DAILY PAPERS' CIRCULATION WOES PERSIST INTO '97: READERSHIP DROPS TO 59%; SUNDAYS DOWN TO 68.5%

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The circulation woes of leading daily newspapers continue, with the majority of the top 25 dailies either flat or down for the six-month period ended March 31.

Release of the latest Audit Bureau of Circulations figures coincided with that of a Newspaper Association of America study showing adult readership of daily newspapers dropped to 59% last year, from 64% in 1995. Sunday newspaper readership dropped from 72.6% to 68.5% in that time frame.

Most of the big metro papers were down in total circulation, the Audit Bureau reported, including The New York Times, The Washington Post, Chicago Tribune, Chicago Sun-Times, The Boston Globe, Houston Chronicle, The Dallas Morning News, The Miami Herald, The Philadelphia Inquirer, The (Newark, N.J.) Star-Ledger, The (Cleveland) Plain Dealer, and Minneapolis Star-Tribune.

NEWSPRINT INCREASES

"Many newspapers intentionally cut back on circulation when the price of newsprint increased and stayed high through early '96," said Kevin Levalla, managing partner at investment banker Veronis, Suhler & Associates. "Now it's up to newspapers to try and regain circulation and penetration in those core market areas."

USA Today President-Publisher Tom Curley said many newspapers also cut back their marketing efforts last year to offset paper price increases, a move he believes contributed to the overall industry decline.

"Newspapers were slow to go back and understand how much was lost when they cut back on marketing," he said. "Those effects have a longer lead time and I think we're still seeing some of that."

Those daily newspapers that bucked the trend included USA Today, Los Angeles Times, Newsday, New York Post, The Denver Post, The Arizona Republic, and The San Diego Union-Tribune.

USA Today saw its Monday-through-Thursday circulation rise 2.7% to 1.66 million while sales of the weekend edition rose 1.7% to 2.04 million.

Mr. Curley attributed the growth to an increase in business travelers, a key market for USA Today.

DISTRIBUTION AREAS

Weekday circulation of The Denver Post was up 11.9% to 353,786, while Sunday circulation was up 4.5% to 474,668. That growth has been attributed to the move by rival Rocky Mountain News to pull distribution from less profitable areas.

"That's called winning the battle, moving ahead," said Mr. Levalla. The Denver Post, he said, is "reaping the benefits" of its rival's strategy.

While Arizona Republic was up an impressive 11.6% in weekday circulation, some of that can be attributed to the consolidation of morning and evening editions in that market. On Sunday, the Republic was up just 1.1%.

The New York Post and suburban Newsday were the only gainers in the New York City area.

Newsday's daily circulation was up 0.7% to 559,233, while Sunday was up 0.5% to 646,446. The Post's daily circulation rose 2.4% to 428,401; its new Sunday edition, measured for the first time, showed a circulation of 290,532.

"We've been running counter to general newspaper circulation trends for the past three years," said Post President-Publisher Marty Singerman.

The Post relied on aggressive pricing strategies in both Staten Island and Brooklyn. At 50 cents, the new Sunday paper is also priced lower than any of the others in the market.

'DAILY NEWS' DROPS

The Daily News was down 4% in daily circulation to 728,107, while Sunday circulation dropped 15.4% to 854,815.

Fred Drasner, co-publisher and CEO, attributed Daily News declines to distribution snags experienced when a Brooklyn printing plant closed in January.

"We experienced problems with our new equipment in the New Jersey plants, which led to the papers getting to newsstands sometimes as late as 8 a.m. or 9 a.m.," said Mr. Drasner, adding that the problem was recently corrected.

He also attributed some of the decline to a 25-cent increase in the Sunday newspaper price, to $1.50, and the lower price of the Post.

The Los Angeles Times experienced a 4.7% jump in daily circulation to 1.07 million, while Sunday was down 2.1% to 1.36 million.

The Sunday decline was attributed to a home-delivery price increase in Orange County, as well as an overall trend of declining Sunday readership for newspapers.

The daily circulation benefited from a single-copy price cut and an aggressive

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