‘El Diario’ Not Surprised by ‘Hoy’ Scandal

By: Mark Fitzgerald and Jennifer Saba

Since its beginnings in 1998, the Spanish-language Hoy had a rocket-like trajectory that seemed almost too good to be true. According to an extensive report today in a sister Tribune paper, it was. Hoy’s success was fueled by false circulation statements since the first week of publication, Newsday of Melville, N.Y., reported.

Meanwhile, its New York City Spanish-language rival, El Diario La Prensa, is weighing in with a survey of newsstand dealers that suggests its tabloid is outselling Hoy by 2-to-1 on the streets of the Big Apple.

Current and former Hoy employees told Newsday reporters, according to today’s report, that the mandate from management was to beat arch rival El Diario La Prensa at any cost. A former top manager at Hoy told Newsday, “Getting to a certain number was the only way to get advertising so we could go against El Diario,” she said. “El Diario was doing about 53,000 a day, and Garcia and Sito wanted to pass that number as quickly as possible. They were very upfront about it.”

The Garcia and Sito she refers to are Robert Garcia, Hoy’s circulation manager, and Louis Sito, the former publisher who abruptly announced his retirement on Monday. Both Garcia and Sito are named in the lawsuit that was filed in February by advertisers accusing Newsday and Hoy of falsifying circulation numbers.

The Newsday team also uncovered two invoices from Manhattan dealers during 2001 that illustrate how Hoy’s circulation was manipulated. The dealers were charged $.10 per paper and the invoices showed no returns. However there was a “miscellaneous” credit that practically matched the costs of the total papers, said the paper.

Tribune executives were not available for comment except for spokesperson Gary Weitman, who told reporters that the company cannot comment beyond the statements made during last week’s second-quarter earnings announcement due to pending litigation. Tribune Publisher Jack Fuller said in a statement that he had “confidence in the future of Hoy.”

El Diario, of course, is saying that this is all no big surprise, to them. “Even before the [Hoy circulation] scandal became official, so to speak, we had been hearing anecdotal evidence from newsstand dealers. But there’s a big difference between anecdotal evidence and knowing for sure. We wanted to do a reality check,” said Douglas Knight, chairman and CEO of impreMedia, El Diario’s owner since last summer, in a telephone interview.

El Diario asked 1,500 newsstand dealers in the Bronx, Brooklyn, Manhattan and Queens to participate in the survey. It says 969 agreed, and have signed affidavits attesting to the average numbers at their stands. According to the paper, the results show El Diario selling an average of 12,180 papers a day at these stands, against an average of 6,271 for Hoy.

Knight said El Diario’s suspicions were aroused not simply because of the rumors of circulation manipulation, and the accusation of fraud in a lawsuit filed last February by some Newsday and Hoy advertisers, but because of the wide disparity between the reported circulations of the two papers, and the readership results found by the most recent Scarborough report.

“Scarborough was showing El Diario La Prensa with significantly more readership than Hoy — and yet the circulation numbers were showing exactly the opposite. That didn’t make much sense to us,” Knight said. The readership results, Knight said, have consistently shown El Diario at about 256,000 and Hoy at about 180,000.

In the last Audit Bureau of Circulations (ABC) FAS-FAX, in which Hoy showed a now-discredited jump of 20.2% year-over-year circulation, El Diario reported a 4.9% decline to 50,019. Knight said the decline was the result of purposely shedding circulation that “we thought was not profitable. … Now we’ve got what we think is a solid base for circulation, and we’re growing from that,” he said.

Knight wrote ABC last week, providing the survey results and urging continued investigation. The letter states, in part: “We are providing this information to you to emphasize our desire to get to the bottom of this issue, to seek full disclosure as to the extent of the misrepresentation at Hoy. Who knew what? When? How deep does this go? Can we be confident that the ABC audit and the Tribune Company’s internal investigation have actually discovered the full extent of the misrepresentation?”

ABC spokesperson Heidi Chen said the bureau did not comment on its communications with members. “It’s typical for us to get several calls in competitive situations,” she said. “Just out of respect for our members, we don?t publicize the communications we have with them.”

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