A change in earnings news release distribution

Andrew Ross Sorkin of the New York Times writes Tuesday about how Microsoft and Google are now disseminating their earnings releases on their Web sites instead of issuing them via a press release distribution service.

Sorkin writes, “Unfortunately, in practice, the system doesn’t work nearly as well. (I have to admit, I was an early believer in the switch to allow companies to disseminate news on their Web sites.)

“But think it through: If every company were to release all of its market-moving news only on its Web site, investors would have to traipse around the Internet in search of the market-moving information. It’s one thing for a news organization to have a scoop; it’s quite another for a company to actively keep the news on its own site.

“Mr. Koefoed of Microsoft doesn’t believe that new process creates problems. ‘I got relatively little noise,’ from Wall Street about the release, he said.

“Microsoft, he said, chose to distribute its news online so that the company could provide more disclosure — including items like earnings slides and important performance indicators not included in a typical release. He also noted that most of Microsoft’s most important investors ‘subscribe to the RSS feed.'”

Read more here.