PRC FINDS PERIODICALS CURRENT RATE STRUCTURE LAWFUL
Commission ruling favors ABM members
NEW YORK, October 21, 2005--In the long-awaited decision on the complaint filed by Time Warner, Condé Nast, Newsweek, Readers Digest and TV Guide, the Postal Rate Commission today ruled that the existing Periodicals rate structure “is not violative of the policies of the Postal Reorganization Act.” American Business Media and the McGraw-Hill companies opposed the complaint filed in January 2004. The PRC also ruled that the unzoned pound rate for editorial content - which American Business Media has long supported and the complainants attacked - “fosters the public policies” of the Postal Reorganization Act. As a result, the Rate Commission declined to issue a recommended decision altering the rate structure, thus denying any action the complainants requested.
The Postal Rate Commission also found, based upon the testimony and exhibits offered by American Business Media and McGraw-Hill, as well as information provided by the Postal Service, that the implementation of the complainants’ recommendation “would have a substantially adverse impact on small publications,” although it expressed the view that some movement in the direction of a “more cost-based structure” to increase efficiencies is appropriate.
The Commission urged the Postal Service study the Periodicals rate design in the context of the current and planned processing and transportation network, to develop a less costly container than sacks as preferable to imposing rate penalties on “captive users” of sacks and to confer with a broad cross-section of Periodicals mailers to consider the desirability of implementing what it called an “opt-in approach” to Periodicals rates. Under that approach, publications with circulations above a specified threshold would be required to use a rate schedule reflecting many of the changes proposed by the complainants, such as container-based rates and a zoned editorial pound rate, while those with smaller circulations would be free to choose between that schedule and the present schedule.
Gordon Hughes, president and CEO of American Business Media, said that the association is “quite pleased with the decision and gratified that the Postal Rate Commission continues to safeguard the interests of smaller-circulation periodicals.” Hughes added, “American Business Media expected that the Commission would recommend further study of ways to improve Periodicals rates and is prepared to participate actively in any such studies.”
Steve Ennen, Director of Communications
American Business Media
T 212.661.6360 x3331