Numbers Game In Detroit p. 12

By: MARK FITZGERALD JUST HOW BADLY has the 10-month strike by six unions hurt circulation at Detroit's two dailies?
The unions say they think they know ? and released a report based on Detroit Newspapers' internal documents claiming combined paid circulation of the jointly produced Detroit Free Press and Detroit News is down 53% to an average 409,000 during the week and down 48% to 564,000 on Sundays.
Nonsense, responds the newspapers' joint operating agency.
""We know our circulation is above 600,000 daily and above 800,000 on Sundays,"" said Susie Ellwood, vice president of marketing development for Detroit Newspapers.
Those numbers are in line with the newspapers' repeated assertions that circulation is down about 25% since the strike.
Before the walkout, the combined circulation of the separate weekday editions of the News and Free Press averaged 886,228. Circulation of the combined Sunday paper was 1,107,645.
Ellwood said the unions' charge that the newspapers are ducking Audit Bureau of Circulations' audits is ""ludicrous."" The papers have not filed publisher circulations statements since the strike started July 1995 ? including the recently released Audit Bureau FAS-FAX report covering the six months ended March 31 ? but Ellwood said an Audit Bureau audit will be released this summer.
""We've had ABC auditors on premises since January,"" Ellwood said. ""We expect to have an audit covering January, February and March by June or early July.""
Further, the only reason the newspapers have not filed formal circulation results is because the Audit Bureau has asked them not to, Ellwood said.
""This is new to them, too,"" she said. ""There really has not been another metro newspaper that published and delivered during a strike.""
According to the unions, however, the Free Press and News may be printing a lot of newspapers ? but they aren't delivering or getting paid for them.
""They're killing a lot of trees, but they're not selling a lot of papers,"" said Al Derey, chairman of the Metropolitan Council of Newspaper Unions, the umbrella organization for the unions representing about 2,000 striking Detroit newspaper employees.
Both newspapers are carrying ""millions of dollars in unpaid and uncollectable bills,"" Derey said.
The circulation system ""is in a shambles,"" he added.
Derey said the unions' research found that paid home delivery circulation has taken the biggest hit. He said combined weekday home delivery circulation is down 61% to 197,000. Paid home delivery of the joint Sunday News and Free Press is off 60% to 282,000, Derey said.
The Metropolitan Council arrived at their circulation estimates by using what it said were two sets of internal Detroit Newspapers documents: sales reports that tallied the number of papers distributed to company warehouses during the week of March 31, and a ""Receivables Analysis"" for the first 14 weeks of 1996.
According to the council, that internal analysis shows that ""DN [Detroit Newspapers] has accumulated more than $4.5 million worth of unpaid and uncollectable bills during the first 14 weeks of 1996 in home delivery zones. In all zones taken together, the unpaid and uncollectable bills total over $6 million.
""Our circulation estimates are derived by projecting the circulation represented by this lost revenue, at $1.55 wholesale cost of a subscription each week for 14 weeks. This unpaid circulation is then subtracted from the number of papers distributed to the warehouses, as reported in the sales reports, to yield an estimate of paid circulation,"" the council's report says.
The union report maintains its estimates of big circu-Striking unions rap News and Free Press for not releasing audited circulation declines is also substantiated by a telephone poll of nearly 1,000 Detroit area residents the papers list as home delivery subscribers plus a door-to-door survey of some 10,000 households.
According to the telephone poll, conducted by Washington, D.C.-based Bannon Research, only 54% of those residents the newspapers say are subscribers. The polling firm said ""at least 32% of the supposed News/Free Press subscribers we reached said they had canceled a newspaper subscription in the last year.""
The door-do-door survey, conducted by union members, found substantial percentages of people getting a paper at their home were not paying for it, the Metropolitan Council said.
"We are providing the numbers that Detroit Newspapers has refused to provide,"" council chairman Derey said. ""Now that we've seen their internal documents, we know why they ducked the Audit Bureau: Their numbers simply won't stand up to an audit.""
Detroit Newspapers' Ellwood, however, scoffed at the unions' report.
"Their figures are pretty absurd, to the point of being ridiculous, "" she said.