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USPS gains approval for controversial Valassis deal

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Washington, D.C.—The U.S. Postal Service won approval Thursday for its plan, heavily criticized by the newspaper industry, to give commercial mailing company Valassis Communications a steep postage discount in return for increased mail volume. With approval from the Postal Regulatory Commission, the USPS will give Valassis postage discounts of up to 34% provided it sends 1 million additional pieces of commercial mail over the next 12 months. Livonia, Mich.-Valassis mailed more than 3 billion pieces last year on behalf of advertisers. The PRC estimated that increased volume from Valassis would net the USPS up to $15.3 million over three years. However, the Newspaper Association of America announced it was “stunned” by the deal, charging that it would take business away from its members' Sunday ad supplement programs. The Postal Service should not use postage rates “to confer a significant and unwarranted advantage on one competitor at the expense of an entire industry,” said Caroline H. Little, NAA president-CEO, in a statement.
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