Moving To Free: Success Or Disaster? p. 10

By: Tony Case THREE MONTHS AFTER New York City's Village Voice mimicked virtually every other alternative weekly by going free, the jury's still out as to whether the strategy has been a success.
Like anything else, it depends on who you talk to.
Voice people insist they're happy with their distribution arrangement thus far. In fact, since the switch last April, the paper has boosted its Manhattan circulation twice and now claims to blanket the borough with 185,000 copies each week. The paper still costs $1.25 outside Manhattan.
The Voice says its total distribution has grown from about 150,000 copies before the move to 235,000 today, making it the country's largest weekly newspaper. (The Audit Bureau of Circulations, which tracks the Voice's reach, won't issue its latest findings until October.)
Despite these advances, the grandpappy of the alternative press has experienced a number of distribution problems since the conversion.
Among them:
u Readers have complained they can't find the paper, as it's now available only at selected retail outlets and is carried on hardly any newsstands.
u The tabloid's bright red news boxes stand empty shortly after stocking, and a great many have been vandalized.
u The homeless are said to haul stacks of the Voice out to Brooklyn each week, where they sell it at a cut rate.
u And vendors in the city's train and bus depots continue to charge commuters for the "free" paper.
Despite all this, publisher David Schneiderman maintained that both reader and advertiser response to the free scheme has been "phenomenal." He accused the Voice's competitors of "blowing smoke" about its initial difficulties.
"The only circulation problem we had was that people were grabbing the paper so quickly," he said. "There were some complaints in the beginning, but not anymore."
Schneiderman said the Voice had begun restocking its racks more frequently, but contended it would be impossible to keep them full.
The publisher called reports that vagrants were peddling the Voice "bullshit," adding that circulation levels outside Manhattan were stable.
"Four tractor-trailers bring our papers into Manhattan," he said. The homeless story "is just disinformation from our competitors. It never happened." However, eyewitnesses have confirmed seeing entrepreneurial street people hawking the paper in the outer boroughs and on subway trains.
As for commuters getting the shaft, Schneiderman explained that New Jersey-based Hudson News, which owns distribution points in Grand Central Station, Penn Station and the Port Authority Bus Terminal, controls pricing and there's nothing he could do about that.
"If people coming in and out of the city want to pay for the paper," he said, "let them pay for the paper."
Of course, commuters have the choice of picking up the Voice at any of the 2,000 markets, delis, record stores and clubs where it's given away.
New York's other weeklies responded to the Voice's new distribution method in various ways.
The New York Observer, a 50,000-circulation broadsheet focusing on society, politics and metro news, promptly took over the Voice's newsstand slots.
Observer associate publisher Elaine Alimonti said that with the disappearance of the Voice, vendors felt "strongly that there's a large opening for the Observer to increase its reach." The paid weekly reported having doubled its newsstand distribution with the move.
The newspaper also added spot color, beefed up its business coverage and launched a promotional campaign on local radio.
TimeOut New York, a paid entertainment guide, has tweaked the venerable Voice in billboard advertising across town. The magazine, which claims a circulation of 50,000, boasted that its listings were "enough to make you lose your Voice."
But no rival has been more combative than the New York Press, the Voice's main free competitor.
The Press, at times, has seemed downright obsessed with its more-established counterpart ? continually criticizing the Voice in columns, publishing letters to the editor that praise the Press and slam the Voice, mounting an ultimately unsuccessful campaign to keep the Voice out of the Association of Alternative Newsweeklies, to which the Press has belonged for years.
But that preoccupation has also resulted in some smart business moves.
Since the Voice went free, the Press says it boosted its circulation to the mighty 100,000 mark; moved its distribution day from Wednesday, when the Voice is published, to Tuesday; devoted space to new editorial features; and brought on additional staff writers, including a Washington correspondent.
On the advertising side, display revenues so far this year are up a staggering 80% over 1995, and classified business has improved 30%, Press publisher Ron Mann said.
Even at this early date, Mann is calling the Voice's switch to free a disaster.
"I know for a fact that they haven't picked up one iota of additional business," he alleged. "They have no significant new ads, and the same consistent group of advertisers."
Mann thinks the Voice has priced itself out of the market. "They could put out a million papers a week, and Joe Retailer can't afford to advertise," he explained.
The publisher revealed that a quarter-page, four-time rate in the Press goes for $600, while the Voice charges $1,800 for the same schedule.
And the Voice, he said, has tried to lure potential advertisers with promises of discounts.
Robert Farrell, owner of Desktop America, a computer-training center that a few years ago moved its advertising from the Voice to the Press and today is the paper's largest advertiser, confirmed that a Voice salesperson had offered him a reduced ad rate. But Farrell said he didn't bite.
"Their prices are ridiculous," he charged. "They were willing to cut me a deal, but their prices are out of range for the results they can offer."
Farrell estimated that 60% of his business is generated by his weekly, full-page Press ads.
The way this retailer sees it, the Voice's move to free was wrongheaded.
"I've been advertising a long time, and when a business goes free, that shows weakness," he said. "Free means you're not an invited guest in someone's home." Voice spokeswoman Alissa Neil countered that the paper "might not be an invited guest, but it's a friend who happened to stop by, and who you're very happy to see."
Meanwhile, one of the Voice's major advertisers, electronics and record store chain J&R Music World, appears overjoyed with the free scheme.
"Initially, we had our reservations, but it's turned out to be a blessing," spokesman Abe Brown related. "Circulation has gone up, the quality of the paper has improved, and our stores are destination points for people to pick up the paper."
Noting his company's 20-year relationship with the weekly, Brown said, "We're happy with the paper. It's proven to be good for us in the past, and as the paper is apparently taking an approach to be more mainstream, it's a plus for us. We're reaching people who didn't read the Voice before, and that's good for us."
J&R is a heavy user of newspaper advertising, doing big business not only with the Voice but with New York's dailies, as well.
As for claims the Voice has offered advertising bargains to attract clients, the paper's vice president of advertising sales and marketing, Kathryn V. Thornton, insisted her paper "maintains rate card integrity."
As Thornton tells it, her sales reps have received calls from businesses seeking deals, "and we said no."
Does she consider the Voice's ad rates out of line?
While stopping short of saying what the weekl The jury's still out as to implications of the charges its advertisers, Thornton said "there's no question we're not a pennysaver."
The paper, she noted, has hired a consultant to determine how its rates fare against other media in New York.
Without naming names, Thornton said some advertisers the Press had garnered were businesses her paper had written off as "bad debt."
The Voice reportedly sacrificed $3 million in circulation revenues when it went free, and Schneiderman predicted it might be two or three years before the newspaper would begin to make that money back in increased advertising income.
But in the short time since the conversion, Thornton reported, the Voice has watched its classified ad inches go up and has enjoyed double-digit gains in audiotex minutes. It's too early to measure any change in display results, she said.
What's more, Thornton maintained her advertisers were pleased with the changeover.
"Our major record, film and retailing advertisers are speaking highly of it," she said. "They couldn't be more delighted that more people are seeing their message. Their cost-per-thousand has gone down in a big way, and that makes them happy."

? (A four of Manhattan streets found virtually all Village Voice boxes emptle, and several had handbille pasted on them. Publisher David Scheniderman said the newspaper had begun restocking its racks more frequently, but contended it would be impossible to keep them full.) [Photo & Caption]

?(David Schneiderman, Village Voice publisher, called reports
that vagrants were peddling the Voice "bullshit." Schneiderman maintains that both reader and advertiser response to the free scheme has been "phenomenal," and accused the newspaper's competitors of "blowing smoke" about its initial distribution difficulties.) [Caption & Photo]