Belo at Mid-Year Review Highlights Circ Initiatives

By: E&P Staff Belo Corp. presented today at the Mid-Year Media Review Conference in New York. Coming tomorrow: McClatchy, New York Times Co., Washington Post, Gannett, among others.

In the Belo presentation, Robert W. Decherd, Belo's chairman and chief executive officer, emphasized the significant value of Belo's television assets. The company's release on its newspaper holdings follows.
*

Decherd noted the significant progress being made in transforming Belo's newspaper businesses to compete more effectively in an increasingly Internet-centric environment. "We are creating new print products to reach targeted audiences and leveraging our newspaper franchises to build sustainable Internet businesses," said Decherd. "Concurrently, we are maintaining a strong focus on core newspaper operations, which remain the primary driver of cash flow."

Decherd also reported that Belo's newspapers are implementing a number of proactive initiatives to reshape their circulation to reach the readers that advertisers most desire. Over the last year, The Dallas Morning News narrowed its distribution perimeter to 100 miles outside of Dallas/Fort Worth, which resulted in a cost reduction of $9 million annually with little or no affect on advertising revenues.

At the same time, Belo made a policy decision to cease including third-party barter circulation figures in reported circulation and to limit other third-party circulation. The Morning News also modified its marketing and pricing strategies to reduce the cost and effort involved in attracting and retaining high-churn subscribers and began aggressively targeting subscribers in highly attractive zip codes. To gain deeper knowledge about its readers, The Morning News implemented a Customer Value Management system that accumulates in-depth market intelligence about customers.

Decherd said, "Some of these circulation initiatives are ongoing, so we expect circulation at The Morning News to decline over the next few six-month reporting periods, and that rate of decline could at times exceed other major metro newspapers where different policies are in place. In actively marketing our products, the emphasis should be on attracting quality subscribers rather than seeking quantity at any cost. Instead of focusing on short-term performance, our goal over time is to deliver a stable audience with a demographic profile that is very attractive to advertisers -- and do so in the most cost effective way possible."

Decherd also reported that Belo's online revenues and usage metrics continue to grow at impressive rates. Regarding Belo's recently announced agreement with Yahoo!, Decherd noted, "The partnership among Belo, its fellow Newspaper Consortium members and Yahoo! will allow us to take full advantage of the significant local online advertising opportunity that exists and further propel Belo's Internet businesses."