The U.S. Postal Service on October 12 proposed new rates for 2017 that may significantly decrease postage costs for many newspapers using the nation’s postal system to deliver Total Market Coverage (TMC) products (e.g. ad inserts to non-subscribers). As a result of the change, some major market metros could see a reduction in postage costs by hundreds of thousands of dollars next year, particularly if the TMC package is heavier in weight.
Why the decrease? The Postal Service is simplifying the rate structure by removing Flats Sequencing System pricing for Marketing Mail (formerly Standard Mail) and increasing the “piece pound breakpoint” for Saturation, High Density Plus, and High Density flats from 3.3 to 4.0 ounces. Because of this increase in the piece pound breakpoint, newspapers could see a rate decrease of up to 11 percent for TMC packages. Important note: The rate changes will depend upon the volume and weight of mailings, and where the mail is entered into the system. We encourage newspapers to calculate the potential rate decrease (or increase for lighter packages) when planning for budget purposes.
The News Media Alliance met with Postal Service management more than a year ago to discuss ways it could encourage newspapers to keep their TMC products in the mail versus independent carrier delivery. Postal Service management suggested increasing the piece pound breakpoint as a way of incentivizing newspapers to grow the size of the mailed piece on the theory that a heavier piece with more advertising inserts will offset mailing costs and create a financially healthier package that is more likely to stay in the postal system. With this increase in the piece pound, the Alliance believes the Postal Service is sending a strong message that it wants newspapers’ TMC business.
The USPS proposal also brought good news for weekly newspapers that mail their editorial product. Rates in 2017 for periodicals within-county will largely remain flat, except for periodicals that use the 5-Digit Automation flats rate, which rises 3.67 percent. The new prices, if approved by the Postal Regulatory Commission, will also include a two cent increase in the price of a First-Class Mail Forever stamp.
The new rates will go into effect on January 22, 2017.
This chart describes the rate changes for rate categories typically used by our member newspapers.
Please direct questions about postal rates to News Media Alliance Senior VP, Public Policy, Paul Boyle: 571-366-1150 / email@example.com.
Paul Boyle is the Senior Vice President of Public Policy at News Media Alliance.