The U.S. Postal Service has changed the criterion that determines when a paid magazine's circulation counts as paid, bringing USPS more in line to the standards for publications of the Audit Bureau of Circulations and BPA Worldwide.
Previously, a paid magazine had to charge at least 50% of its stated subscription price to be considered paid by USPS. Now, a magazine needs to charge 30% of that price, which is nearer to both ABC's and BPA's rules requiring each title charge to at least 50% of its subscribers 25% of its basic subscription price to be counted as paid.
"For the savviest circulation director, this means they can give three years-for-the-price-of-one deals to their subscribers," said Eddie Mayhew, president of Eddie Mayhew Classification Statements.
Since paid magazines generally don't do much price experimentation, the ruling shouldn't have a huge effect. "Having 17 different price points and special industry-expert rates and so on just isn't how you get most b-to-b subscribers," said David Straus, managing partner at the Washington, D.C., offices of Thompson Coburn.
"For those of us that have some paid books, it's a finger in the dike," said Barry Green, VP-director of circulation at Hearst Business Media. "It's [like] building a little bit of a levee." He also said, however, that the ruling doesn't totally end the discrepancy between postal audits and circulation audits; all magazines sold below the 30%-price line are considered to be complimentary issues by the Postal Service.
The lower price point should help circulators add more consumers to their subscriber lists. "Subscriptions will just keep getting lower and lower," Mayhew said. "I'm sure they'll eventually go lower than 70%."
USPS changed its standards following discussions at several meetings of the Periodical Advisory Group, a group of Postal Service and publisher representatives who meet quarterly. PAG then needed to take the proposal to the Postal Rate Commission, the ruling body on all things postal, which generally only contacts publishers when dealing with a rate case. PAG previously has been responsible for such considerations as the ride-along rate, which allows secondary items to be polybagged and mailed simultaneously at a discounted price, and the liberalization of blow-in card restrictions, which allows publications to include blow-in cards from other publications.
Straus said he thought that the best thing to come out of the meetings was the manner in which the approval-process was handled by the PAG.
"The Postal Service people on PAG have frequently resisted proposals because they would require the approval of the Postal Rate Commission. They would suggest that the proposal might have to wait until the Postal Service filed a rate case," he said. "I'm hoping this experience might, in the future, lead the Postal Service to conclude that simply because something has to go to the [Postal] Rate Commission, doesn't mean it has to be an enormous burden on [both the USPS and PRC], and that changes that are desirable can be made."
Mayhew said he agrees. "It shows that the Postal Service is willing to work through issues," he said. "It wouldn't have even gone through the PRC if that wasn't specifically the way things are stated in the Domestic Mail Classification Schedule [the statute that makes the rules for the Postal Service.]
"That was a formality," Mayhew continued. "The change would've happened a long time ago, but just needed the rubber stamp."
He said that this negotiation marked a time of true cooperation between the USPS and publishers, and hopes it's a sign of things to come.
"This should help us all realize that good things can get done without [them] being a huge deal," Mayhew said.