Magazine Circulation Battle Looms Over Paid vs. Verified

Audit Bureau Won't Count Copies in Public Places; Buyers Say They Won't Pay

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NEW YORK ( -- The next big fight between advertisers and magazine publishers starts today. When the big consumer titles' first-half circulation figures are released by the Audit Bureau of Circulations, plenty will show average paid totals below last year's levels because, for the first time, they can't count waiting-room and other public-place copies as "paid" -- under any circumstances.
Copies in doctors' offices and other public places will now count as 'verified,' not as 'paid.'
Copies in doctors' offices and other public places will now count as 'verified,' not as 'paid.' Credit: AP

Two categories
Instead, those copies will now be known as "verified" and be put in a separate basket from paid copies. So will advertisers pay as much for "verified" circulation as they did when that same circulation was called "paid"?

"No," said Eric Blankfein, senior VP-director of communication-channel planning, Horizon Media. "There could be a big backlash to all this unqualified readership that was present all along. I think the publishers would be crazy to push for advertisers to cover this cost."

"It brings into question," Mr. Blankfein added, "the methods and quality of readership up to now."

But publishers argue that there is plenty of value in public-place copies in doctors' offices, hair salons and elsewhere -- along with copies sent to individuals who seem like good prospects.

It is far from clear which side has the stronger hand to play.

Time Inc., Mediaedge:cia
Earlier this year Time Inc., the country's biggest magazine publisher, partnered with Mediaedge:cia -- from across the bargaining table -- to study the subject, coming up with a report that essentially validated the worth of public-place copies. (Advertising Age reported on the study in April but Time Inc. reminded the industry with a timely press release about it last week.)

John Squires, co-chief operating officer, Time Inc., said copies called "verified" are the same copies that were called "paid" before -- so advertisers ought to pay as much as ever.

"The real question should be whether that copy is being read," he said. "If the end user is reading the magazine, why should it matter what we call it? Getting caught up in these labels is intellectually lazy because, in fact, look at the amount of free media that's out there that commands enormous ad spending."

Audience vs. consumer
While everything from TV to billboards have indeed pegged ad rates to audiences instead of paying consumers, however, publishers have justified rates by pointing to paying readers. Their willingness to spend money on magazines, the argument went, proved that these people were engaged.

Then circulation scandals hit and scrutiny of "paid" figures increased. Partly in response, the Audit Bureau of Circulations created the "verified" category last November -- effective today. Now we will see who pays.
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