'BusinessWeek' Misses Rate Base, Reaches Out to Advertisers

Audit Statement Revised Under New Rules Adopted Last Month

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NEW YORK (AdAge.com) -- BusinessWeek magazine is moving to mollify marketers after a report last week showed that the title missed the paid circulation it guarantees to advertisers every week during the 12 months that ended June 30, 2004.

'BusinessWeek' said it would address advertisers' concerns.

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It missed that rate base, which is set at 970,000, by an average of 4.5%.

'Reaching out to advertisers'
"We are reaching out to advertisers to address any concerns they may have," said Kimberly Quinn, a spokeswoman at BusinessWeek, which is part of the McGraw Hill Co. "We will address their concerns."

The New York Post reported Aug. 8 that the Audit Bureau of Circulations had filed a revised audit statement that lopped an average of 59,572 copies from the magazine's paid circulation count.

ABC acted under new rules, adopted by its board in July, that disqualify any recent circulation derived from EBSCO Consumer Magazine Services, a subscription agent, or InFlight Newspapers and Magazines, a sponsor.

Ms. Quinn confirmed that the change reflected the elimination of EBSCO subscriptions. As ABC promised last month, the revised audit is opaque. It does not indicate why 59,572 copies were struck from the paid circulation column or why 58,121 copies showed up as non-paid circulation where there were none before.

Professional offices
"The subscriptions in question were mailed to professional offices like doctors' offices," Ms. Quinn said. "We verified that the expected readers were delivered to advertisers." BusinessWeek "promptly" stopped doing business with EBSCO after it learned of ABC's concerns about the company in December 2004, she added.

The magazine is nonetheless preparing for another revision to circulation figures that it has filed with ABC, this time for the 12-month period that ended this June. "We expect a minor impact and we are addressing this with advertisers now," Ms. Quinn said. She estimated that the revision will affect less than 1% of BusinessWeek's paid circulation.

More magazines are likely to suffer the same kind of scrutiny and see some circulation struck from the "paid" column, but the scale will remain unclear until each title receives a fresh look from ABC.

Time Inc. titles
Time Inc., the publisher of BusinessWeek rival Fortune magazine, expects "minimal" exposure on the issue, said Susan Brown Williams, a spokeswoman for Fortune and Fortune Small Business. "The overwhelming majority of our titles never authorized the EBSCO program in question," she said. "The few that did and counted the subscriptions as paid ceased selling activity at the end of the first half of 2003." She declined to discuss Fortune individually.

While some Time Inc. titles participated in InFlight programs during 2004, most of the reported subscriptions will bear up under the new ABC rules, Ms. Williams said. InFlight stopped paying publishers for their magazines in the second half of last year.

Current advertisers in BusinessWeek include Microsoft, Sun Microsystems and the United Parcel Service.

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