With circulation of the Los Angeles Times tumbling in the past two years, executives of the newspaper have argued that what counts is not quantity but quality meaning home delivery, which advertisers covet the most.

But an analysis of newspaper circulation by Prudential Equity Group LLC found that the Times lost more than 100,000 paid home-delivery subscribers between March 2004 and March 2005. The drop in home delivery was 18.1 percent the sharpest decline among the 10 largest U.S. newspapers.

The Times, which now has a daily circulation of just over 900,000, saw circulation increases in categories less sought after by advertisers discounted subscriptions, which jumped 69.8 percent, and hotel copies, which increased 121.1 percent, according to Prudential’s analysis of Audit Bureau of Circulations data.

Times executives have said they are working to pare less-profitable circulation categories such as Newspapers in Education, heavily discounted subscriptions and hotel copies. At the same time, the paper is looking to reverse the decline in home delivery, which accounts for more than half of the paper’s circulation and is more valuable to advertisers since people spend more time with those newspapers.

Times officials declined to comment on the Prudential report, referring questions to its parent company, Tribune Co. A Tribune spokesman, Gary Weitman, also declined to comment. He referred to a report in the trade publication Editor & Publisher, in which Tribune Publishing Vice President Vincent Casanova disputes Prudential’s methodology.

Casanova told E & P; that in compiling circulation-quality data for newspapers, Prudential assigned the same weight to small circulation categories such as employee copies as larger categories such as Newspapers in Education

*This story is from the August 15 edition of the Business Journal.