The New York Times reports that the Securities and Exchange Commission has contacted half a dozen media companies and asked about their circulation practices.
The companies include Gannett, Knight Ridder, and McClatchy as well as Dow Jones, The Washington Post Company and the New York Times Company.
A source said the inquiries are a “fact-finding effort on behalf of investors” who look at circulation as a measure of a newspaper’s health.
Two practices mentioned in the story are throwing free papers and counting them as paid – uncovered at Newsday by its own reporters – and giving away trips and cash to outside contractors – the delivery people – for not returning unsold papers.