When cell phone and video games company, Global Wireless Entertainment (GWE), needed to create a new motor-racing game, it contracted the services of Paradox Studios in Mumbai, India.
The San Diego-based video-games publisher owns the rights to a game based on the exploits of legendary race driver Mario Andretti. Using Paradox, GWE could save 40%–50% from its production budget. “People think of India as a place with good programmers, but they don’t realize that we have a very large pool of creative people as well,” says Salil Bhargava, CEO, Paradox Studios. “We have a movie industry that is larger than Hollywood.”
The trend of large corporations outsourcing repetitive production tasks such as data processing, accounting or even computer programming to offshore facilities is now seeing a change to them outsourcing the creative aspects of their business such as content creation, video editing and video-games production. Some of the world’s largest media companies have begun the process, and are outsourcing content creation and journalism to India and the Philippines.
Creative content is now the new frontier in the outsourcing business. CNet’s Builder.com, a Website for software developers is outsourcing about 40% of its content, while Reuters has hired over 300 journalists to cover 3,000 small and medium sized U.S. companies from its offices in Bangalore, India. These efforts, largely unreported by mainstream media, are blazing new territory in these service-delivery areas; yet paradoxically enjoy the benefits of trailing edge adoption curve when it comes to governance. In short, no one is having to re-invent the wheel when it comes to managing these processes.
Seeking Contentment
There’s a bevy of so-called big media companies such as Reed Elsevier, McGraw-Hill and LexisNexis that have been looking abroad for more and more of their content-creation needs. Now cellular companies, television production companies and even video-games developers are outsourcing everything from mobile content for the cell phone, to video editing to companies in India. Most are characteristically shy about talking about outsourcing their content, lest customers and investors regard them poorly.
Even so, the advantages outweigh the disadvantages, and the cost savings can be great. “Companies can save between 40%–60% from their production cost, streamline their production process and mitigate the risk of relying too heavily on one region for all their content needs,” says Mike Maziarka, Director, InfoTrends, a consultancy in Weymouth, Mass.
For example, GWE contacted Paradox last year, and the Indian wireless company gave its employees the task of researching on the life of Mario Andretti. Two weeks later, there was a proposal in San Diego.
Once that was approved, a game-design document was drawn up by Paradox. “In the alpha stage, we do the basic programming and develop the graphics,” says Paradox’s Bhargava. “Then by the beta stage, we have a playable demo.”
The whole process takes between three to six months. Now Mario Andretti is available on the Verizon platform.
Bhargava stresses on companies securing their intellectual property by working with reputed companies when outsourcing creative content. “Our computer labs have no USB ports, zip drives, CD burners or access to the Internet,” he says.
The editorial services outsourcing (which includes editing) market is also growing, and is pegged at about $500 million in 2006. This is expected to grow to over two billion dollars within five years, according to InfoTrend’s Maziarka. Of that sum, about $300 million is in the scientific, technical, medical and text book market place, a sector well suited to regions such as India and the Philippines.
