The shared services program, HMPS, which was launched last year without any clients, allows publishers to tap into Hearst’s relationship with CDS Global, a publishing operations firm it owns that offers print and digital services to clients.
Carey, who said the group has few clients, declined to disclose their names. Condé Nast officials could not be reached for comment.
The new HMPS venture is an outgrowth of CDS, which is operated separately from Hearst. CDS already manages certain end-to-end outsourcing for 450 print and digital publishers, including such functions as order management, payment and customer service. Current clients include magazines from big publishers like Condé Nast and Rodale to smaller ones like August Home Publishing and Garden & Gun LLC.
Last September, when the formation of HMPS was revealed, Hearst Magazines executive vice president and general manager John Loughlin told WWD that the decision to offer such a service came after a handful of clients inquired about services outside of CDS’s management-based offerings.
“Hearst will go further up the value chain,” said Loughlin, who runs the new group. “We can help build circulation models for third-party publishers. Potential clients could have access to our digital asset management system.”
Other services may include consumer marketing, consultation around content creation and advertising sales, procurement, production, Web site, app and e-edition development, financial management or subscription and fulfillment management.
At the time, Loughlin was asked if Hearst would have access to information about its competitors as a result of the formation of this new group, to which he said: “When we work with third party clients, we are extremely careful about guarding their proprietary information. The company built a Chinese wall between our business and our clients’ businesses.”
He noted that the HMPS team will include only the highest–level executives, including Hearst Magazines’ head of consumer marketing and the head of production.
“The world is going through a period of real consolidation,” Loughlin offered. “We are committed to the magazine business. We are committed to growth and we are going to be here a long time.”