Full circle

Reuters’ decision to create a global editorial hub in a provincial English city appears to be driven by an imperative to cut costs in a contracting market for world news.

The rationale that “the UK is an ideal location for a global desk for a number of reasons, including readily available talent, time zones and language” could have been argued at any time since the agency’s founding in 1851. Indeed it was, which is one reason why the centre of operations remained in ever-larger offices in London until the takeover by the Thomson organisation in 2008 when the centre of gravity shifted to New York.

The British capital has become expensive, both for employers and employees, however. The cost of office space, of housing and of commuting between the two has become crippling for many.

The same may be said for Reuters’ other editorial hubs in New York and Singapore. There has been no disclosure of plans to move out of those cities, though an internal announcement did say that the transfer was “part of a drive to forge a more global approach to desking and give staff the chance to work outside expensive locations such as London, Singapore and New York”.

In the 1970s, Reuters expanded its main editing operations beyond the London headquarters to regional hubs - in Africa, the Americas, Asia and the Middle East - in which responsibility for controlling the world file was handed on from one to another through the 24-hour news cycle.

One reason was to make editors more knowledgeable by placing them closer to the news they were responsible for processing. Another was to make rapid reinforcement of regional bureaus easier. Over the years, the Africa and Middle East desks closed, but Reuters believes that, besides the new global hub, it will always need editing desks in the Americas and Asia. Partly, it’s argued, this is because those desks fulfill functions other than editing, like bureau reinforcement, that can best be done locally. Also, overnight staffing of the new global desk is not envisaged.

To some, creation of a global hub may be seen as a return to the way things were done previously, but with the advantage of vastly better and more cost-effective communications.

The new hub will “forge a more global” approach to how Reuters carries out editorial production, the internal announcement said. Last year, the sports desk was integrated into the main Europe, Middle East and Africa editing desk - formerly World desk - in London.

The new desk will be up and running by year-end and will take a number of years to build up and “grow into an exciting new hub”.

Locating it in Nottingham, 110 miles north of the capital at the heart of a region known as the East Midlands, will give staff “a more affordable alternative to the difficulties of living in London (and other editing centres)”, employees were told. Housing in Nottingham is about one-third the cost in London.

Reuters’ parent Thomson Reuters has already decided to cut its UK cost base by transferring from an iconic building adjacent to Reuters Plaza at Canary Wharf in London’s Docklands to less expensive premises nearby. The group plans to consolidate most of its London workforce at the new location by 2019.

The new editorial production centre will be housed at Chapel Quarter, a low-rise, glass-fronted leisure and office complex built in 2008 on a street called Maid Marian Way after the love interest of Robin Hood, the legendary 14th century outlaw who famously “robbed from the rich and gave to the poor”.

The 145,000 square-foot building is owned by British Airways pension fund, which bought it last year for £25.5 million. Thomson Reuters is already a tenant, among others: some 147 technical staff work there together with a small number of employees of the group’s financial and risk powerhouse.

Relocation to the new office will be “a purely voluntary exercise” and there will be no change in terms and conditions for existing UK-based staff opting to move. Those who volunteer to go will be able to claim up to £5,000 in relocation expenses.

The move out of London coincides with persistent talk of cuts in Reuters’ editorial budget. Unconfirmed reports say several bureau chiefs have been told they cannot fill any vacancies for the rest of the year.

Many news organisations are struggling to balance an unsustainable cost base in which rising production charges and a decline in print revenue have not been replaced with a concomitant increase in digital income.

In the first quarter of this year, the news division’s revenues were almost flat at $75 million, up $1 million from the prior-year period. Reuters provides only about three per cent of Thomson Reuters’ total revenues and generated a loss of $2 million in the quarter. ■