Newspapers see sharp circulation drop of 4.6 percent

[October 28, 2008]  NEW YORK (AP) -- Circulation at the nation's daily newspapers is falling faster than anticipated this year as readers continue their migration to the Internet and papers narrow their distribution to cut costs.

The development, which compounds the fiscal challenge of plummeting advertising revenue, was revealed Monday when the Audit Bureau of Circulations released sales totals reported by newspapers for April through September.

Combined weekday circulation of all 507 papers that reported circulation totals this year and last averaged 38,165,848 in the six months ending in September, 4.6 percent below 40,022,356 a year earlier. The aggregate drop was only 2.6 percent in the September 2007 period, compared with September 2006.

Sunday circulation fell faster than daily -- 4.8 percent, to 43,631,646 at the 571 papers with comparable totals. A year ago, Sunday circulation fell 3.5 percent.

Daily circulation at 16 of the 25 largest papers fell more than 5 percent in the latest period.

Circulation has been dropping at newspapers for decades, a trend sped up by readers shifting to the Internet. Newspapers also have lost advertising in recent years because of the Internet, and that decline accelerated this summer as the weak economy prompted advertisers to pull back on spending.

To boost revenue, many papers also have increased prices, a move that has caused small circulation drops.

This year's sharpening circulation drop also appears to result in part from the way papers are responding to losing ad revenue, said Rick Edmonds, media analyst at the journalism think tank Poynter Institute.

"Times are tough, and they are looking at everything that's in their expense base," he said. "Building new subscribers is an expensive proposition."

Consider The Atlanta Journal-Constitution, where circulation declined 13.6 percent, the largest drop among the 25 largest papers.

The paper increased prices and reduced its distribution footprint by a third to 49 counties. Some of the counties dropped weren't even in Georgia and were more expensive to reach, said Bob Eickhoff, the paper's senior vice president for operations.

The Journal-Constitution also distributed fewer free and cut-rate promotional copies that readers might simply toss, figuring advertisers are more likely to want readers who consciously buy the paper, he said.

Randy Bennett, senior vice president for business development at the Newspaper Association of America, said focusing on core readers is a move by papers to improve value for advertisers.

But Ken Doctor, media analyst with Outsell Inc., said papers have been shrinking their territories for years without seeing such sharp circulation drops.

He blames the acceleration on reduced quality as papers drastically cut staff and other expenses.

"The fact that there are less pages, fewer stories, less familiar bylines, readers are noticing, and that's having an impact," Doctor said. "What is worrisome is the product is getting cut back even more."

With the economy in a major downturn, he said, newspaper readers are more likely than ever to drop their subscriptions because there is a free alternative -- the Internet.

In a sign of hope, usage of newspaper Web sites grew nearly 16 percent in the third quarter, compared with last year, to an average of more than 68 million monthly unique visitors, the newspaper group said last week.

"Circulation does not tell the complete story," Bennett said.

But online ad sales haven't increased fast enough to offset the declines in print, which still makes up the bulk of a paper's revenue.

Among the nation's largest newspapers, USA Today remains the top seller with average daily circulation of 2,293,310, just 173 more than last year. The No. 2 daily, The Wall Street Journal, also reported flat circulation -- up just 117 copies to 2,011,999.

The New York Times' circulation fell 3.6 percent to 1,000,665, while circulation at the Los Angeles Times fell 5.2 percent to 739,147. All other papers in the top 25 also saw declines.

The New York Times remains the top paper on Sundays, when USA Today and the Journal do not publish, with a circulation of 1,438,585, down 4.1 percent. The Los Angeles Times follows at 1,055,076, down 5.1 percent, and the Post at 866,057, a decrease of 3.2 percent.

Among the top 25, only the St. Louis Post-Dispatch and the St. Petersburg (Fla.) Times reported Sunday gains, of 0.8 percent and 0.1 percent, respectively.

Despite the industrywide decline in circulation, five papers outside the top 25 reported gains of at least 5 percent, led by the Wisconsin State Journal of Madison, where circulation rose 10.6 percent to 97,012.

The other gainers are The Macomb Daily of Mount Clemens, Mich., The Daily Sun of The Villages, Fla., The Times of Trenton, N.J., and the Citizen Tribune of Morristown, Tenn.

[Associated Press; By ANICK JESDANUN]

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