Wednesday, June 29, 2005
Float or bloat
First Ringer's post of the suit filed against the StarTribune for inflated circulation figures interested me for a few reasons.
Side note: My uncle used to complain about returns at the Dover (NH) News, a distributor where he was a manager. But the best thing about that business was that they also distributed comic books, and all they had to return for credit was the cover. The rest ended up often at his apartment, where I would read the innards. This was also true with magazines -- I'm willing to bet he had some uncovered Playboys, as it were.
- I had no idea that there's a non-profit company keeping track of circulation figures, and that advertisers and papers were using that company's information to decide ad rates;
- Advertising is 84% of revenues for the paper.
- I had no idea the Fraters had such foresight as to have said on NARN last week many of the charges in the suit.
- The suit discusses "grace period" deliveries, so that when The Elder cancelled his subscription but continued to find the paper on his doorstep, the STrib "reports circulation revenue on its books from these unsold, freely delivered papers, but classifies them as ciruclation bad debts if subscriptions are not regained."
Plaintiffs believe and allege that Defendants charged them higher advertising rates based upon manipulated, inflated circulation figures, which upon information and belief were derived from various programs designed to manipulate circulation figures, including (1) requiring independent contractor distributors to leave newspapers at residential addresses that do not subscribe to the Star Tribune; (2) requiring distributors to dump unsold newspapers; (3) refusing to credit retailers with unsold newspapers and instead reporting unsold papers as sales; (4) implementing programs designed to inflate circulation numbers at schools and hotels; (5) "buying down returns", whereby the Star Tribune gave agents incentives not to report returns accurately.
Side note: My uncle used to complain about returns at the Dover (NH) News, a distributor where he was a manager. But the best thing about that business was that they also distributed comic books, and all they had to return for credit was the cover. The rest ended up often at his apartment, where I would read the innards. This was also true with magazines -- I'm willing to bet he had some uncovered Playboys, as it were.
