In a long-awaited ruling by the Postal Rate Commission last Friday, the PRC said it would not recommend alterations to the Periodicals rate structure as requested in the complaint filed by Time Warner, Conde Nast, Newsweek, Readers Digest and TV Guide in January 2004.
Time Warner, et al., had requested that bundles, sacks and pallets be considered to be fundamental components of the rate structure, along with pieces, pounds, distance and presort, arguing that these characteristics are cost drivers that must be considered in rates. In addition, the complainants argued that the current unzoned editorial pound rate should be zoned, as is the case now for the advertising pound rate.
This complaint pitted the largest consumer publishers against the smaller b-to-b publications, many of which do not have enough volume to move from sacks to pallets or to create large sacks and bundles.
The PRC has ruled that the existing rate structure does not violate existing postal policies and law, as the complainants had claimed, and, in particular, found that the unzoned pound rate for editorial content “fosters the public policies” of the Postal Reorganization Act.
Witnesses for American Business Media and McGraw-Hill, which opposed the complaint, testified before the Commission that if the reorganization of the rate structure proposed by Time Warner and the others was implemented, it would have a substantially adverse impact on small publications.
Although recommending no specific changes, the Postal Rate Commission did encourage the Postal Service to work with Periodical mailers to improve the design of Periodicals rates.
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