From Today's Marketing:
Canwest Global Communications Corp. is outsourcing some of its advertising production work done in Calgary and Regina to a company with operations in India and the Philippines.
Canwest Publishing spokeswoman Phyllise Gelfand said the decision was not made lightly.
“Due to challenges faced by our industry, the global economic downturn and serious impacts to advertising revenue we have been conducting strategic reviews across our company with a goal of reducing our operating expenses–as have all other media companies,” Gelfand wrote in an e-mail.
“We are not the first in our industry to do so. There are currently more than 150 U.S.-based newspapers outsourcing such work.”
Gelfand noted the Ottawa Citizen, a Canwest newspaper, made the same change in March.
The beleaguered media company is grappling with a $4-billion debt load and negotiating with its creditors.
The company’s lenders have given it until Sept. 11 to meet certain milestones and reach an agreement on a recapitalization transaction.
Only a small fraction of that debt has come due, but Canwest’s earnings power has been reduced and its assets have been devalued by the impact of the recession on advertising revenues.