Free Press to Outsource Ad Design to India

Last week, Sue Clark-Johnson, soon-to-be-retired president of the Newspaper Division of Gannett Co., Inc. [1], told a gathering of industry executives something they already knew: “It’s a hellish time for newspapering.”

No one seems to know that more than Gannett, which owns 85 U.S. newspapers, including The Burlington Free Press [2]and USA Today [3]. A few days before Clark-Johnson spoke at the Newspaper Association of America [4]’s annual conference, Gannett’s share price hit a new 52-week low. That came on the heels of a disastrous 2007 that saw the company’s stock lose 35 percent of its value.

To cut costs, Gannett hired a Los Angeles company, 2AdPro [5], last January to help its newspapers outsource their advertising production design to India. That decision has apparently made its way to the Free Press. The paper, according to people familiar with the situation, has begun shipping the design part of its ad-production process to India via 2AdPro.

How many jobs will be lost and what the Free Press hopes to save through outsourcing is unknown: Jeff Barr, the paper’s advertising director, did not return a call for comment. Through an administrative assistant, Barr referred questions to Free Press publisher Brad Robertson, who also did not respond to several telephone and email messages.

It’s hardly a secret that Gannett is looking to consolidate as much of its newspaper business as it can. The Free Press is among a group of Gannett papers that have already moved their circulation call centers to Kentucky. In a somewhat more drastic maneuver, the company sold four papers last year because they didn’t fit into its strategic plan. According to Gannett’s most recent annual report [6], the location of the four papers “made regionalization and optimization of resources impractical.”

Gannett’s so-called “optimization” strategy also included cutting, through attrition, layoffs and buyouts, about 3000 jobs last year. Meanwhile, Gannett CEO Craig Dubow was awarded a $1.75 million bonus for his work in 2007, in addition to $1.2 million in base salary.