Update: MPA Launches $10 Million Offensive Against USPS’ Rate Case

The Magazine Publishers of America is about to begin a $10 million campaign to fight the 15 percent magazine rate increase the U.S. Postal Service filed with the Postal Rate Commission last month. The campaign also will aggressively pursue a complete reform of the postal system.

While full details of the three-year campaign haven’t been announced, the MPA – which represents more than 240 domestic publishing companies in the consumer magazine business – said it will ask other book and newspaper publishers and like-minded organizations as well as publishing partners and vendors that stand to be affected by the rate increase to join in.

“The postal service’s message to the magazine industry is clear. We and our readers are being told that we have to pay the price for the postal service’s inherent inefficiencies and out-of-control cost structure,” said MPA president Nina B. Link. “It is intolerable.”

The MPA will address the failings of the postal system and the need for a fundamental restructuring. Rita Cohen, vice president of economic and legislative analysis at the MPA, said the campaign has three components:

• It will litigate against the rate proposal and work with the PRC during its discovery phase, where it is asking the USPS why it proposed the numbers it did. The MPA will present an alternative case to the PRC in May.

• It will evaluate the future of the USPS and explore other delivery options of magazines by private companies in a timely, inexpensive manner.

• It will find professional lobbying and public relations firms to help with a marketing campaign to raise public awareness of the rates being proposed and how they will affect Americans. In addition, the MPA is set to begin an advertising campaign within the pages of its member magazines that would reach nine out of 10 consumers.

The MPA is not the first association to express dismay with the USPS’ proposed rates. Last month, the Direct Marketing Association’s board of directors passed a resolution of “no confidence” in the USPS. DMers are concerned because the proposal calls for an average increase of 7.7 percent for Standard-A Mail rates.

“We haven’t really gotten together on this, but I don’t see any reason for us not to work closely together in our efforts to straighten this mess out,” said Jerry Cerasale, senior vice president of government affairs at the DMA.

While both groups are lobbying for postal reform, H.R. 22 – the Postal Modernization Act of 1999 – is currently stalled in Congress. This legislation would give the USPS more freedom to set some of its rates while spinning off many of its competitive products and services into a private corporation.

“We want the American people and their elected representatives to know what’s at stake here – not just for their magazines, but for the future of the postal system itself,” said Christopher M. Little, president at Meredith Corp. Publishing Group, Des Moines, IA, and vice chairman of the MPA’s board of directors.

Little, who also heads the MPA’s government affairs council, said many publishers will renew their efforts to look for alternative ways to deliver their magazines “because we’ve been through that before.” When postal rates went above inflation in the 1980s and early ’90s, many tested alternative delivery services in large cities and had magazines delivered by the same dedicated carrier services used by newspaper operators. However, the publishers switched back to the USPS when postal prices moderated.

The rate proposal also will push publishers more than ever to conduct their circulation and transactions on the Internet, he said.

“Meredith alone mails hundreds of millions of pieces of mail a year to subscribers and potential subscribers,” said Little. “We are mailing solicitations, bills and renewals, for example, and these functions are heavily impacted by these proposed rates, too.”

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