Macmillan pioneered it way back in 1977 and now companies like Thomson Press (NYSE: TOC), NewGen Imaging Systems (NASDAQ:ITEC), Springer, Elsevier, Techbooks, Reeds and others are taking forward the trend that is gaining huge traction.

India is providing companies all over the world with a low-cost alternative to managing their publishing operations – from pre-press, typesetting, editing to proofreading. Several large global publishing and content companies and educational institutes have been saving anywhere between 30 and 50 percent of their costs by offshoring their processes to India. ValueNotes estimates peg the market for offshored publishing services in India to reach around $350 - $370 million by 2007.

Scientific, Technical and Medical (STM) publishing is the largest segment in publishing outsourcing, and ValueNotes research shows that about 80% of the market for the Indian vendor lies in STM publishing. The more recent services have been in areas like schoolbooks and textbooks, data digitalization and variable or on-demand printing. Related areas like assessment and testing for K-12 education are also being explored.

India now boasts captive units and subsidiaries of several large publishing houses, alongside its growing list of homebred publishing service providers. Macmillan has over 1500 employees in India; Springer has 1500+, while Newgen has more than 600, just to name a few. Apart from the multinationals, are large and mid-sized third party vendors offering services directly to global STM publishers, and at least 100 odd small vendors, providing a pool of sub-contractors for the larger vendors. Eager to survive, these smaller vendors are ready to work at cheaper rates, offer fairly quick turnarounds and variable capacity. All of this benefits the larger players, who manage to keep costs down.

A win-win situation
Publishers are not just looking at India as a back-office for lowering operating costs. They are also banking on the large, growing readership base in India as a market for their content. The huge English speaking (and reading) population in India allows it to score ahead of other populated countries like China. India is already the third largest publisher of English language books in the world after the US and UK.

Apart from low labor costs and the domestic market, India has also become a printing hub for many of these publishers. The low cost of paper, printing and other material is making it economical to print in India, and even export to other countries around the region.

Recently, publisher Simon and Schuster declared that they are considering introducing some of the English editions from their UK and US operations to India. In future, they are also considering localizing some of the content to suit the Indian market. Infomedia, a leading Indian media and publishing house has entered into a joint venture with Reed Business International, a division of Reed and Elsevier, to launch Indian editions of Reed’s global titles. Sage Publications, another global publisher is also making use of India both as an outsourcing destination and a target market for sales.

Sage expects that India will be a substantial contributor to the company’s fortunes in future. India can expect several other publishers to enter and exploit the opportunity to serve the needs of a burgeoning middle class with rising purchasing power. Besides, the retail boom in the last few years has opened up channels for nation-wide distribution through bookstore chains that are mushrooming all over the country. All in all, there seems to be a promising opportunity for everyone!