Leaked email raises questions over Fairfax circulation numbers

Fairfax Media has not been fully informing the market about the nature of about 20% of The Age’s circulation, an internal email published by Crikey today suggests.

The revelation has major implications for advertising rates in the already beleaguered newspaper industry across all of Australia’s major publishers. It could also lead to a shakeup of Audit Bureau of Circulation rules over what can be counted as an audited newspaper sale. Although it appears to accept that the email is genuine, Fairfax describes Crikey’s claims as “misleading and wrong”.

Age letter Crikey

Source: Crikey

According to the Crikey report, the 2007 internal note is marked “sensitive information” and points to a “significant risk to the business” if the information reaches the market. It is unclear who the author of the note is, or if they are a current member of Fairfax staff.

However, although it appears that the market may not have had a true picture of the newspaper’s circulation, Fairfax was technically operating within the ABC’s rules.   

Crikey says that the email states that 40,000 “educational copies” of Melbourne’s The Age were being distributed at schools and universities which was, says the newsletter, “30 times more than it was publicly disclosing”. Crikey also says it has a document that suggests 35,000 copies were going “through the secret channels”.

According to Crikey the email – part of a discussion over whether to separately distribute the title’s Education section – goes on:

“We would make the total volume of copies going through these channels a matter of public knowledge … we would effectively write down the value of advertising in weekday editions from 200,000 circulation to 160,000 circulation, causing a pretty hard sell for the advertising team.

“The flow-on effect would also affect the Sydney Morning Herald and probably every major masthead in Australia in a similar way — not so bad for your publication if you aren’t quite so reliant on advertising revenue (aka News Ltd) but a big problem for Fairfax.”

The issue arises because of the way that ABC audit rules are drafted. According to Crikey, they allow distribution of copies to educational institutions to be counted in some cases as regular subscriptions if they are technically distributed to an individual. But advertisers would be less keen to reach the newspaper’s audience if it is true that one in five copies are going to students.

In theory, advertisers, via their media agencies, may believe that have paid millions of more dollars for advertising than they should have.

At the time of posting, the ABC had not responded to Mumbrella’s invitation to comment.

This afternoon, Don Churchill, The Age’s publisher, issued the following statement:

“The Crikey article is misleading and wrong. It is based on an email over three years old, which contained scenarios that were rejected by senior management as inappropriate.

“The Age’s subscriptions and audit practices are fully and totally within the Audit Bureau of Circulation rules.

“None of the proposals covered within the leaked internal email were adopted by The Age senior management. The suggestion that The Age might separate its Education section from the main body of the paper was rejected.

“We have no proposal to change that position and The Age Education section remains part of the main paper.

“Like all our major competitor newspapers, The Age supports schools with a comprehensive education program aimed at developing students’ awareness of issues that affect our community.

“These papers are paid for by schools and are not individual subscriptions. These sales are reflected in our audited circulation figures under the ‘education’ channel and represent less than 0.4% of total circulation at June 2010, as per the Australian Bureau of Circulation (ABC) audit rules.

“We also offer subscriptions to tertiary students (as do News Ltd newspapers, including The Herald Sun and The Australian).

“The Age’s subscription offer to university staff and students, via the tertiary card, is open and transparent.

“I wish to reiterate that at all times The Age’s procedures have complied fully with the rules set down by the Audit Bureau of Circulations. Further, these are independently audited.

“It is also an utter fabrication that The Age sought to mislead our advertisers. It is absurd for Crikey, or anyone else, to imply that we would jeopardise these important commercial relationships by dealing with our advertisers and their agencies in anything less than a fully transparent way.”


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