Board Actions

Summary of November 2012 U.S. Board Actions

November 20, 2012

Arlington Heights, Ill. (Nov. 20, 2012) — The following are highlights of the actions taken by the Alliance for Audited Media (AAM) board of directors at its meeting held on Nov. 14-16. (Note: The full update to AAM’s bylaws and rules is regularly made available on AAM’s website within weeks following each board meeting.)

BUSINESS PUBLICATIONS

Periodical Snapshot Report to Include Comparative Publisher’s Statement Data for Business Publications
Unanimous Consent – Effective with December 2012-ending Publisher’s Statements

The periodical Snapshot report, formerly known as FAS-FAX, has historically included audited data when available for year-over-year comparison purposes for business publications. To align business publications with all other media divisions, the AAM board unanimously agreed to modify the Snapshot report to always include publisher’s statement data for previous year comparisons.

Board Plans Next Stage of Business Publication CMR
For Information

The business publication buyer and publisher committees continue to discuss how the Consolidated Media Report should progress with the industry. These groups are working together to establish meaningful metrics, standard reporting and new standards for cost-effective, technology-based pass-along readership audits.  The committees will meet again in early 2013 and prepare an update for March.  

CONSUMER MAGAZINES

Board Outlines Plans for Converting, Qualifying Print to Digital Subscribers
Endorsement

As the magazine industry moves toward cross-platform media distribution, the AAM board is discussing guidelines for members that convert print publications to a digital format. New guidelines will address members that completely transition print to digital distribution as well as those that choose to supplement limited print distribution with digital access.

When converting print subscribers to digital, the board endorsed the following guidelines:

• All subscribers must receive communications about their publishing platform choices, whether they will continue with a digital subscription, convert the subscription to a different magazine or receive a cash refund for the remainder of the subscription due.
• The paid subscription status will be retained if the subscriber opts in to receive the digital magazine. This opt-in can be accomplished by taking several actions, including the subscriber making an individual request for the digital edition, activating an account specifically for the digital edition, or opening a digital edition issue within six months of notification that print is longer available.
• The default for subscribers who do not respond to the opt-in request will be either a cash refund or alternative print magazine subscription.  
• Publishers may offer merchandise as an incentive to convert print subscribers to digital.  The value of the merchandise offer cannot be more than the average subscription liability remaining. The publisher can also offer extra digital issues as an incentive. The term of the extra issues cannot be more than 25 percent of the original subscription term and no more than three months, consistent with post expiration rule service.

Magazines with Circulation Over 250,000 Required to Report Issue-by-Issue Data
First Passage

As part of an initiative to provide the marketplace with more frequent data, the board gave first passage to create Rule F 4.2 Rapid Report. U.S. magazines with circulation over 250,000 are required to report issue-by-issue data via AAM’s Rapid Report tool beginning with the July 2013 issue. Initial data must be submitted by the end of the month following the month of the issue. (For example, January data must be posted no later than Feb. 28.) Publishers may update the data through the time publisher’s statements are filed.

Rapid Report filing will remain optional for publications with circulation of 250,000 and under. 

Credit Cancelations to be Counted as Verified Circulation
First Passage

The board gave first passage to modify Rule F 8.14 Credit Subscriptions and Rule F 15.1 Verified Circulation. Copies served on credit but not paid may be claimed as verified individual use circulation. These copies can also be claimed as unpaid distribution. If these modifications are given final passage in March, rules are expected to be effective July 1, 2013.

Magazines Move to Adopt Scan-Based Trading Reporting Rules
First Passage

The magazine publisher and buyer committees have been discussing scan-based trading to determine newsstand sales for AAM reporting and working on a proposal to address some of the key audit verification issues, including identifying the issue date and “shrink”—the difference between the sales calculated from the physical inventory and copies listed as sold in the scan system.

The board gave first passage to create an allowance for shrink when scan-based information is used to report single-copy sales. The percentage of allowed shrink will be defined at the March meeting. New rules will also address assigning issue dates when alternating UPC codes aren’t used. Magazine publisher and buyer committees will continue to provide input regarding specifics of the new rule anticipated for final passage at the March meeting.  

Unlimited Magazine Access Programs Under Testing, Review
For Information

In an effort to work with publishers to test and navigate new digital programs, AAM is working with Next Issue Media, which offers unlimited access to magazines for a fixed price. AAM is extending its test period with Next Issue Media. Provided a subscriber selects a title and paid for the service, the subscription may count as a paid digital single copy. During the test period, AAM will review information related to subscriber behavior to include magazine selection/request, rate of issue download, and time spent with the issues. Upon completion of this review in the first quarter of 2013, publishers will develop a recommendation for future qualification and reporting standards for unlimited access programs such as Next Issue Media.

NEWSPAPERS

Newspaper CMR Task Force Testing ZIP Code Data Feeds
For Information

The joint publisher/buyer Consolidated Media Report task force continues to develop recommendations for reporting standards and formats, database integration of new metrics, and frequency of reporting.

A main focus for the group is more frequent data reported via an integrated online database. The task force requested AAM develop a paragraph 3 ZIP code input tool that several newspapers are now testing. The input tool for print circulation and digital metrics also being developed and is anticipated that it will be available for testing in early 2013.

As development of the input tools continues, the task force will seek feedback from the newspaper and buyer liaison committees to determine data format, participation requirements, filing deadlines, modifications after submission, and amount of historical data available. It is anticipated that the circulation and digital metric input tool, related output tools and rule language will be available for review at the March 2013 meeting. This would allow the interim filing procedures to launch in the second quarter of 2013.

Rule C 2.11 Intermittent Subscriptions Eliminated
Unanimous Consent – Effective Nov. 19, 2012

Rule C 2.11 previously described how publishers could qualify intermittent home-delivered circulation as paid circulation. At the July 2008 board meeting, the newspaper committee voted to phase out the subject rule over a period of time. The circulation defined by the subject rule is now reported as verified circulation. All audits for which publishers could have reported intermittent circulation as paid have now been completed and released, and the rule language is no longer applicable. The board unanimously agreed to eliminate the rule. Rules C 2.12 through C 2.14 will be renumbered C 2.11 though C 2.13.

Plans Underway for Integrating CAC Data in AAM’s Media Intelligence Center
For Information

On Nov. 2, CAC members voted to become a subsidiary of AAM. A key point of the acquisition was creation of a comprehensive database that will represent all AAM and CAC publisher members. Plans call for eventual complete integration of AAM and CAC member data into AAM’s database, the Media Intelligence Center, as well as an environment to house historical CAC reports. This multi-phase data integration project is slated for completion in summer 2014. Phases include:

1. Overhaul CAC’s website and create an environment to house historical CAC reports.
2. Provide user access to current circulation reports and top-line data in AAM’s Media Intelligence Center. Due to different nomenclature and qualification standards, AAM and CAC data will be segregated.
3. Incorporate quarterly average reports into ABC’s online database.
4. Completely integrate AAM and CAC data. This data originates from audit reports, so results of this phase will likely not be evident until summer 2014.

Newspaper Committees Discuss Possible Changes to Circulation Average Calculations
For Information

According to Rule C 2.1 Circulation Averages, daily newspapers with an average circulation of 50,000 copies per issue or more must report circulation by day of the week and a five-day average. These Monday through Friday averages are commonly reported as the daily average in AAM products and used for comparisons.

As the newspaper industry continues to embrace digital platforms, some daily newspapers are forgoing print distribution on select week days. In anticipation of additional newspapers adopting similar business models, the newspaper committees are considering whether modifications to rule language and report formats are necessary.

OTHER DEVELOPMENTS

New U.S. and Canadian Directors Elected to North American Board
For Information

The following new directors were elected to AAM’s North American board:

• Sue Roberson, Time Inc., representing U.S. magazines (one-year term)
• Lou Cona, Condé Nast, representing U.S. magazines
• Alisa Bowen, Dow Jones representing U.S. newspapers

Other Directors Re-elected, Slate of Board Officers Announced
For Information

The following directors were re-elected to serve two-year terms unless otherwise noted.

U.S. Advertisers

• Stacy Boone, Target Corporation
• Ed Cicale, AutoNation, Inc.
• Jeffrey Holecko, Kimberly-Clark
• Bill Stabile, Siemens Corporation

U.S. Advertising Agencies

• Merle Davidson, ACG Media
• Steve Mueller, NSA Media
• Suzanne Silber, Carat

Canadian Advertising Agencies

• Sunni Boot, Zenith Optimedia

U.S. Magazines

• Dave Leckey, American Media, Inc.
• Terry Snow, Bonnier Corporation

U.S. Business Publications

• Rob Fisher, American City Business Journals

U.S. Newspapers

• Caroline Diamond Harrison, Staten Island Advance
• Scott Heekin-Canedy, The New York Times

Canadian Newspapers

• Gordon Fisher, Postmedia

AAM Board Officers (one-year term)

• Chairman – Sunni Boot, ZenithOptimedia Canada Inc.
• Vice Chairman – David W. Leckey, American Media Inc.
• Vice Chairman – Christina Meringolo, Merck Consumer Care
• Vice Chairman – Scott Kruse, GroupM
• Vice Chairman – Shelagh Stoneham, Rogers Communications Inc.
• Secretary – Rob Fisher, American City Business Journals
• Treasurer – Scott Heekin-Canedy, The New York Times