Consumer Magazines

Effective Immediately

Modify ABC’s current consumer magazine digital edition policy:

1. to eliminate the requirement that the digital edition carry print publication pricing
2. to include delivery issue “bounce backs” in qualified circulation for a limited time frame, provided the delivery issue associated with the bounce back is rectified or the subscriber is purged from the subscriber file according to the following timetable:

   Daily	10 issues
   Weekly	4 issues
   Biweekly	2 issues
   Monthly	1 issue

3. for sponsored sales, to include the requirement that the intended recipient must actually request the sponsored copy in such a way that the request can be verified; and to defer the requirement that the intended recipient must actually download or access the digital issue, pending exploration into appropriate and effective audit methodologies for such activity.

Effective December 2004

Effective with the December 2004 reporting period, modify criteria surrounding Rule F5.2, Distribution by ABCD County Size, so that Canadian county sizes are grouped according to a Census-based cutoff between population characteristics. This will potentially re-distribute the number of Canadian publications reporting within each respective, designated county size. Also, U.S. publications with a Canadian circulation of 70,000 or more will be required to declare a Canadian county size based upon these new parameters.

New criteria used for establishing ABCD groupings is as follows:

A - All counties which are, in whole or in part, within the boundaries of Census Metropolitan Areas of 900,000 population or over based on population counts for the 2001 Census.

B - All remaining counties which are, in whole or in part, within the boundaries of Census Metropolitan Areas and other counties which are, in whole or in part, within the boundaries of Census Agglomerations of 70,000 population or over and other counties containing a place of 70,000 or more population not officially designated as a Census Agglomeration.

C - All remaining counties which are, in whole or part, within the boundaries of Census Agglomerations of less than 70,000 population and other counties containing a place of 15,000 or more population.

D - All remaining counties.

Effective Immediately

Update application of Rule F2.6, Partnership Sales and Rule F2.7, Club/Membership Subscriptions, so that partnership sales rules may apply in situations where a society promotes the availability of a print subscription to society members and the consumer is made aware that 1) the cost of the subscription is included in society dues, and 2) the consumer may decline and receive a refund for the amount of the publication from the publication itself. Previously, Club/Membership rules have applied in this sitation; these rules stipulate that, in deductible transactions, the dues invoice must provide for a reduction in the invoice amount at the time membership dues are paid.

Effective Immediately

Effective immediately, and through June 2005 Publisher’s Statements and Audit Reports, allow magazine members required to disclose sponsored sales in either Paragraph 9 or Paragraph 4b to optionally provide further analysis of sponsored circulation by type: either “individually addressed” or “public place,” provided adequate records are available to support those claims. Additionally, suspend provisions of Rule F2.1, Sponsored Sales, for those magazines preferring to only report sponsored circulation without further analysis, or those not having sufficient records to make the analysis.

Newspapers

Effective Immediately

Effective immediately, modify 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.

Updated rule language is as follows:

C 2.11 Intermittent Subscriptions

When a publisher of a newspaper elects to serve intermittent subscriptions, the circulation of those intermittent days may be included in paid circulation provided the publisher maintains records to substantiate that the copies so distributed qualify as paid circulation in accord with Rule C 1.1 . When such service equals or exceeds eight days in any publisher's statement period, "average intermittent subscriptions" shall be reported as a separate line item in Paragraphs 1 and 2 of Publisher's Statements and Audit Reports within the markets in which they exist.

In addition, when the eight day limit is exceeded, the explanatory paragraph shall include complete information on the specific days to include the date and circulation for each date.

a) Intermittent service is the occasional delivery of issues not specifically included in the new or renewing contract between the publication and the consumer, and therefore not part of the established frequency ordered by the consumer.

b) In order to qualify for inclusion in paid circulation, the following conditions must be met

(1) Intermittent service is to be made to all eligible subscribing households within a market (e.g. City Zone, Newspaper Designated Market, etc.)

(2) All households scheduled to receive intermittent service must be notified of the impending delivery at least two weeks prior to the distribution date.

(3) If, over the course of any seven day period, the delivery of an intermittent service copy results in the emulation of another established frequency, the aqmlount paid by the recipient of intermittent servie must be at least a qualifying amount, based on a pro rata of the basic price for the other established frequency.

c) When such service equals or exceeds eight days in any Publisher’s Statement period, “average intermittent service” shall be reported as a separate line item in Paragraph 1 and 2 of Publisher’s Statements and Audit Reports.

d) When “average intermittent service” is reported in Paragraphs 1 and 2, the paragraph devoted to general explanations shall include information as to the specific dates intermittent service occurred and the paid circulation resulting from intermittent service for each of the dates.

Effective Immediately

Effective immediately, modify Rule C2.4, Separate Editions, to augment and refine the definition of newspaper “electronic edition.” Expanded parameters stipulate the following:

• An electronic edition is defined as a newspaper delivered electronically that is consistent in content with the print version of the same newspaper
• An electronic 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
• Both “push” and “pull” methods of distribution are acceptable, although effective in July 2003, 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

Updated rule language is as follows:

C 2.4 Separate Editions [section (a) (4) only]:

(a) (4) Electronic editions must be consistent in content with the print version of the newspaper. Circulation of electronic editions (net of undelivered copies) is to be reported separately on ABC reports.

Effective Immediately

Effective immediately, modify Rule C2.1, Circulation Averages, so that newspapers are 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.

Updated rule language is as follows:

C 2.1 Circulation Averages

All Publisher's Statements and Audit Reports shall include a calculation of circulation averages for the period covered by the report which will be presented in the following manner: "Paid for by Individual Recipients (sold at 50 percent or more of basic prices"); "Paid for by Individual Recipients (sold at or more than 25 percent but less than 50 percent of basic prices"); "Other Paid Circulation."

Only those newspapers that maintain daily records itemizing the amount of circulation that falls into the “more than 25 percent but less than 50 percent of basic prices” category will be eligible to include sales at less than 50 percent of basic prices in total average paid circulation.

In addition, average circulation by reporting geography (e.g. City Zone, Retail Trading Zone, Newspaper Designated Market, etc.) shall be shown in a separate paragraph.

Informational

Continue to explore mandatory day-of-week newspaper reporting to become effective April 2005 for March audits; and October 2005 for September audits. Also, consider making day-of-week reporting optional for newspapers with less than 25,000 net paid circulation unless any one day is at least 15 percent higher or lower than the other days (in which case, day-of-week reporting would be required). In the interim, continue to suspend the minimum 5 percent variance criteria, permitting day-of-week reporting to be enacted by any member newspaper.

Effective Immediately

Modify policies surrounding third party purchases of electronic editions, and electronic editions sold to business organizations and libraries, to include user-licensed sales at a qualifying price.

Effective Immediately

Modify policies surrounding third party purchases of electronic editions for registered college students, so that copies accessed by registered students, faculty and staff may be counted as paid circulation so long as a qualifying price is collected from the participating college. The copies in question would be counted under the category of “Other Paid, Educational Programs - Registered College Copies - Electronic Edition.”

Effective Immediately

Effective immediately, update Rule C5.3, Premiums with Combination Sales, and Rule C5.4, Subscriptions/Single Copy Sales in Combination, as they apply to “add-on” sales involving a newspaper and a 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 publications 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 publication as “free,” “a bonus” or “at no additional cost” regardless of the wording used.

Updated rule language is as follows:

C 5.3 Premiums with Combination Sales [section (a) only]

(a)When a premium is used in connection with a combination of newspapers the amount paid by the subscriber must not be less than 25 percent of the total value of all the subscriptions in the combination based on a pro rata of the basic annual subscription prices plus the value of the premium whether stated or not. When the value of the premium is not stated or when value stated is less than the cost of the premium to the publisher, the value shall be established in the same manner described in as defined in Rule C 5.2 plus the amount required by Rule C 5.4.

C 5.4 Subscriptions/Single Copy Sales in Combination [section (d) only]

(d) Copies served to existing and renewing newspaper subscribers offered a combination sale of magazine may qualify as paid under one of the two following conditions:

(i) The offer to "add on" the combination magazine requires an affirmative act on the part of the subscriber and incremental payment beyond the rate of the existing contract, or an option to reduce the rate of the existing contract if the offer is declined. The amount of incremental payment or reduction of rate from the existing contract must be clearly disclosed, and must be at least a qualifying amount as defined by the publication paid circulation defined rules.

(2) The offer to "add on" the combination publication requires notification to the subscriber and promotion materials shall not imply nor suggest that the add on magazine is "free" or "at no additional cost." The amount being paid for all publications involved in the combination must be at least a qualifying amount as defined by the publication paid circulation defined rules.

(e) Existing and renewing newspaper subscribers offered a combination sale to include a business publication, farm publication, or another newspaper, may qualify as paid under the following conditions:

(1) The offer to "add on" the combination publication must require an affirmative act on the part of the subscriber; offers requiring the subscriber to decline the combined publications if it is not desired will not qualify the sale as paid circulation.

(2) The offer to "add on" the combination publication must require either incremental payment beyond the rate of the existing contract, or an option to reduce the rate of the existing contract if the offer is declined. The amount of the incremental payment or reduction of rate from the existing contract must be clearly disclosed, and must be at least a qualifying amount as defined by the publication paid circulation defined rules.

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