Dallas Paper Appeases Advertisers with $23m Payout

18 August 2004

The latest US newspaper to admit overstating circulation figures has agreed to quiet disgruntled advertisers with over $23 million (€18.6m; £12.5m) worth of cash, credits and free ad space.

The Dallas Morning News, owned by media giant Belo, follows Hollinger International's Chicago Sun-Times and the Tribune Company's Hoy and Newsday newspapers in enhancing sales claims [WAMN: 09-Aug-04].

The cash payment of 10% of total Sunday adspend between August 1 2003 and July 31 2004 will be mailed to advertisers within the next twelve working days. Sunday figures are being used in calculations as the Sunday circulation overstatement, at 5%, was greater than for dailies.

On top of the $23m cash compensation, Belo will spend $3m on an internal investigation into the circulation claims, as well as incurring $4m in extra printing costs for advertising credits.

Advertisers will be provided with a 'credit bank' containing the value of 5% of their total ad purchases during the year ending July 31 2004. This will then be accessible for future ad purchases.

An additional cash payment will also be made to preprint-advertisers for excess printing costs.

Describing the payout as 'manageable', chairman/ceo Robert Dechard adds: "We view it as an investment in the entire company's future … the trust of our advertisers is a pillar of the economic value Belo has built."

Data sourced from: The Wall Street Journal Online; additional content by WARC staff