Newsday plans to outsource its circulation customer-service operation to the Philippines later this year, eliminating about 50 jobs.
In an e-mail message to employees, publisher Timothy P. Knight and circulation vice president Paul Barbetta said the newspaper has hired APAC Customer Services Inc. to field inquiries from subscribers and others about delivery issues. They predicted that readers would see an improvement in service as a result.
The move is part of a larger effort by Newsday's parent, Tribune Co., to reduce costs in the face of an uncertain advertising market and pressure from key shareholders to boost its stock price. Nine other Tribune papers, including the Chicago Tribune, The Baltimore Sun and the Orlando Sentinel, also are outsourcing their customer service to APAC in the Philippines. The largest paper, the Los Angeles Times, has used APAC since 1998.
Tribune Co. didn't require its papers to outsource, but spokesman Jeff Reiter said "they all chose to get on the program because they were looking at better customer service for readers and the cost savings."
Tribune expects to save $40 million per year by eliminating 250 customer service jobs and combining computer systems. At Newsday, officials estimated the savings from the outsourcing at more than half the cost of the current in-house operation.
Illinois-based APAC fields customer calls for more than 30 newspapers, according to sales vice president Mark Carver. It opened a second facility in the Philippines earlier this summer and has plans for a third by year's end.
Still, veteran newspaper analyst John Morton expressed concerns about the potential for offshore operators to alienate subscribers, whom papers are struggling to retain in the face of competition from the Internet.
"One of the complaints of outsourcing customer service has been that you often get somebody who is challenged by the English language," he said. "Circulation is one of the most sensitive areas of the newspaper business, and the last thing you want to do is irritate your customer."
