Readers pay extra! extra! fees for papers Lower ad revenue means higher costs for papers' readers.

September 30, 1991|By Jon Morgan | Jon Morgan,Evening Sun Staff

Newspapers across the country, facing a serious slump in advertising revenues, are digging deeper into their readers' pockets to make up the difference.

John Morton, a newspaper analyst with the Wall Street firm of Lynch, Jones and Ryan, says newspapers have become increasingly aggressive with price increases over the past two years as the business faces a severe downturn.

Several major newspapers have recently broken the 50-cent barrier for non-Sunday newsstand prices. While the prevailing norm remains 35 cents, that will probably give way to 50 cents within the next few years, Morton says.

Effective with today's editions, the Baltimore Sun increased the newsstand price of The Evening Sun and The Sun to 50 cents Monday through Saturday, up from 35 cents. Sunday and home delivery prices were not changed.

The papers' newsstand prices increased from 25 cents to 35 cents 11 months ago.

"Things are pretty tough in the newspaper business all over," says Baltimore Sun spokesman David Belz. He says the company has traditionally priced its papers below industry averages and now hopes to enter the "mainstream."

The New York Times today also increased its non-Sunday newsstand price, from 40 cents to 50 cents within the New York area. The price outside the area, including Baltimore, will remain what it has been since 1989: 50 cents.

Earlier this year, the Philadelphia Daily News went from 35 cents to 50 cents. The Philadelphia Inquirer, which shares ownership with the Daily News, has no plans to increase its 35-cent price, a spokesman says.

The Boston Globe last year raised its price to 35 cents within its metro area, and the price outside the region was raised to 50 cents earlier this year. Home delivery prices increased in March.

L "Expenses have gone up," says Globe spokesman Richard Gulla.

The Washington Post, which faces competition at home from the Washington Times, sells for 25 cents within Washington and 35 cents in the Baltimore area. A spokeswoman did not respond to an inquiry about pricing plans.

USA Today has cost 50 cents for several years and there are no immediate plans to change the price, a spokesman says.

Other 50-cent papers include the St. Louis Post-Dispatch, the Kansas City Star, the New York Post and the Milwaukee Journal. Major papers still charging a quarter -- the bargain basement in the industry -- include the Los Angeles Times, the Denver Post and the Atlanta Journal.

Morton says the reasons for the price increases are simple: major advertisers are paring their ad budgets due to the economic downturn, and direct mail and other advertising outlets are taking business away from newspapers. The result is dramatic drop in ad revenue, which typically accounts for about 80 percent of newspaper income.

Newspapers, restrained by competition from increasing ad rates, have responded with higher prices for readers, he says.

The strategy carries the risk of accelerating a nationwide decline in newspaper readership, he says. But experience indicates most readers put off by price increases tend to adjust and resume buying the paper over the long term, he says.

As a compromise, many newspapers keep home delivery prices low and increase newsstand prices.

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