Transfer Guidelines

Ensuring transferred circulation counts as paid.

 

If you have or plan to purchase a list, or are transferring a file from one publication ceasing issuance onto another and plan on counting the circulation as paid for AAM reporting, the following requirements should be followed to ensure the circulation transferred will qualify as paid circulation.

Transfer rules are addressed in the AAM bylaws and rules under F 9.4/F 109.4 Transfers on Consolidation, F 9.5/F 109.5 Purchase of Subscription List, F 9.6/F 109.6 Transfers from One Going Publication to Another and  F 9.7/F 109.7 Transfers from Suspended Publications to Others.  

Each of these rules address specific situations wherein a publisher may wish to service the remaining liability of a publication with a substitute title(s). This set of guidelines addresses the most common situation presented to AAM staff, wherein one publication has ceased issuance and the remaining service owed to subscribers on file is being absorbed by a replacement publication (or selection of publications).  Situations other than this should be referenced directly to the appropriate rule for that specific condition as noted in the preceding paragraph.  

 

1. Notification to AAM

It is important to advise AAM of an impending transfer at the earliest stage and, if possible, even before purchasing the list. This notification should include a completed Transfer Notification and Request Form.  

 

2. Requirement for publications to be homogeneous

Per AAM rules, when a publication is transferring its remaining subscriber liability to a replacement publication, the replacement publication must be considered homogeneous in content or the subscriber must be given the opportunity to receive a cash refund for their remaining service owed. When the publisher is offering a cash refund to the subscribers of the publication ceasing issuance, there is no requirement that the publications involved be homogenous in content. 

If a homogenous ruling is requested, the following will be considered in making this evaluation:

A.  Both criteria are met:

  1. 40 percent or more editorial content is similar
  2. 40 percent or more advertisers are the same

OR

B.   A total of eight points through an evaluation of the below items:

Possible Points Evaluation Criteria
8 Editorial content similar
8 Like advertisements/like advertisers
4 Same regional focus
4 Similar demographic profile of subscriber base
4 Similar positioning of magazine in market via media packets
2 Similar circulation selling/sources of like audiences (i.e., same/similar mail list)
1 Direct mail materials used containing appeal to similar audiences

To make this ruling, AAM will need to be provided the following materials from the publisher making the request:

  • Copy of publication ceasing issuance
  • Copy of publication serving as replacement title
  • Rate card of publication ceasing issuance
  • Rate card of publication serving as replacement title
     

3. Consumer notification

There is likely to be subscriber notification of the change in publications as a result of one publication ceasing issuance. In the event that the replacement publication is not homogeneous with the publication that ceased issuance, this notification is required, as a cash refund must be offered as an option to the consumer. 

AAM will request that the publication provide this notification to ensure no conflicts are found in the manner the notification is being made or the contents of this notification with AAM rules.

 

4. Validation of subscriber file being transferred

The publication ceasing issuance may or may not be currently AAM audited. In situations where the publication is not a current client with a current audit, an order test needs to be completed to ensure the subscribers meet the minimum AAM requirements. This does not need to be done prior to the actual transfer occurring, but must be completed prior to the audit of the receiving publication being completed. 

In situations when the publication ceasing issuance is a current client of AAM, the subscriber file for that publication will need to be validated through the last file update to validate all copy liability is being transferred. 

It is therefore important for the publication receiving subscribers from a publication ceasing issuance to ensure that records are maintained and subscriber documentation is retained to support order and payment for all names on file. This is necessary for both direct to publisher orders as well as third-party generated subscriptions, whether or not the publication was audited by AAM at the time orders were generated. 

The publication receiving the subscribers from the publication ceasing issuance should confirm this information would be readily available when requested in audit and provide information to AAM in their request for review of transfer as to where this information will be made available and the responsible contact person.

Fees associated with the validation of the publication ceasing issuance will be billed by AAM at the current auditing rate.

 

5. AAM access to complete promotional file

For publications not currently audited by AAM, a promotion file for at least the last year of the discontinued publication should be made available to the auditor for their review during the validation of the subscription file.  

 

6. File transfer ratio

AAM rules speak to the transfer of remaining liability in offering one of two options. 

A. Based on Publisher’s Suggested Prices:

Determine a per-copy price by dividing the publisher’s annual suggested price by the number of issues in a year for both the discontinued and surviving publications. Then divide the per-copy price of the discontinued publication by the per-copy price of the surviving publication.

Example:

Magazine A merges with Magazine B

Annual publisher’s suggested rates:
A = 12 issues @ $12 ($1.00 per copy)
B = 12 issues @ $18 ($1.50 per copy)

Unexpired Term of A Value of Unexpired Term of A (Unexpired term
x $1.00)
Per-Copy @ Publisher’s Suggested Price of B A Subscribers Receive These Issues of B
4 issues $4.00 $1.50 2.7* or 3 issues
6 issues $6.00 $1.50 4 issues
12 issues $12.00 $1.50 8 issues
14 issues $14.00 $1.50 9.3* or 10 issues
18 issues $18.00 $1.50 12 issues

 *Fraction may be rounded up once total eligible issues to be received has been calculated.

B. Copy-for-Copy Formula

The substituted magazine will serve the same number of copies as are due the unexpired subscriptions of the discounted magazine. This may be done only when the per-copy publisher’s suggested price of discontinued publication is at least 50 percent of the per-copy publisher’s suggested price (based on the publisher’s annual suggested price) of the surviving magazine.

The request for review of transfer plans will need to identify the manner that the remaining liability will be transferred.

 

7. Start of service

Service of the newly substituted magazine must begin within six months to subscribers of the discontinued magazine for circulation to be counted as paid per current rules. As an example, if the last issue of a publication with a monthly frequency is October, the first issue mailed of the surviving publication must be no later than the April issue. If the last issue is labeled Fall, the first issue served of the surviving publication must be within six months of the mail date of the Fall issue.

For AAM review of your plans of transfer, it will be necessary that the publication receiving the subscriber liability notify AAM as to the last issue served of the publication ceasing and the issue that subscribers will begin new service

 

8. Maintaining of transfer file detail

Once a publication processes the transfer of subscriber liability, the following files and information summaries of both the publication that has ceased issuance as well as the publication(s) receiving the subscriber liability must be maintained.

These files and information summaries can be maintained in either print or electronic format.  It is important that the publication receiving the transferred names be able to obtain these saved files at the request of AAM.  

Information that will need to be made available to the auditor includes the following:

  • Listing of all subscribers (in some instances AAM may assign states)
  • Geographic analysis report
  • Copy liability report
  • Subscription order test from the ceased publication to test subscriber qualification
  • Provide AAM with total number of gross subscriptions on transferring file. AAM will then select an Nth sample to test back to source documentation.
  • For the selected subscribers, AAM will need to review the order and payment that brings the subscriber to the expiration date on the galley.

AAM should be provided a copy of the entire transferring galley (either electronic or hard copy) which includes at least subscriber name, address, amount paid, start date, expire date and source (i.e., agency, direct).

A complete galley (either electronic or hard copy) of the first issue(s) that includes the transferred subscribers should be maintained for further testing. This additional testing may include, but is not limited to:

  • Duplication testing to insure the same subscriber/address is not receiving more copies than ordered, paid for and wanted.
  • Other testing as determined necessary to insure the proper qualification/categorization of the circulation including the transferred file.
     

A few final points regarding a transfer

In addition to the requirements for review and validation of the subscriber liability to be transferred, the following items should be noted for publications as they may impact filing and reporting on AAM reports.

1. Disclosure of the facts surrounding the transfer must be made in the Notes section of the publisher’s statement covering the period when the transfer occurred. This disclosure must include the following information:

  • Name of “From” publication
  • Total number of subscribers transferred
  • How many issues of the current title did the transferred subscriber receive for every paid issues remaining with the ceased publication
  • First issue served by receiving publication
  • Average circulation served in the publisher’s statement period as a result of transferred subscribers
  • Note: When a publication transfers subscriptions categorized as sponsored sales, partnerships and other paid subscription categories, the subscribers will be transferred from those specific categories to the same respective categories.

Publisher statement disclosure phrasing:

_______ ceased publication.  _____ of its subscribers received ______ issue(s) of this publication for every paid issue remaining of their _____ subscription, starting with the _____ issue.  Included in Paid Subscriptions is the following average: _____

2. When a publication accepts subscribers from another publication, the activity generated as a result of the transfer should be excluded from the average price calculation (Paragraph 2) and from production (sales) data reported in Paragraph 8 of the publisher’s statement

3. Subscriptions from transfers served post-expiration copies are not eligible for inclusion in paid circulation on the publisher’s statement of the receiving publication.

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