey: Disparity in cost savings continues’ »

The newspaper and magazine segments are the largest contributors in revenues to the global publishing industry – contributing close to 52% of global publishing revenues. It would therefore be safe to assume that of all the challenges faced by the industry, none would be as altering (in terms of revenues) as the challenges faced by these two segments. The newspaper and magazine segments have already lost considerable revenues on account of dip in ad revenues. This is directly attributable to the global economic slowdown, which has led to decrease in consumer and corporate spending.

Does a drop in revenues merit a need to re-invent the business model? How are publishers coping with the dip in revenues? Will the digital market provide a strong revenue source? Will this mean more outsourcing/offshoring?  Over two posts, I will answer these questions, starting with the newspaper segment.

Continue reading ‘Newspapers: Stop the presses?’ »

Margin pressures are a sign of maturity (and commoditization) in any services industry. Publishing outsourcing is no different. Low entry barriers have kept the wannabes pouring in, relentlessly setting up shop, offering ridiculously low prices … to a point where it won’t work any further. However, that hasn’t stopped any more wannabes from joining the game.

While this phenomenon on one side of the industry spectrum has led to rapid commoditization of services, it has also galvanized creativity amongst players on the other side. Innovations in productivity enhancements, process refinement and proprietary product development has become the new mantra for industry leaders, in order to stay in a profitable game. Today, prices have dropped to levels that have pushed struggling players out of business, while the larger players are desperately seeking opportunities to grow.

Continue reading ‘The yin-yang of publishing outsourcing’ »

The publishing industry has been undergoing a transition. Starting with increasing costs of production and print, the industry is struggling to address the increasing demand of digital content as opposed to print. In the midst of this transition, the global economic slowdown prompted lesser spending by consumers and corporate spenders.  Over the past few months, we have seen publishers try a variety of approaches – going digital, reducing print publishing, and cutting costs.

In spite of these measures, one thing comes across very strongly – the industry is yet to find that one formula/method that addresses all their problems. The lack of such a formula forced us to ask the question – will publishers outsource? Sure, some publishers already outsource certain aspects of their operations. But will they outsource more? Will they end up offshoring? And if they do want to outsource/offshore, what are the primary reasons for doing so? Are they hoping outsourcing will  be the ‘X’ factor while re-defining their business model?

Continue reading ‘Will publishers outsource?’ »

The outbreak of swine flu has sent countries, cities, people, media, the bureaucracy and governments across the world in a frenzy. In the context of publishing, the swine flu threatens to disrupt sourcing to countries such as India and Philippines.

So what can publishers do to counter potential disruptions in their sourcing?

Starting with in-house resources, the management has to draw contingency plans and preventive measures to ensure that workflows don’t get disrupted at any point. A few contingent plans include enabling employees to work from home, ensuring adequate cover in the form of temporary hires, or shifting workload to other offices.

Continue reading ‘When pigs fly…’ »

Getting up at 3.30 AM is not a good way for me to start my day… especially if I need to dress up in formals. But one flight to Chennai and twelve hours later, I can safely say it was worth it!

We, at ValueNotes Outsourcing Practice, arranged an executive briefing for our report “Offshoring in the Publishing Vertical: 2009” at the GRT Radisson, Chennai on the 26^th of June ’09.  What’s an executive briefing, you ask? Well, we start off with a presentation by one of our analysts on the major findings from the latest report (hence the need for formal attire). This is followed by a panel discussion where industry members discuss, dissect and evaluate certain prominent issues relating to the industry.  The topic we presented before the panel ( Prema from TexTech, Neeraj from PreMedia Global and Nanda from S4Carlisle) was themed around the future outlook of the publishing industry, specifically in terms of challenges and issues.

Vendor consolidation seems to be something that is playing on every publisher’s (and consequently every service provider’s) mind. Publishers are consolidating their respective offshore/onshore service provider base – Continue reading ‘Of executives, formals and publishing…’ »

Recently I had discussions with managers at some leading publishing companies to assess why there is hesitance to offshore some creative services – especially book cover design, illustrations, image design etc. in a big way. I find that most responses are ‘colored’ … with their perceptions about outsourcing and that too ‘outsourcing high-end’ work … Until … I spoke to a small UK-based publisher who was sold out on the concept of outsourcing and has over the last two years managed to offshore his entire production, design and even sub-editing! And is happy being an almost ‘one-man show’ at his UK office.

A book cover design may cost anywhere from $100/hr upwards in the US, vis-à-vis half the cost of doing it in India. Sounds attractive? Definitely… Costs have always made sense for even non-believers of offshoring. However, that alone does not build the case for offshoring…!

Continue reading ‘Offshoring Creative Services – The Fitment Factor’ »