Summary of March 2008 Board Actions

Schaumburg, Ill. (Mar. 18, 2008)—The following are highlights of the actions taken by the Audit Bureau of Circulations’ (ABC) board of directors at its meeting Mar. 12 –14. (Note: The full update to ABC’s bylaws and rules is regularly made available on ABC’s Web site within weeks following each board meeting.)

Unanimous Consent – Effective March 17, 2008
The board approved the standards for verified airline copies established by an ABC board subcommittee in December. The interim standards were developed as a follow-on to the board’s decision to expand the number of allowable copies in November 2007.

The approved standards for verified airline copies state that publishers may distribute up to two copies per flight, per issue based on the total number of monthly flights for an airline. A maximum of 8,000 copies per airline, per issue may be claimed as verified. These copies may be distributed on board the aircraft or at limited access airline clubs.

U.S. Newspaper Qualification and Reporting Changes
At the March 2008 meeting, the ABC board of directors gave initial approval to a broad set of strategic rule modifications for U.S. newspapers. These concepts were originally endorsed by the board at its November 2007 meeting. The changes will provide important data to advertisers, while more clearly defining paid circulation and creating a new “verified” reporting category for other circulation channels. They are also intended to simplify ABC rules, reduce certain audit costs and provide greater pricing and marketing flexibility for publishers.

The following are highlights from the U.S. newspaper qualification and reporting changes that will go into effect April 1, 2009.

• Ease certain reporting requirements for mid-size newspapers. Newspapers with average paid circulation of less than 50,000 will no longer be required to report averages for each day of the week. These newspapers will also have the option to be audited every other year, rather than annually. Previously, only newspapers with average paid circulation under 25,000 had these options.
• Implement a flexible pricing model where newspapers will be considered “paid” by ABC regardless of the price for which a copy or subscription is sold.
• Allow newspapers to convert current home-delivery subscribers to a greater frequency, provided the subscriber can opt out of the program, the new frequency is served for a minimum of 12 weeks, and advertisers are notified of such programs via ABC’s Web site at least 120 days in advance.
• Begin phasing out intermittent subscriptions from average paid circulation. In 2009, a maximum of 50 intermittent days may be claimed as paid. In 2010, the maximum drops to 25 days. In 2011, all intermittent subscriptions will be reported as “verified” circulation.

In addition to the above changes, the following rule modifications will take effect Oct. 1, 2010:

• Revise the definition of paid circulation so that it is more straightforward and represents payment by an individual reader or specialized distribution channel. Paid circulation will continue to be reported separately on ABC reports.
• Adopt a paid/verified model where “other paid circulation” (e.g., third-party sales, NIE copies and employee copies) will be reported as “verified” subscriptions.
• Reclassify copies distributed at hotels and subscriptions purchased by businesses for designated employees to a new paid-circulation category, “Business/Traveler.”

More detailed rule-by-rule changes, an implementation timeline and a prototype Publisher’s Statement will be posted on ABC’s Web site in early April. Meanwhile, ABC has launched a new U.S. Newspaper Qualification and Reporting Support Center that will house all of the information pertaining to the rule changes, including board actions, FAQs, resource guides and training opportunities.

Beginning in early May, members will have the opportunity to review all of the proposed new rule language. Following the member review period, the board will review the rule language for final passage at its July 2008 meeting.