Real In Business

  • Subscribe to our RSS feed.
  • Twitter
  • StumbleUpon
  • Reddit
  • Facebook
  • Digg

Sunday, 3 June 2012

Why Does the Postal Service Cling to a Money-Losing Monopoly?

Posted on 04:56 by Unknown
The U.S. Postal Service and American publishers are locked in a lose-lose relationship. Maybe they should consider a divorce.

For every dollar it spends on delivering newspapers and magazines, USPS claims it only receives 75 cents in postage. Meanwhile, notes the Columbia Journalism Review (in Postage due: The USPS is running out of money. Where does that leave magazines?), magazine publishers are growing worried about the increase in customer complaints regarding lost, damaged, and late issue. They fear coming changes will only make matters worse.

New interest in bypassing the Postal Service by using private delivery services was much in evidence at a recent magazine-industry summit, CJR reports.

But publishers also pointed out a major barrier to private delivery: Their subscribers want “to get their magazines in their mailboxes, rather than tossed at the end of the driveway like a newspaper. By law, only the USPS can put mail in mailboxes.”

Maybe the Postal Service would be better off loosening its grip on the mailbox monopoly by granting an exception for periodicals. (After all, whoever heard of a money-losing monopoly?) Not only would the agency lose unprofitable customers, it could actually charge the publishers a fee for each mailbox they use.

Allowing delivery only to paying subscribers and restricting the use of loose inserts could prevent the mailbox privilege from siphoning off profitable postal business.

A tougher problem to control would be cherry picking – publishers using private delivery only for densely populated neighborhoods that are easy to serve, leaving the high-cost areas to the Postal Service.

Then there’s the question of what “cost” means in Postalspeak. If the Postal Service says it costs 35 cents to deliver a particular magazine, how much will it save if it doesn’t have to handle that magazine?

Probably much less than 35 cents. A lot of that 35 cents is an allocated portion of expenses that exist regardless of whether the magazine is delivered.

But permanently losing a sizeable chunk of the labor-intensive Periodicals Class business might be enough to move the cost needle. That's especially true as USPS downsizes and shifts toward a flexible workforce, which should make its costs more sensitive to mail volumes.

What's clear is that the current arrangement is not working for the Postal Service or for many publishers.

Related articles:
  • Thrown Overboard: Publishers Feel Abandoned by the U.S. Postal Service 
  • Postal Study Is Bad News For Publishers 
  • Special Mail Processing of 'Hot' Publications To End Friday

Email ThisBlogThis!Share to XShare to Facebook
Posted in magazine industry, Periodicals | No comments
Newer Post Older Post Home

0 comments:

Post a Comment

Subscribe to: Post Comments (Atom)

Popular Posts

  • Confusion, Misinformation Could Hinder USPS's Early-Retirement Push
    Confusion reigns among the 115,000 postal workers who received notices in the past few days about a buyout offer. The confusion could limit ...
  • Are E-Book Sales Reaching a Plateau?
    When the U.S. magazine industry gets hot and bothered about the latest craze, you can usually bet that trend is about to run out of steam. E...
  • Abitibi's New Name: A Portent of Things To Come?
    After considering hundreds of possible monikers, newsprint giant AbitibiBowater has chosen the name of a ship that was trapped in the Canadi...
  • An Affair Between a Printing Lobbyist and Rep. Boehner? Six Reasons Not to Believe It
    The claim that a printing-industry lobbyist is having an affair with GOP Congressional leader John Boehner – and that the New York Times is...
  • The Recycled Debate: Can We 'Get Beyond the Stereotypical Industry-Environmental Relationship'?
    My recent article about discussions between National Geographic and an environmental group has stirred up a debate about recycled paper be...
  • Are Competitors Putting the Squeeze on New Page and White Birch?
    When it comes to setting prices, North American paper companies have exhibited some strange behavior lately that is helping customers but ma...
  • Donahoe, No Potter Clone, Quickly Making His Mark
    With a radical management reorganization , including the break-up of the Intelligent Mail group, new Postmaster General Pat Donahoe showed o...
  • Bad Customer Service Is Built into the Design of U.S. Post Offices, Report Says
    Have you ever stood in a long, slow-moving line at a post office and wondered why only one employee was helping customers? The problem is th...
  • Courier Express and Postal Observer Lives Again
    After announcing last week it would shut down and going offline for a few days, respected postal blog Courier Express and Postal Observer ...
  • Flats Litigation System: USPS and Vendor Battling It Out Over Huge FSS Machines
    A multimillion-dollar dispute between the U.S. Postal Service and the long-time vendor that built its troubled Flats Sequencing System has l...

Categories

  • AbitibiBowater
  • African American postal workers
  • Amazon
  • American Bankers Association
  • American Postal Workers Union
  • Angry Birds
  • antidumping
  • Apple
  • APWU
  • Area Mail Processing studies
  • Audit Bureau of Circulation (ABC)
  • automation refugees
  • Baldwin Technology Company
  • Barnes and Noble
  • Better Homes and Gardens
  • Bisphenol-A (BPA)
  • Bite me
  • black liquor
  • book industry
  • bookazines
  • Borders
  • boreal forest
  • BoSacks
  • Boston Print Buyers
  • Buckeye Technologies
  • BusinessWeek
  • Candace the Caribou
  • Catalyst Paper
  • Cathie Black
  • Champion Paper
  • Chicago Sun-Times
  • Chicago Tribune
  • co-mailing
  • coated groundwood
  • coated paper
  • coldset printing
  • color printing
  • Conde Nast
  • Congress
  • Consumer Price Index
  • Consumer Reports
  • content marketing
  • Cosmopolitan
  • CPI
  • D. Eadward Tree
  • Da Vinci Code
  • Darrell Issa
  • Dead Tree Edition
  • Deputy Postmaster General Ron Stroman
  • Digital IQ
  • direct mail
  • Discover Financial Services
  • Domtar
  • dropshipping
  • E Ink
  • e-books
  • ecologomania
  • electric vehicles
  • Elle Decor
  • Entertainment Weekly
  • Facebook
  • FedEx
  • First Class postage
  • Flats Sequencing System
  • Folio:
  • Forbes
  • ForestEthics
  • forests
  • Forever Stamps
  • freesheet paper
  • George Will
  • Georgia Pacific
  • Glatfelter
  • Google
  • Gordon Pritchard
  • Green America
  • green printing
  • Greenpeace
  • greenwashing
  • Greeting Card Association
  • Guitar World
  • Hearst
  • heatset printing
  • Idealliance
  • in Touch Weekly
  • Indonesia
  • Inspector General
  • Intelligent Mail Barcode
  • International Paper
  • iPad
  • Joint Committee on Taxation
  • KapStone
  • Kentucky Fried Forest
  • Kimberly-Clark
  • Kindle
  • Koch Industries
  • L.L. Bean
  • Leo Raymond
  • letter carriers
  • Life magazine
  • logging
  • magazine industry
  • Magazine Publishers of America
  • mail transport equipment
  • Mailers Technical Advisory Committee (MTAC)
  • Margie Dana
  • MeadWestvaco
  • Men's Journal
  • Meredith
  • MPA
  • Muscle and Fitness
  • National Association of Letter Carriers
  • National Geographic
  • NewPage
  • newspaper printing
  • newspapers
  • newsstand
  • Newsweek
  • Nook
  • Northrop Grumman
  • Office of Personnel Management
  • OK magazine
  • Packaging Corporation of America
  • paper prices
  • part-timers
  • Patti LaBelle
  • People magazine
  • Periodicals
  • Periodicals postage
  • phased retirement
  • Pitney Bowes
  • Port Hawkesbury
  • post office consolidation
  • postage rates
  • postal clerks
  • postal lottery
  • postal pensions
  • postal rates
  • Postal Regulatory Commission
  • postal salaries
  • Postmaster General Jack Potter
  • Postmaster General Pat Donahoe
  • Print Buyers International
  • print media
  • print prices
  • printing employment
  • Printing Industries of America
  • printing prices
  • Printing's Best Blogs
  • Publishing Executive
  • QR codes
  • Quad/Graphics
  • QuadGraphics
  • Quebecor World
  • R.R. Donnelley
  • Readers Digest Association
  • recycled paper
  • Rep. Dennis Ross
  • Rep. Peter DeFazio
  • Resolute Forest Products
  • retiree health benefits
  • Reuters
  • Richard Nixon
  • RISI
  • Robert W. Mitchell
  • Rock-Tenn
  • Rodale
  • Rolling Stone
  • Rosie magazine
  • Ruth Goldway
  • Samir Husni
  • Sammy Smartphone
  • San Francisco Chronicle
  • SAPPI
  • Saturday delivery
  • search engine optimization
  • Second Ounce Free
  • Sen. Max Baucus
  • Sen. Thomas Carper
  • Sonoco Products
  • Standard postage
  • Star magazine
  • Stern Partners
  • StoraEnso
  • subscriptions
  • supercalendered paper
  • sustainable forestry
  • tablets
  • Temple-Inland
  • The Atlantic Monthly
  • The Wall Street Journal
  • Thurgood Marshall Jr.
  • timber industry
  • Time Inc.
  • Time magazine
  • Toshiba
  • Traditional Home
  • Transcontinental Inc.
  • Twitter
  • Two Sides
  • U.S. News and World Report
  • U.S. Postal Service
  • United Parcel Service
  • UPM
  • USPS bankruptcy
  • USPS employment levels
  • USPS network optimization
  • USPS privatization
  • VERA
  • Verle Sutton
  • Verso
  • Veterans Job Corps
  • Viagra
  • Voluntary Early Retirement (VERA)
  • Washington Post
  • West Linn
  • West Virginia
  • Weyerhaeuser
  • White Birch Paper
  • William Burrus
  • Worldcolor

Blog Archive

  • ►  2014 (2)
    • ►  January (2)
  • ►  2013 (57)
    • ►  December (4)
    • ►  November (4)
    • ►  October (8)
    • ►  September (7)
    • ►  August (3)
    • ►  July (4)
    • ►  June (3)
    • ►  May (4)
    • ►  April (4)
    • ►  March (4)
    • ►  February (6)
    • ►  January (6)
  • ▼  2012 (90)
    • ►  December (4)
    • ►  November (8)
    • ►  October (7)
    • ►  September (11)
    • ►  August (6)
    • ►  July (7)
    • ▼  June (7)
      • Mr. Tree Gets the Axe
      • 9 Lessons From Toshiba's No-Print Day Debacle
      • Greenpeace Sticks It To Toshiba: Company Has No Pa...
      • Hurry It Up, Key Senator Tells Postal Regulatory C...
      • Toshiba's No-Print Day As Popular As a Turd in the...
      • 10 Questions About Toshiba's No-Print Day
      • Why Does the Postal Service Cling to a Money-Losin...
    • ►  May (6)
    • ►  April (8)
    • ►  March (8)
    • ►  February (6)
    • ►  January (12)
  • ►  2011 (111)
    • ►  December (5)
    • ►  November (8)
    • ►  October (13)
    • ►  September (9)
    • ►  August (9)
    • ►  July (8)
    • ►  June (12)
    • ►  May (6)
    • ►  April (9)
    • ►  March (10)
    • ►  February (11)
    • ►  January (11)
  • ►  2010 (40)
    • ►  December (6)
    • ►  November (14)
    • ►  October (14)
    • ►  September (6)
Powered by Blogger.

About Me

Unknown
View my complete profile