Thomson buys Reuters

Toronto-based business publisher Thomson Corp has bought UK-based news and financial data service Reuters for US$17.2 billion.

The merged companies will become the world’s largest provider of financial information – a position currently held by Bloomberg.

According to a report at reuters.com:

Reuters Founders Share Company, which has the power to block a change of ownership at the 156-year-old company, backed the deal but it still needs regulatory clearance and shareholder approval, Thomson and Reuters said in a statement on Tuesday.

Thomson said it would do what was required to win antitrust clearance. Reuters Chief Executive Tom Glocer, who will head the combined Thomson-Reuters group, declined to predict how long the process would take but said major disposals may not be needed.

Outsourcing journalism to cut costs

Outsourcing to reduce labour costs has caught on in many industries, and it’s happening in journalism too.

The latest example is pasadenanow.com, where editor and publisher James Macpherson is recruiting a journalist based in India to cover local politics in California. The reporter will be expected to watch council meetings online and conduct interviews by phone or email.

Editor & Publisher reports that some people find the idea appalling and ill-advised:

“Nobody in their right mind would trust the reporting of people who not only don’t know the institutions but aren’t even there to witness the events and nuances,” said Bryce Nelson, a University of Southern California journalism professor and Pasadena resident. “This is a truly sad picture of what American journalism could become.”

It is a shaky business proposition as well, said Uday Karmarkar, a UCLA professor of technology and strategy who outsources copy editing and graphics work to Indian businesses. If the goal is sophisticated reporting, he said, Macpherson could end up spending more time editing than the labor savings are worth.

But Macpherson isn’t the only one cutting costs through outsourcing.

The editors who run US news website reuters.com and British site reuters.co.uk sit at desks in Toronto, where Reuters takes advantage of lower pay rates for Canadian journalists.

And New Zealand Herald publisher APN plans to have most of its newspaper pages, for the Herald and smaller papers around the country, edited by another company. Although the work will still be done in New Zealand (and the contracting company will have to set up a new operation to do it), it is expected to cost less than having the work done in-house. About 70 APN staff will lose their jobs.

>> More on outsourcing journalism jobs to India and to China

Thomson and Reuters confirm takeover talks

Toronto-based business publisher Thomson Corp has confirmed it is in talks to purchase UK-based news and financial data service Reuters. The talks were first rumoured last week.

According to a report at globeandmail.com this morning:

If Tuesday’s proposed deal is successful, Woodbridge — the Thomson family holding company — would own about 53 per cent of the new company, other Thomson shareholders would own 23 per cent and Reuters shareholders would have about 24 per cent.

The combined group would adopt the Reuters trust principles aimed at safeguarding the independence of Reuters news, the companies said. The Reuters Founders Share Co., run by 15 trustees, has a “golden share” and could block a takeover.

The Globe & Mail says the US$17.6 billion deal could be completed this year.

The CEO of Reuters, Tom Glocer, would lead the merged company.