Time, People Cut Rate Base
Getting rid of unprofitable subscriptions.
Time and People are cutting their respective rate bases in 2015.
Time's circulation guarantee will go down about 7.7 percent (250,000 copies) to 3 million, while People's will be reduced just under 1.5 percent (50,000 copies) to 3.425 million starting Jan. 1, according to AdAge.
A Time spokesperson says the decision was made "to optimize…marketing spend and cut less profitable circulation."
As print advertising dries up, fewer magazines can survive as loss-leaders, so removing unprofitable subscriptions has become a more common strategy. Notably, Time competitor Newsweek relaunched with just 70,000 copies last year—less than one-twentieth of its rate base when it folded in 2012.
Their distribution and economics are different than those of newsweeklies, but Reader's Digest and Parade are two other high-profile titles to lop off significant chunks of guaranteed circulation recently.
Time's circulation had been just over its rate base at 3.29 million through the first half of 2014, according to the Alliance for Audited Media. That's down about 84,000 from when it last cut its rate base, going from 4 million to the current 3.25 million in 2007.