Washington Post 2007 Annual Report Download - page 30

Download and view the complete annual report

Please find page 30 of the 2007 Washington Post annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 106

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106

station WDIV included indecent material. The Company responded to each of the notices by letter to the FCC denying
that the programs identified in the complaints were indecent, and these matters remain pending. In addition, the
Company was notified on January 25, 2008 that the FCC had proposed a monetary forfeiture against station KSAT,
alongwith51othertelevisionstations,inconnectionwiththe station’s broadcast of an allegedly indecent scene in an
episode of the drama “NYPD Blue.”
Sponsorship Identification Issues. During 2006 and 2007, a media watchdog group filed a series of complaints at
the FCC alleging that various broadcast stations and cable channels violated the FCC’s sponsorship identification rules
by broadcasting material provided to them by a third party without disclosing the source of the material. The FCC
issued Letters of Inquiry to three Company-owned stations that had been named in the complaints. Specifically,
Company-owned station WJXT was named in the first complaint, along with 76 other broadcast stations, and
Company-owned stations WKMG and WPLG were named in the second complaint, along with 44 other stations.
During September 2007, the FCC released two decisions proposing monetary forfeitures against a cable operator in
connection with a series of news broadcasts identified in the complaints. These decisions do not directly impact the
Company, but they are relevant because the FCC typically uses similar standards to evaluate alleged sponsorship
identification violations by broadcast stations and cable operators. Nonetheless, no forfeitures have been proposed
against broadcast stations in connection with this matter, and because the Company-owned stations identified in these
complaints did not receive any consideration in exchange for the material that they broadcast, the Company does not
believe that the actions of those stations violated FCC rules or federal law. However, while the FCC’s investigations
concerning the three Company stations remain pending, it is not possible to predict what further actions (if any) the FCC
maytakeinresponsetothecomplaints.
The FCC is conducting proceedings dealing with various issues in addition to those described elsewhere in this section,
including proposals to modify its regulations relating to the ownership and operation of cable television systems (which
regulations are discussed in the section titled “Cable Television Operations”).
Depending on the respective outcomes, the various rule changes, FCC proceedings and other matters described in this
section could adversely affect the profitability of the Company’s television broadcasting operations.
Magazine Publishing
Newsweek
Newsweek is a weekly news magazine published both domestically and internationally by Newsweek, Inc., another
subsidiary of the Company. In gathering, reporting and writing news and other material for publication, Newsweek
maintains news bureaus in 8 U.S. and 11 foreign cities.
The domestic edition of Newsweek includes more than 100 different geographic or demographic editions that carry
substantially identical news and feature material, but enable advertisers to direct messages to specific market areas or
demographic groups. Domestically, Newsweek ranks second in circulation among the three leading weekly news
magazines (Newsweek, Time and U.S. News & World Report). For each of the past five years, Newsweek’s average
weekly domestic circulation rate base has been 3,100,000 copies, and its percentage of the total weekly domestic
circulationratebaseofthethreeleadingweeklynewsmagazines, which had been 34.0%, increased in 2007 to
37.1% because Time Magazine had implemented a rate base reduction earlier in 2007. Effective with the January 14,
2008 issue, Newsweek, Inc. lowered the magazine’s average weekly domestic rate base to 2,600,000 copies. As a
result, Newsweek’s percentage of the total weekly domestic circulation rate base of the three leading weekly news
magazines will be 33.1%.
Newsweek is sold on newsstands and through subscription mail order sales derived from a number of sources,
principally direct mail promotion. The basic one-year subscription price is $41.08. Most subscriptions are sold at a
discount from the basic price. Newsweek’s newsstand cover price was increased to $4.50 from $3.95 effective with
the May 8, 2006 issue and then was increased to $4.95 effective with the December 18, 2006 issue; $4.95 remains
the current cover price.
Newsweek’s published advertising rates are based on its average weekly circulation rate base and are competitive
with those of the other weekly news magazines. As is common in the magazine industry, advertising typically is sold at
varying discounts from Newsweek’s published rates. Effective with the January 8, 2007 issue, Newsweek’s published
national advertising rates for all categories of such advertising were increased by an average of approximately 5.0%.
Beginning with the issue dated January 14, 2008, Newsweek’s published national advertising rates were lowered
14 THE WASHINGTON POST COMPANY