Circulation Bureau Revamps Auditing Practices
ABC also found that technology publisher Ziff Davis Media overstated paid circulation for PC Magazine in 2002 and 2003. According to a report in Advertising Age, ABC auditors uncovered as many as 200,000 free subscriptions in each of the two years that Ziff Davis improperly classified as paid circulation under ABC rules.
"ABC's board of directors felt that now was the perfect time to send a message that circulation fraud will not be tolerated, and they have chosen to enact the censure provisions," Dittmar says, adding that circulation fraud is extremely uncommon, and, as a whole, the industry is honest and self-regulating.
But Robert Sacks, a 34-year veteran of printing and publishing, and publisher of a daily industry e-newsletter, says publications pump up circulation rates more frequently than ABC contends, and that the situation gets more troubling the more one looks into it.
"I see falsifying circulation rates as a huge problem, with most people having their head firmly in the ground," he says. "The problem will just go away when we have marginalized our industry into impotence. And that is happening now."
Sacks says the new rules ABC has implemented won't change the business practices of the publishing industry, and suggests publishers implement a zero-tolerance policy.
But an industry analyst, who wished to remain anonymous, says that most magazines are not risking their reputations and relationships with advertisers. A very small percentage of consumer magazines have had reporting errors in their circulation numbers, the analyst says.
Michael Lavery, president and managing director of ABC, admits the system is not foolproof.
"No audit program can immediately identify every possible fraudulent situation. If a publication sets out with deliberate intent to misrepresent its figures, it is difficult to catch them initially."
- Warren Chiara