The U.S. Postal Service Jan. 11 announced plans to seek rate increases that, while raising first class by only a penny, or 3%, would hike rates for magazines by 15%, newspapers by 9% and standard commercial mail by an average of 7%. The increases would take effect next year and now go to the Postal Rate Commission. The proposal drew immediate condemnation from the Magazine Publishers of America, Newspaper Association of America and Direct Marketing Association. The postal service said the periodical rate increase reflected "significant growth" in delivery costs, but magazine publishers that had been working with the postal service on ways to jointly cut costs said they felt blind-sided. The MPA said the proposal would charge magazines doing the most to bar-code and presort the biggest increases. Newspaper Association of America CEO John Sturm called the newspaper boost "a very steep price to pay" and also complained because the postal service was proposing decreasing rates for those sending heavier quantities of advertising mail. "It seems curious," he said. At the DMA, Senior VP-Government Affairs Jerry Cerasale noted members of his group account for more than $5 billion in standard commercial mail a year, and stated: "We think the increases are inappropriate at this time. Why are they bumping up rates in the business segment when the USPS is trying to grow mail volume with the new Internet companies and traditional mediums?"
Copyright January 2000, Crain Communications Inc.