Newspapers
Something good to say about papers
By Lisa Snedeker
May 1, 2008 - 8:06:53 AM

The news would seem more depressing than ever for America's newspapers, with the latest circulation data revealing accelerating declines for the most recent six-month reporting period: 3.6 percent on weekdays and 4.6 percent for Sunday papers.

But there's a bigger story in the Audit Bureau of Circulations numbers, and in some ways a downright encouraging story.

A closer look reveals the most troubling losses are among the nation's large metro papers, those with circulations over 200,000, and that's been going on for several years.

The large national papers, The Wall Street Journal, USA Today and The New York Times, are faring far better, with the first two showing modest gains. The Times was down 3.8 percent over the six months ended March 31, much of that the result of a price increase.

What's encouraging is the number of papers that saw gains in circulation, or at least stayed flat.

Among papers over 200,000 weekday circulation, the San Jose Mercury News was up 1.7 percent between the six months ended March 31, 2007, and March 31 of this year. Also up were the Baltimore Sun, the Orlando Sentinel, the Seattle Times, the Pittsburgh Post Gazette and the Cincinnati Enquirer.

Over the year, total circulation for those top 57 papers was down 3.4 percent, and that figure was dragged down by those few papers reporting truly deep slides, such as the Orange County Register and the Miami Herald, which were down nearly 12 percent.

Among 95 mid-size papers with circulations between 75,000 and 200,000, a dozen had positive numbers over the past year. In total they were down 3.6 percent on weekdays. Gainers included the Las Vegas Review-Journal, the Baton Rouge Advocate and the Lincoln (Neb.) Journal Star, each up nearly 1 percent or more.

Among the 403 papers with circulations under 75,000, some 50 showed gains in circulation.

But perhaps the most positive thing to note about newspapers is that a good chunk of those circulation declines were managed, where publishers intentionally slashed what's these days referred to as junk circulation, papers being sent out to areas beyond the core readership or that are essentially given away.

Papers are trimming outlying circulation in order to focus on providing deeper coverage of their core markets. They are also doing it to save money, of course.
But it's a move that advertisers should welcome as well, since those outlying readers are not likely to be their target consumers. They lose nothing by seeing that circulation slashed. What they are left with is a more condensed readership, and those who are much more likely to buy their goods.

This trimming of junk circulation has been going on for several years, and it continues. Just today, the Atlanta Journal-Constitution said it planned to pare its daily circulation by about 2.2 percent, cutting its distribution area from 74 to 39 counties.

This managed paring of circulation would appear to explain much of the accelerating declines in newspaper circulation figures over the recent years.

Just how much is hard to say, but it could be as much as half. If that were the case for the most recent six-month period, the real decline in circulation would be not 3.6 percent but more like 1.8 percent, which is much more in line with declines of earlier years.

And if newspapers are losing readers, they are still hugely profitable, with margins still in the high-teen percentages. While the big focus is on trimming costs these days, their profitability allows them to spend where they need to, which is on the internet.

Newspapers struggled in the early years of the web, seeing it as a threat, but they've become increasingly adept at building up their sites and traffic in these past several years. They've done so well at it that they've actually increased their total readership, more than compensating for the declines in print circulation.

In first-quarter 2008, newspaper sites drew 66.4 million unique visitors, up 12.3 percent from the year earlier period, according to a Newspaper Association of America study.