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Tuesday, February 22, 2005

Postal Rates 

Lower Postal Hikes Expected

The postal service looks like it will offer a lower price increase to periodical publishers--for now. We should be grateful--the kind of gratitude we feel when someone stops flogging us. (And note the cute 34 cent stamp to the left. Ah, the good old days!)

I completely understand that we have the bestest postal service in the world, and that it's relatively cheap, given its universal service and fairly good delivery record.

But at a time when the underpinnings of what we mean by 'print' are transforming--let's substitute 'written media' for 'print'--increasing our rates isn't going to work. Pure economics will force publishers to continue to seek alternative delivery methods, including electronic--which lowers the total volume of mailed issues, which lowers postal revenues, which then forces another rate increase.

I think the postal service needs to rethink this pattern. They're losing everywhere--to email, FedEx and UPS, and the Internet. They need to cut costs, try new delivery and pricing strategies (should it cost the same to mail a letter from Washington, D.C. to New York as it does from Washington to Nome, Alaska?), and recognize that the volume of direct mail and magazines/catalogs can be increased by lowering prices, not raising them. This volume would translate into higher revenues.

There is a way for the Postal Service to compete, but it's not by jacking up rates.


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