The last days of ink?

Newspaper Circulation Slides 2.6 Percent

Average weekday circulation at U.S. newspapers fell 2.6 percent during the six month-period ending in September in the latest sign of trouble in the newspaper business, an industry group reported Monday.

Sunday circulation also fell 3.1 percent at newspapers reporting to the Audit Bureau of Circulations, according to an analysis of the data by the Newspaper Association of America.

The declines from the same period a year ago show an acceleration of a years-long trend of falling circulation at daily newspapers as more people, especially young adults, turn to the Internet for news and as newspapers cut back on less profitable circulation.

In the previous six-month reporting period ending in March, weekday circulation fell 1.9 percent at U.S. daily newspapers and Sunday circulation fell 2.5 percent. By comparison, a year ago newspapers reported a 0.9 percent decline in weekday circulation and a 1.5 percent fall on Sundays.

Circulation at the country's three largest newspapers was relatively stable in the most recent reporting period, but many others showed significant declines.

Gannett Co.'s USA Today, the largest-selling daily, slipped 0.6 percent from the same period a year ago to 2,296,335; The Wall Street Journal, published by Dow Jones & Co., fell 1.1 percent to 2,083,660; and The New York Times rose 0.5 percent to 1,126,190.

Of the rest of the top 20 newspapers reporting, all but one, The Star-Ledger of Newark, N.J., posted declines generally ranging between 1 percent and 8 percent.

The San Francisco Chronicle, published by Hearst Corp., posted a 16.4 percent tumble in circulation as the newspaper slashed less profitable, heavily discounted and giveaway circulation subsidized by advertisers.

Circulation has been steadily declining at newspapers for several years as readers look to other media for news. Tougher rules on telemarketing have also hurt newspapers' ability to sign up new readers.

Newspapers also face sluggish growth in advertising, higher newsprint prices and increasing concern among investors about newspaper growth prospects. The second-largest newspaper publisher in the country, Knight Ridder Inc., is facing a revolt from two of its top shareholders, who want the company to be sold.

John Murray, the vice president in charge of circulation at the NAA, said on a conference call with reporters that despite the continued slippage in overall paid circulation, newspapers were retaining subscribers longer.

That can save newspapers money over time as costs fall for replacing subscribers who don't renew. Newspaper executives also say advertisers are increasingly looking for "quality" circulation, meaning copies that aren't sold at a discount or given away for free to people who might be less interested in actually reading the paper than someone who signed up and is paying full price.

To that end, newspapers are steadily reducing their reliance on telemarketing to replace lost subscribers since those readers are more likely to drop out. Telemarketing has also become more difficult and expensive after the national "do-not-call" law went into effect in 2003. As of 2004, the number of new subscribers from telemarketing fell to 30.9 percent versus 39.1 percent in 2002, the NAA says.

Newspapers are also hoping to keep subscribers longer by signing them up for recurring payment options such as automatic checking account deductions or credit card charges. Murray said the portion of papers using automatic payment plans rose to 15 percent last year versus less than 5 percent two years before that.

Stricter circulation reporting rules and increased caution following a circulation misstatement scandal a year ago have also led to publishers being more conservative in reporting their circulation figures, Murray said. "The price of making a mistake went up dramatically in terms of visibility and notoriety," Murray said.

Four major newspapers which had been barred from filing circulation data for the previous two reporting periods deferred making reports until their next six-month audits are complete. Those papers are Newsday of New York's Long Island; the Dallas Morning News; the Chicago Sun-Times and Hoy, a Spanish-language newspaper in New York.

Four other newspapers whose circulation was affected by Hurricane Katrina did not file statements with the Audit Bureau: The Times-Picayune of New Orleans; the American Press in Lake Charles, La.; The Beaumont Enterprise in Texas; and The Daily Leader in Brookhaven, Miss.