Virtual Press RoomBoard Actions
Summary of July 2009 U.S. Board Actions
Schaumburg, Ill. (July 28, 2009)—The following are highlights of the actions taken by the Audit Bureau of Circulations’ (ABC) board of directors at its meeting held on July 22 – 24. (Note: The full update to ABC’s bylaws and rules is regularly made available on ABC’s website within weeks following each board meeting.)
BUSINESS AND FARM PUBLICATIONS
Separate Business and Farm Publication Rules Approved for Canadian Members
Unanimous Consent – Effective July 27, 2009
In March 2009, the ABC board of directors voted to form the ABC Canada Board Committee 
and develop separate ABC rules for all Canadian publishing divisions. With the creation of separate Canadian rules for business and farm publications, ABC staff has removed all references to Canada from the Chapter D rules (D 1.1 – D 15.1) and the Chapter E rules (E 1.1 – E 13.1) that now govern U.S. and international titles. No other changes were made to the rules.
Board Agrees to Make Several Paragraphs Optional
First Passage – Effective with December 2009 Publisher’s Statements
The board gave initial approval to make the following paragraphs optional for all U.S. business publication members: Paragraph 3C Mailing Address Analysis, Paragraph 6 Term Data, Paragraph 7 Sales Channels, Paragraph 8 Premium Usage and Paragraph 9 Post-Expire Copies Included in Paid Circulation.
To accomplish this, the board gave first passage to modify the following rules: D 5.4 Mailing Address, D 10.1 Channels of Subscription Sales and D 4.1 Publisher’s Statements.
ABC’s business publication advisory committees will provide recommendations to the ABC board at the November meeting regarding disclosure and numbering scheme for the optional paragraphs.
CONSUMER MAGAZINES
Partnership Rules Expanded to Allow More Than One Magazine in an Offer
Unanimous Consent – Effective July 27, 2009
The board agreed to amend Rule F 2.6 Partnership Sales to allow more than one magazine to be bundled with the purchase of a consumer good provided the following criteria are met:
- No more than three magazines are included in any partnership offer.
- The partner organization is limited to an online or catalog outlet. Other partner organizations, such as a retail location, are still limited to one magazine per partnership sale.
- A tiered purchase is required. The greater the merchandise purchase price, the more magazines that can be included in the offer. For example, a customer who purchases $25 of merchandise may qualify for one magazine; a customer who purchases $50 of merchandise may qualify for two magazines; and a customer who purchases $75 of merchandise may qualify for three magazines. In another example, a tiered purchase could be related to the number of items purchased instead of a dollar amount: a customer who purchases one product may qualify for one magazine; a customer who purchases two products may qualify for two magazines; and a customer who purchases three products may qualify for three magazines.
- The consumer must be able to opt out of each magazine; however, all refunds must be available through a single-refund request and that request must be a one-step process.
- The consumer must take affirmative action to select the magazines included in the offer.
- Clear and reasonable language must be used in all offers, including the language used for refund requirements and cancellation and auto-renewal policies.
- All other partnership sales criteria must be met.
Premium Defined and Combination Sales Rules Modified
Unanimous Consent – Effective July 27, 2009
The board also agreed to modify Rules F 8.1 Premium Defined and Rule F 8.4 Subscription/Single-Copy Sales in Combination to state that if two or more consumer magazines are sold together, the combination sales rule applies regardless of the frequencies of the magazines. To qualify as paid circulation, the publisher must collect at least the full value of the higher-priced magazine along with at least one cent for the lower-priced magazine.
Previously, ABC rules stated that when two periodicals were sold together and one periodical had a publishing frequency of less than once every three months, that periodical was a premium and the sale and resulting circulation were governed under the premium rules.
Guidelines for Magazines Affected by Anderson News Approved
Unanimous Consent – Effective for June 2009 Publisher’s Statements
Earlier this year, a major national newsstand magazine wholesale and distributor—Anderson News—ceased operations, leaving many U.S. magazine publishers with incomplete draw and return information.
The board agreed to the following actions for ABC consumer magazine members affected by Anderson’s closure. In all ABC reports, a full explanatory will be made noting the issues impacted by the Anderson closure.
- Incomplete Returns
- For regular issues of any magazine, regardless of frequency, the publisher should calculate the average Anderson sell-through percentage for the six-month period January through June 2008. This percentage should be applied to any Anderson draw known to be distributed to a retail outlet for sale, but has incomplete return information.
- For special or seasonal magazines, the publisher should calculate the average Anderson sell-through percentage for the corresponding issues in both 2007 and 2008. This percentage should be applied to any Anderson draw known to be distributed to a retail outlet for sale, but has incomplete return information
- Draw Not Delivered – In some situations, the draw for specific issues was never delivered to the retail outlets. Because the issues were never delivered, no circulation can be claimed on ABC reports.
- Reporting of Geographic Data – Magazines affected by the Anderson closure may report state geographic data based on the single-copy percentages reported on the December or June 2008 Publisher’s Statement.
Separate Consumer Magazine Rules Approved for Canadian Members
Unanimous Consent – Effective July 27, 2009
In March 2009, the ABC board of directors voted to form the ABC Canada Board Committee and develop separate ABC rules for all Canadian publishing divisions. With the creation of separate Canadian rules for consumer magazines, ABC staff has removed all references to Canada from the Chapter F rules (F 1.1 – F 16.1) that now govern U.S. and international titles. No other changes were made to the rules.
ABC Reviews Impact of Scan-Based Trading
For Information
Scan-based trading has been a subject of discussion in the magazine industry for years. As the practice achieves greater acceptance and usage, several issues have arisen that affect ABC reporting. To fully grasp these issues and understand their potential impact for buyers and sellers, ABC’s two advisory committees—the Magazine Directors’ Advisory Committee and the Magazine Buyers’ Advisory Committee—have begun regular discussions about the key issues, including the lack of issue-by-issue data from many scan-based systems and “shrink”—the difference between the sales calculated from the physical inventory and copies listed as sold in the scan system. Both committees and a separate scan-based trading task force will continue to work toward an industry resolution and will provide ongoing updates to the ABC board.
Board Approves Testing of Gift Box Programs
For Information – Available through the December 2010 Reporting Period
The board approved the testing of consumer magazine gift box programs where several magazines are bundled and sold together in a gift box.
The board agreed to the following guidelines for gift box programs:
- The magazines included in the gift box will count as paid single-copy sales.
- Publishers must collect at least 100 percent of the cover price for the highest-priced magazine in the gift box and no less than 25 percent of the cover price for all other magazines included in the gift box.
- During this test period, publishers may include as paid circulation those issues that become back copies during the on-sale period.
For more information about the testing of gift box programs, members are encouraged to contact their Publisher Relations managers.
NEWSPAPERS
Weekly Newspaper Group Audit Plan Changes Finalized
Final Passage – Effective July 27, 2009
The board granted final approval to modify Rule C 2.13 Weekly Newspaper Group Audit Plan to make geographical reporting optional. This includes the distribution of copies in a definable market area and the Audit Report map that identifies the market and the geographic location of each newspaper in the group.
Reporting of “Power Days” Finalized for Newspapers with Circulation of 50,000 or Less
Final Passage – Effective July 27, 2009
Following the board’s action to eliminate the day-of-week reporting requirement for newspapers with average weekday paid circulation of 50,000 or less, the board further modified Rule C 2.1 Circulation Averages to allow these newspapers to report “Power Days.” This would allow U.S. newspapers that do not report their circulation by day-of-week to report certain daily circulation averages in a separate column. Examples include food days or a Friday-Saturday average.
Newspapers No Longer Required to Provide 14-Day Advance Notification of Third-Party Programs
Final Passage – Effective July 27, 2009
Rule C 3.3 Third-Party Sales was modified to require publishers to notify ABC 14 days in advance of a third-party program only if circulation generated from their total third-party sales programs represents four percent or more of the total paid circulation reported on the most recent Publisher’s Statement. From time to time, the ABC audit manager may also request 14-day advance notification to conduct field testing necessary to complete the audit.
Board Agrees to Continue Testing the Newspaper Consolidated Media Report Program
Unanimous Consent – Effective July 27, 2009
One year ago, the ABC board agreed to test a new optional consolidated report that allows newspapers to display a variety of print, online and audience data.
Last month, ABC released the first newspaper Consolidated Media Report for the Chicago Tribune and the Tribune Media Group. Response from the newspaper industry has been favorable and nearly 20 newspapers and newspaper companies have inquired about the report.
At this meeting, the board voted unanimously to continue the program on a test basis for one more year.
Changes to Premium Rules Accelerated, Now Effective for September 2009 Publisher’s Statements
Unanimous Consent – Effective July 27, 2009 for September 2009 Publisher’s Statements
At the July and November 2008 meetings, the board gave final approval to modifications to Rule C 5.1 Premium Defined and C 5.2 Premiums with Subscriptions/Single-Copy Sales that eliminated the requirement to report the premium and the number of subscription sales involving premiums effective Oct. 1, 2010.
At this meeting, the board agreed to make the changes effective with September 2009 Publisher’s Statements to align them with similar simplified reporting requirements such as reduced prices and combination sales.
Board Approves New Audit Program for Community Newspapers
First Passage – Effective Jan. 1, 2010
The board gave initial approval to launch a new Community Newspaper Audit (CNA) service for newspapers with less than 25,000 total average paid circulation. The new service aims to reduce costs, streamline the audit process and simplify rules and reporting for publishers. The new Community Newspaper Audit program is expected to launch Jan. 1, 2010. It will feature:
- All-inclusive fees that begin at a flat annual rate of $2,000 per year
- Streamlined, off-site audits that occur every other year and require less publisher preparation and involvement
- Simplified rules and reporting requirements
- Inclusion in FAS-FAX and ABC’s searchable online database
- Flexible billing options
NAA/ABC Vision Committee Provides Update to the Board
For Information
At the March 2009 board meeting, ABC and the Newspaper Association of America agreed to form a strategic task force to study the evolution of newspapers and the rapidly growing channels available to advertisers. The group, comprised of publishing and advertising executives, agreed to examine evolving newspaper publishing plans, print/digital hybrid models, targeted niche publications, e-readers and mobile platforms.
At the July meeting, the task force provided a progress report to the ABC board and plans to deliver recommendations for changes to ABC rules, definitions and report formats at the November meeting.
OTHER DEVELOPMENTS
Board Votes to Maintain Current Audit Rates and Fees
For Information
In light of the current economic conditions and in an effort to control costs, the board voted to maintain ABC’s current audit rates and other fees for the next year. ABC has not increased its rates or fees since January 2007.
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Corporate Communications Contacts: | ||
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Executive Vice President, Strategic Planning, Communications and General Manager, ABC Interactive t: 224-366-6363 |
Manager, Communications t: 224-366-6365 |
Assistant Manager, Communications t: 224-366-6432 |
