Magazines

Effective Immediately
Effective immediately, the Board voted to modify existing consumer magazine report formats to permit the inclusion of a banner on the first page of a Publisher’s Statement notifying the industry of that publisher’s participation in the ABC Subscriber Profile program. The banner is optional; will appear only at the publisher’s request; and will be featured for 24 months following the completion of field study work.

First Passage
Effective December 2003, ABC’s Board voted to modify disclosure parameters surrounding premium reporting. A premium is defined as any extraneous item offered to either new or existing subscribers at the time of solicitation for a new or renewal subscription. Current parameters require that publishers using premiums provide full disclosure, including number of subscriptions sold that involved premiums; identification of the premium; any assigned retail value of the premium; and term and prices of the subscriptions sold with premiums. If approved at the November 2003 meeting, updated parameters would take effect in December 2003 and would make the reporting of term and price data optional.

Final Passage
Effective immediately (i.e., with June 30, 2003 Audit Reports), the Board voted to modify consumer magazine Audit Report formats so that Paragraph 1 is enhanced to show total circulation; and Paragraph 4A is augmented to not only show circulation by issue, but present publisher circulation claims, audit data, differences found and calculated percentages in a side-by-side, columnar format. Paragraph 4A will also show rate base by issue; and quarterly average reporting will be eliminated. Rule B2.2, Audit Report Contents and Differences, will be updated to eliminate the provision that quarterly averages be shown for the three years immediately preceding the audited period.

Unanimous Consent
Effective with the June 2004 Publisher’s Statement period, the Board voted to modify Rule F4.1, Publisher’s Statements, to stipulate that all Publisher’s Statements submitted to ABC for publication must be accompanied by forms and schedules deemed appropriate and necessary by ABC auditors. Publishers who do not submit these completed forms and schedules by the last day of the subsequent Publisher’s Statement period will have their report services suspended until such documentation is provided to ABC.

Unanimous Consent
ABC’s Board voted to modify Rule F8.9, Subscriptions Purchased with Award Points to stipulate that, effective with the June 30, 2004 Publisher’s Statement, publishers will be required to disclose subscriptions obtained through frequent-flyer redeemed subscription program by detailing in Paragraph 9 the average number of copies served in the period as reflected in Paragraph 1, Average Circulation.

Effective Immediately
Effective immediately, ABC’s Board voted to modify Rule F8.4, Subscription/Single Copy Sales in Combination, as it applies to “add-on” sales involving a magazine and a separate magazine. When occurring as part of a traditional renewal program, such sales will only qualify as paid when a qualifying amount is paid for all magazines involved. In situations where consumers are not given an opportunity to opt-in or opt-out of the add-on sale through incremental/decremental pricing, no promotional statement, inference or suggestion may position the added magazine as “free,” “a bonus” or “at no additional cost” regardless of the wording used. ABC’s Board also voted to grant final passage to a change in the same rule governing magazines sold with newspapers or business publications. In such situations, the subscriber must be given the clear opportunity to opt-in to (i.e., affirmatively choose) the added publication. This may be accomplished via the payment of an incremental dollar amount, or the offer of a reduced price should the subscriber elect not to receive the additional publication. When reporting average price, publishers would assign either the incremental dollar amount being charged (in situations where the publication is accepted) or the amount by which the subscriber may reduce payment (in situations where the publication is refused).

Effective Immediately
Effective immediately, the Board voted to augment current criteria for the reporting and qualification of electronically delivered consumer magazine editions. Complete, updated criteria are now as follows:

For Reporting

• The label “digital edition” must be used to describe copies distributed via electronic means
• Full disclosure of all digital editions is required
• Paragraph 1 must identify print versus digital editions
• Information regarding the service of duplicated subscribers must appear in Paragraph 9
• Separate analyses are required in all paragraphs reporting average paid, including Paragraph 4B or Paragraph 9 for Club/Membership, Partnership or Public Place/Sponsored Sales

For Qualification

• A qualified edition must remain consistent with the print version in both content and layout. The opportunity exists for advertising to be sold exclusive or inclusive of the electronic edition
• When downloading and/or viewing the edition, the format offered must display the complete edition, including all editorial and advertising content
• The edition provides readers the same opportunity to review advertising as its print counterpart
• The edition carries print publication pricing

Effective December 2003
Effective with the December 31, 2003 reporting period, ABC’s Board voted to modify Rule F2.1, Public Place/Sponsored Sales, also changing the reporting category “Public Place/Sponsored Sales” to “Sponsored Sales.” New rule language stipulates that publishers required to make reporting of third party sponsored sales in Paragraph 4B and/or Paragraph 9 of ABC reports are also required to provide separate reporting of average circulation served for the categories of “Public Place/Sponsored Sales” and “Individually Addressed Sponsored Sales.” This rule change does not modify current reporting requirements designed to determine whether total paid circulation from a third party sponsored sales program meets an established reporting threshold; but rather, distinguishes those copies intended for public place use from those that are individually addressed. Rule F1.4, Average Price; Rule F5.3, Distribution by Counties; and Rule F8.1, Subscriptions Received in Connection with an Advertising Contract will be amended to incorporate the new “sponsored sales” terminology.

Newspapers

Effective Immediately
Effective immediately, ABC’s Board voted to modify Rule C3.3, Third Party Sales to more clearly govern the qualification of third party sales involving an advertiser. Specifically, new rule language stipulates that newspapers and their associated cost must be identified separately when sold in conjunction with an advertising contract for copies to qualify as paid circulation. Publishers may utilize any of the three following methods for disclosing the cost of the newspapers:

1) Show the advertising agreement and newspaper purchase agreement on separate contracts
2) Include specific language regarding newspaper purchase price within the contract when the agreement includes both advertising and newspapers
3) Identify the newspaper purchase price as a separate line item within the contract when the agreement includes both advertising and newspapers

Effective Immediately
Effective immediately, the Board voted to modify Rule C9.1, Supplemental Analysis to exclude Canadian publications from the stipulation that TMC, EMC or similar newspaper distribution must be primarily delivered to a recipient’s home.

Effective Immediately
Effective immediately, the Board voted to establish an error threshold of up to 15 percent of Sponsored Third Party Sales, for a period of up to two years, for the category of Home Delivered Third Party Sales involving U.S. and Canadian newspapers. This is an extension of a one-year exception granted to Canadian newspapers, during which time ABC auditors examined both home delivered and single copy third party sales programs for newspapers. The auditors compared percentage of leftover and undistributed copies for single copy programs to the actual error results found in home delivered programs. ABC’s Board will review updates at each of its meetings.

Effective Immediately
Effective immediately, the Board directed ABC’s auditing staff to review the application and specific language contained within Rule C2.4, Separate Editions, to govern the way in which editions of a “home” paper are defined and reported. ABC staff will work with the NAA to review this rule and identify potential changes that would address content/identification parameters in the qualification of editions and disclosure requirements. These updates will be considered at the November 2003 meeting, when ABC’s Board will also examine criteria for the eligibility of unique editions for use in third party/sponsored sales programs.

Effective October 2003
Effective October 1, 2003, the Board voted to adopt parameters governing newspaper third party sales to stipulate the following:

• Qualified vendor third party/sponsorship sales programs must be limited to organizations that are essentially and primarily business-to-consumer oriented.
• Recipients of sponsored subscription programs extending longer than one month must receive initial notification that furnishes all information necessary to cancel delivery. In addition, they should receive at least monthly notification that communicates the sponsor’s identity.
• FSI advertisements need not be included in sponsor copy distribution to qualify the copy as an edition of the home paper.
• Bartered goods and services are acceptable currency for third party/sponsored sales, provided the value of the bartered goods/services is reflected in the publication’s accounting records in accordance with generally accepted accounting principles.

In addition, governing rule language will be developed by ABC’s auditing staff for consideration at the November 2003 Board meeting. ABC will also work with the NAA to consider avenues and reporting options that inform advertisers about planned third party/sponsored and/or bonus day programs; and to discuss operational issues related to separating delivery of these programs so that advertisers may target free-standing inserts exclusively to individually paid subscribers as desired.

Effective October 2003
Effective October 1, 2003, the Board voted to modify ABC policies to stipulate that duplicate home delivery distribution resulting from third party sales programs must be excluded from paid circulation. This includes “total market coverage” Sunday bulldog distribution that results in duplicate delivery to individually paid subscribers. Specifically, newspapers delivering a Sunday bulldog edition to their regular Sunday customers may not count the sponsored copy as qualified paid circulation.

First Passage
ABC’s Board voted to update and clarify Rule C2.11, Intermittent Subscriptions, to define “intermittent service” and to address the elements of emulated service and customer notification. Specifically, whenever intermittent (“bonus day”) service causes a subscribing household to receive an already established frequency during any seven-day period, the extra copy (or intermittent service) would qualify for inclusion in paid circulation only if the price paid by the consumer were a qualifying price for the other established frequency. If approved at the November 2003 meeting, this rule change would take effect immediately.

First Passage
The Board voted to modify Rule C1.2, Prices, and Rule C2.4, Separate Editions, to augment and refine the definition of newspaper “electronic edition.” Expanded parameters stipulate the following:

• An electronic edition that is a replica of an existing print edition will qualify as paid circulation provided it is sold at not less than 25 percent of the newspaper’s regular home-delivered basic price
• A sale that includes both print and electronic can only be counted as one unit of paid circulation
• Separate electronic editions may be sold
• Non-replica electronic editions will be considered on a case-by-case basis, so long as they are paid for at one of the qualifying rates stipulated above
• An electronic edition is defined as a newspaper delivered electronically that is consistent in content with the print version of the same newspaper
• Both “push” and “pull” methods of distribution are acceptable, although undelivered “bounce backs” must be accounted for and removed from paid circulation in accordance with guidelines currently employed by ABC’s business and farm divisions
• Electronic editions must be reported separately in ABC reports

Should revised rule language receive final approval at the November 2003 meeting, it would take effect immediately. The policy governing “bounce backs” associated with electronic “push” delivery is effective immediately.

First Passage
The Board voted to modify Rule C2.1, Circulation Averages, so that newspapers are now required to have in place necessary daily records to qualify circulation sales between 25 percent and 50 percent of basic prices per ABC’s expanded definition of paid circulation for U.S.-based newspapers, which became effective with September 30, 2001 Publisher’s Statements. As part of this change, newspapers must have these records in place no later than January 2004 in preparation for March 2004 audits and beyond. Should this update receive final passage at the November 2003 meeting, it would take effect immediately.

Informational
ABC’s staff will explore mandatory day-of-week newspaper reporting to become effective April 2005. In the short term, ABC will remove the minimum 5 percent variance criteria, permitting day-of-week reporting to be enacted by any member newspaper.

Newspapers/Magazines/B2B/Farm

Effective Immediately
Effective immediately, the Board voted to extend the duration of a general exception to ABC premium rules for a period of two years, so that publisher members are permitted to offer their print subscribers free or discounted access to their Web site or electronic edition provided there is no intent to claim any of this electronic distribution on ABC Publisher’s Statements.

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