Newspaper Circulation Down 2.5 Percent

NEW YORK, May 9, 2006 -- Daily circulation fell 2.5 percent at U.S. newspapers in the six-month period ending in March, according to data released Monday, reflecting the industry's ongoing struggle to retain paying customers amid competition from the Internet and other media outlets.

The Newspaper Association of America, analyzing data from the Audit Bureau of Circulations, also reported that Sunday circulation fell 3.1 percent at the 610 newspapers reporting those figures. The 2.5 percent decline in average paid weekday circulation was based on data from 770 newspapers reporting to the Audit Bureau.

The overall decline in both weekday and Sunday circulation were approximately the same as those given in the previous six-month reporting cycle for the period ending last September.

Newspaper circulation has been in general decline for years as many people, particularly young adults, turn to other media outlets including cable TV and the Internet for news and information. Also, tougher rules on telemarketing have forced newspapers to find other ways to attract new readers.

Despite the decline in paid copies, newspapers are seeing a greater number of visitors to their websites. The NAA also reported Monday that newspaper-run sites had an overall eight percent increase in viewers in the first quarter.

The data from Nielsen/NetRatings found that newspaper websites averaged 56 million users in the period, or 37 percent of all online users in the period, the NAA said.

Revenue from online advertising is growing quickly - about 25 percent to 30 percent a year - but still makes up a relatively small portion of newspapers' overall advertising revenue at about five percent, John Kimball, the chief marketing officer of the NAA, told reporters on a conference call.

On the whole, most newspapers are showing declining circulation. John Murray, the NAA's vice president of circulation marketing, said on the call that just one in four newspapers showed increases in weekday circulation in the latest reporting period, while one in five had gains on Sunday.

The largest newspapers held up relatively well, with USA Today notching a 0.09 percent gain to 2,272,815 copies, remaining the top-selling newspaper in the country. The Wall Street Journal was second with 2,049,786, down one percent, and The New York Times was third, with an increase of 0.5 percent to 1,142,464 copies.

Several other major papers reported declines, with the largest by far coming at the San Francisco Chronicle, where average paid weekday circulation fell 15.6 percent to 398,246.

Patricia Hoyt, a spokeswoman for the Chronicle, said the newspaper began cutting back on certain kinds of circulation at the beginning of last year such as copies paid for by advertisers and then distributed for free. The cutbacks involve copies that "advertisers didn't value, were quite costly and essentially had no impact on our readership."

The Chronicle, which is owned by Hearst Corporation, reported a similar decline in paid circulation for the previous six-month reporting period that ended last September.

Several other top newspapers reported declines, including Tribune Company's Los Angeles Times, down 5.4 percent at 851,832; The Washington Post, down 3.7 percent at 724,242; the New York Daily News, also down 3.7 percent at 708,477. News Corporation's New York Post slipped 0.7 percent to 673,379.

Among other large papers, The Boston Globe fell 8.5 percent to 397,288, and The Atlanta Journal-Constitution fell down 6.7 percent to 365,011. The Globe is owned by The New York Times Company and the Journal-Constitution by Cox Enterprises Incorporated.

Besides USA Today, a handful of other major newspapers also reported modest circulation gains: Tribune's Chicago Tribune, up 0.9 percent at 579,079; and The Star-Ledger of Newark, New Jersey, up 0.9 percent at 398,329. The Star-Ledger is owned by Advance Publications Incorporated.

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