Bangalore among 18 cities to be Reuters' hub

Monday, 27 October 2003, 20:30 IST
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LONDON: Bangalore is one of the 18 cities around the world where Reuters, the electronic information group, is transferring its global software-development in the latest phase of its £440mn ($738mn) cost-saving programme. The move, likely to involve several hundred job losses, will see the group's European development operations move to Paris -- leading to the closure of sites in London, Nottingham, Hamburg and Geneva. Tom Glocer, chief executive, told the Financial Times the group's development locations "were a crazy way to do business -- it lowers capital utilisation and it's really expensive". Glocer confirmed the company would increase job relocation to low-cost markets in Thailand and India. The company is doubling staffing levels at its Bangkok centre, one of the four new hubs, to 600 by the end of next year. It is also expanding a centre in Bangalore to include software development. Jobs are already being transferred to the Indian city as part of a separate move to reduce costs in Content Creation Services, which collects financial data for Reuters screens. Development operations will close in Hong Kong, Singapore and Tokyo as part of the Asian shift. The company is also consolidating centres in nine U.S. cities including New York, Denver and Kansas City around a hub in St Louis. Glocer said the changes would lead to significant savings in employee costs. Salaries for software programmers in Bangkok are more than 80 percent lower than in the U.S. Reuters earlier said that 600 employees in its content division would be moved to Bangalore by the end of 2005. There, employees cost £7,000 a year, as opposed to £30,000 a year in the U.S. The job outsourcing is part of the company's "fast forward" programme, an attempt to turn around the fortunes of the 152-year-old firm. Last year Reuters made a loss of £493m and sales fell eight percent because of competition from Bloomberg and many job cuts in the financial sector.
Source: IANS
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