Postal commission approves discount for junk-mail ads
Many of the nation's newspapers opposed the Valassis plan, which gives a rate cut to their biggest competitor.
WASHINGTON — The government body that oversees the U.S. Postal Service has approved a plan that gives one of the nation's largest direct marketers a postage discount on advertising fliers known as "junk mail."
The three-year deal approved by the Postal Regulatory Commission on Thursday is intended to boost use of the mail system by Valassis Communications, which sends mass coupon mailings to homes under its RedPlum ad bundles.
The commission said the plan should add $4.7 million to $15.3 million in net benefit to Postal Service coffers over the course of the deal.
Many of the nation's newspapers — including The Seattle Times — opposed the plan, which gives a rate cut to their biggest competitor. The Newspaper Association of America (NAA) said that for a meager benefit, about $1 billion in annual newspaper-industry ad revenue would be put at risk because it would lure big advertisers away from Sunday newspapers. The NAA said it would appeal the decision.
U.S. Sen. Maria Cantwell, D-Wash., who wrote a letter in June to the commission opposing the proposed agreement with Valassis, vowed Thursday to try to block the decision.
"This decision does nothing to solve the Postal Service's problems and does great harm to the newspaper industry," she said. "When Congress returns in September, we will try to stop it."
The commission dismissed the newspapers' damage estimate, saying that "newspapers' claims of harm, while no doubt earnest, do not lend themselves to reasonable quantification."
Livonia, Mich.-based Valassis applauded the decision, calling it a "validation of this innovative proposal."
Use of the Postal Service is declining as more people turn to email, Facebook and Twitter. At the same time, print-newspaper subscriptions and advertising have been falling due to a shift of readers to online-news outlets.