MEDIA: Spotlight - No one-size-fits-all formula for compact ad rates.

The newspapers are hitting opposition from agencies over ad rates.

'It's our equivalent of Contract Rights Renewal,' one press director said last week when faced with trading proposals from Times Newspapers and The Independent.

The launch of compact editions of The Times and The Independent has involved discussions, at times heated, between media owners and agencies on the formulae that should be put in place to cover charges for advertising running in titles.

Things came to a head last week when The Independent, ahead of last Saturday's launch of its Independent on Saturday compact, toured agencies with proposals that it would increase prices by 12.5 per cent on the back of its compact launch. Just as controversially, it is suggesting a formula that will involve advertisers paying 70 per cent of the rate of a full page in the broadsheet for a full page in the compact.

Times Newspapers is also visiting agencies with a formula. As 20 per cent of its total sale stems from the compact edition, it is proposing a 5 per cent cut in rates across the board to offer some discount because compact pages are smaller. However, agencies seem perturbed on two points.

First, that the level of this discount isn't high enough and second that the three-month deal proposed by The Times isn't flexible enough. Some argue that The Times' formula should allow them at least 11 per cent discount (based on the number of column inches lost in compact ads) but The Times feels able to counter that 5 per cent is fair due to the supposed greater impact of a full page in a compact.

Even some press buyers are willing to concede this. One says: 'There's no research out there that proves a broadsheet is more effective than a tabloid. It's arguably better to have a tabloid page because people tend to fold a broadsheet.'