By paulgillin | November 23, 2009 - 10:34 am - Posted in Advertising, Business News, BusinessModel, Circulation, Demographics, Murdoch, NewMedia, Newspapers

The dismal circulation figures reported by the US newspaper industry a couple of weeks ago may actually have been optimistic. There’s new evidence that many publishers took advantage of recent changes to Audit Bureau of Circulations (ABC) rules to actually overstate their real readership numbers. The blogosphere is having a field day with this one.

The catalyst was this AP piece that points out that changes adopted by the ABC seven months ago now enable publishers to count “bundled” subscriptions of paid and online editions as two subscribers, even if only one person is doing the reading. This continues recent trends by the bureau to loosen rules and give its publisher customers more flexibility to pump up their numbers. In the spring of 2008, for example, the ABC made it possible for publishers to declare as paid circulation copies that sell for as little as a penny.

The AP story doesn’t pinpoint how many news organizations benefited from the rules change in the most recent reporting period, but notes that 59 newspapers counted at least 5,000 electronic editions in their weekday circulations. If those numbers were backed out, the record 10.6% drop in the most recent six-month period would probably have been even worse. The story cites several examples of papers that showed declines in print subscribers but were still able to post circulation increases by counting delivery of electronic editions.

However, numbers games don’t fool anybody in the world in which smart people with spreadsheets can quickly analyze them. As Mark Potts points out, “Fudging the numbers may make internal constituencies happy, but they’ll bite you in the long run. Advertisers can count, too.” In other words, you can slice the numbers any way you want, but it doesn’t count for a hill of beans if customers don’t come in the door.

Electronic editions are basically digital versions of the print product that readers can download for the sake of convenience, ecology or availability. Jim Brady tweets wryly, “Nothing shows that you ‘get’ digital more than trying to deliver it to people in exactly the same form it appears in print.”

The circulation gains are part of a broader campaign by publishers to distract people from the reality of plunging circulation and ad revenue. Scarborough Research released a much-cited report recently that documented that 74% of American adults read a paper in print or online during the past week. These statistics look impressive, but qualifiers like “adult” and “in print or online” color the numbers. The newspaper industry has largely lost the youth market and online distribution is a mixed blessing at best.

Publishers are playing numbers games of their own. Mark Hamilton notes that the industry has largely abandoned circulation figures in favor of research-driven readership numbers that report the number of people who have read or looked into a newspaper in the past seven days. These figures serve to buttress the argument that newspapers are still a core element of American life while obfuscating the fact that subscribership is down.

And even large circulation numbers don’t equal business success. Alan Mutter contrasts the circulation strategies of two Bay Area publishers: Hearst’s San Francisco Chronicle and MediaNews Group. The Chron has all but abandoned discount circulation in a quest to cut its operating losses and drive circ revenue to 45% of total sales next year. MediaNews is taking the opposite course. It has used aggressive discounting to become the most widely circulated publisher in the area. The combined circulation of MediaNews papers in the region is now nearly triple the Chron’s. MediaNews president Jody Lodovic calls his strategy a long-term view, but is junk circulation good for anybody? The Chronicle‘s strategy is to stabilize its business, which may be a more rational plan in an unpredictable economy.

Whatever the numbers, advertisers are speaking more loudly with their dollars. US newspaper advertising revenue fell by nearly 28 percent in the third quarter from $8.9 billion to $6.4 billion. If you extrapolate that out to a full year, the US newspaper industry has shrunk by nearly half since 2006, when it reported $49.2 billion in revenue. The AP quotes Newspaper Association of America (NAA) president John Sturm positioning the figures in the context of a dismal economy, but it’s hard to find any bright spots when even online advertising was off 17%.

Miscellany

All may not be lost for the East Valley Tribune, which earlier this month announced plans to shut down at the end of the year. The paper reported on Friday that an unnamed buyer has emerged who plans to keep the paper operating both in print and online. The buyer also plans to keep a “substantial” number of Tribune employees on the payroll. There were no other details. Freedom Communications, which owns the Tribune, has been seeking a buyer since early this year, but no serious offers emerge prior to a Sept. 1 bankruptcy filing. In fact, Freedom’s chief financial officer said one bidder offered to take over the business only if Freedom paid him to do so


Count Twitter cofounder Biz Stone among the army of skeptics about Rupert Murdoch’s plans to remove News Corp. properties from Google’s search index. Saying Murdoch’s scheme is likely to “fail fast,” Stone told a London audience that the Australian media magnate should instead focus on “how to make a ton of money out of being radically open rather than some money by being ridiculously closed”. He suggested that Twitter’s crowdsourced model offer some opportunities and that the company would be willing to work with newspaper publishers. Twitter executives also said last week that the service will soon announce a plan to start making money off of the estimated 60 million members it has acquired.

And Finally…

Ed Padgett pointed us to this clever music video by Christopher Ave, the political editor at the St. Louis Post-Dispatch who isn’t a copy editor but who is sympathetic to the plight of wordsmiths around the country who are falling victim to layoffs. The slick production, which looks like it was recorded in a newsroom, includes the following refrain:

I was there to fix your grammar
When you thought it wouldn’t matter
Cut all your extraneous blather down

AP Stylebook is my bible
Helped me stop a suit for libel
But nothing ensures my survival now

And I don’t know what I’ll do
After I am through
Killing my last adjective

Mallary Jean Tenore tells the story behind the video on Poynter Online. It has less than 800 views, so go visit it and add to its five-star rating.

Comments

comments

This entry was posted on Monday, November 23rd, 2009 at 10:34 am and is filed under Advertising, Business News, BusinessModel, Circulation, Demographics, Murdoch, NewMedia, Newspapers. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.

2 Comments

  1. November 24, 2009 @ 11:57 am



    Lying to yourself is never a good way to face your own demise when you should instead hunt around for a way to save your own ass.

    That’s why I predict a startlingly rapid demise for the entire industry. Its going to come down like a house of cards in a hurricane on a heavy planet.

    If only the publishers had not started off with a price of zero just because the actual costs were just a rounding error compared with the print media. Now they have to live off off of that rounding error and it can’t be done.

    They should have started monetizing the internet immediately because its too late now.

    They publishers are starting to see that its awfully tough to climb back up from zero, up what is a very slippery slope.

    Entire sections of the news will gave to go dark, both in terms of geographic coverage and topic coverage, before we can attempt a reset and restart based on the actual value to the reader of the news gathered , vetted and aggregated, not based based on the costs of the electrons used to deliver the news.

    Its going to take Google news going dark in major areas and having to use Twitter feeds to aggregate un-analyzed event before we notice how far we’ve all sunk (and some people, reading froth and buzz, may never even realize it.)

    Cute song by the way. If only the songwriter had had some friends with better tone and pitch who could hold a tune. He can write, but he should collaborate on the delivery with a singer. I’m sure there are lots of singers who would love to help him put words in their mouths.

    Posted by msbpodcast
  2. November 27, 2009 @ 12:16 am



    I ran across the song writer’s Guru.com contract.

    He is reaching out for someone to do exactly what I said. Too bad I can’t help him with the vocals…

    Posted by msbpodcast