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Panpa Bulletin : April 2006
NeWS the cover price of week- day issues of Australia's top-selling daily, News Limited's Herald Sun, has been raised by ten cents to $1.10. It is the first increase for more than six years, when the imposition of the GST pushed the price up to $1. The cost of the Saturday issue has been left at $1.40. The Herald Sun's broadsheet rival, The Age, retails on week- days for $1.20 and $2.00 on Sat- urday. Industry watchers believe that the Melbourne move may be the first in a series of cover price rises in the offing by a range of other daily publica- tions. In mid-February, The West Australian put up the price of its bulky Saturday edition by 20 cents to $2.20. The latest budgets drawn up by newspaper managements have been adversely affected by a hefty rise of about $66 a tonne that will apply to news- print supplied by Norske Skog from July 1. Paper is the second highest cost after labour for the major publishers. Most budgets prepared to cover the new financial year have adopted a cautious line on advertising prospects, forcing managers to review their pre- ferred strategy of maintaining circulations by keeping cover prices stable. The newsprint increase, de- tails of which are given more fully in our story about Norske Skog's top management chang- es on Page 33 in the production section of this issue of the PAN- PA Bulletin, follows significant hikes that have already kicked in the cost of consumables and ink. Publishers have also had to cope with hefty increase in dis- tribution costs. With a Monday-to-Friday circulation of 554,000 copies (514,000 on Saturdays), the 10 cent increase in the cover price of the Herald Sun will bring in bring in additional annual rev- enue of more than $12 million. Advertising yields 70 per cent of the Herald Sun's income. 25 per cent of this increase will be absorbed in commis- sions paid to Victoria's 1200 newsagents and 5500 sub- agents. Newsagents have been critical of the stable cover pric- es because, while handling and distributing larger issues, they have not enjoyed any increases to their income. Newspaper sales usually suf- fer marginally for a short period after a price increase but, with good marketing support, circu- lation is usually coaxed back to or near to pre-increase levels. News Limited's $340 million Westgate print plant at Port Melbourne consumes 75,000 tonnes of newsprint annually, using 520 tonnes of black and 121 tonnes of coloured inks. The hike in newsprint prices from July 1 will add $5 million to Westgate's overhead costs. herald Sun cover price to rise It’s the second price rise by a major daily this year. Jack Beverley looks at the herald Sun decision and ponders whether it’s the beginning of a trend. Newspaper sales usually suffer marginally for a short period after a price increase but, with good marketing support, circulation is usually coaxed back to or near to pre-increase levels.