By: Mark Fitzgerald
The Audit Bureau of Circulations is about to release the hotly anticipated circulation figures for the six-month period ending September 2004. The industry is still smarting from circulation scandals as the Securities and Exchange Commission continues its inquiry into circ practices at eight or more newspaper companies (see next page).
Though the SEC claims that none of the contacted companies are targeted for fraudulent practices, the news has only “raised investor anxiety,” Merrill Lynch commented, heightening concern about pressure on ad rates for 2005.
Many chains contacted by E&P after submitting their figures to the ABC declined to reveal what they reported. Catherine Mathis, spokeswoman for The New York Times Co., did pull back the curtain a bit, saying both The New York Times and The Boston Globe expect small gains in circulation. The Dallas Morning News has already estimated daily circulation down 5.1% and Sunday off 11.9% for the period ending September 2004.
Though it doesn’t correlate directly with the reporting period, Knight Ridder announced during its Q3 earnings call that “for the same period and year to date, daily copies were down 0.8% and Sunday copies were down 0.4%.”
For the most part, industry observers think the overall numbers will decline slightly ? “gently,” as Merrill Lynch’s Lauren Rich Fine put it. But Scott Stawski, vice president, client executive at Inforte, a Chicago-based management consulting firm, thinks they could be off as much as 2% to 3% for overall circulation.
Start peeling back the numbers and a different story is likely to emerge. The real decline is expected for more-than-50% paid circulation. Stawski is predicating a staggering 12% to 13% drop. He says to keep an eye out on less-than-25% paid circulation, where a real numbers jump is expected.