MPA and ABP at odds on reclassification

Folio: The Magazine for Magazine Management, Oct 1, 1995 by Tim Bogardus

Sides have been taken, swords have been drawn and the battle is in progress as publishers, consultants, analysts, lawyers and the U.S. Postal Service argue the pros and cons of the postal reclassification proposal now under consideration by the Postal Rate Commission (PRC).

The Magazine Publishers of America and the American Business Press submitted opposing written testimony to the PRC on July 27. The MPA supports the proposal; the ABP is against it. And although the MPA would like to avoid characterizing the issue as Big versus Small, that's certainly how it's playing out.

MPA president Don Kummerfeld says that reclassification "makes good business sense" for publishing as a whole. He points to the 55 percent increase in second-class postal rates since the mid- 1980s and warns that the trend may continue unless "costs are driven out of the Postal Service."

"This classification reform proposal is not about large-circulation magazines versus small-circulation magazines," Kummerfeld writes in his "President's Hotline" newsletter to members. "It's about change, specifically the need to change the way we mail so rising postal costs will not continue to drive up postal rates. It's also about opportunity--a rare chance to actually reduce postal costs."

The MPA contends that co-mailing--or combining several titles at the printer for distribution--will accommodate those publications that would not be able to qualify for the new Publications Service subclass. (To qualify, a magazine must presort at least 90 percent of its mailing list to a three-digit Zip Code, with a minimum of 24 copies to each Zip. Magazines that qualify for the new Publications Service subclass would reap rate discounts of up to 14 percent.) Printers such as R.R. Donnelley and Quad/Graphics, both of which testified on the MPA's behalf (along with Rodale Press and Meredith Corp.), say they are implementing new procedures and equipment to improve co-mailing capabilities.

Small titles voice big concerns

But many industry experts say co-mailing is not feasible for a lot of magazines, especially those printed at short-run printers that specialize in small-circulation titles. (See "Publishers weigh co-mailing options," June 15, 1995, page 31.

In its testimony, the ABP argues that most of its members--primarily small-circulation, business-to-business magazines with national distributions--would be excluded from the new Publications Service subclass. Those titles unable to meet the 24-piece requirement would face a 17 percent rate increase. (The witnesses for ABP included Cahners Publishing, Advanstar Communications, IDG and Stamats Communications.

Gordon Hughes, ABP's president, also charges that reclassification runs contrary to the mandate of second-class mail, which is to provide universal service and facilitate dissemination of "educational, cultural, scientific and informational" material, according to the 1970 Postal Reorganization Act. "We believe this proposed subclass strikes at the diversification in publishing," he says.

Instead of reclassification, the ABP proposes that the existing mail structure be amended to incorporate into the current second-class subclass a set of requirements based on mandatory barcoding, automation, computerization and changes in palletization practices. "We are not obstructionist in this in any sense, as we have been depicted," remarks ABP counsel David Straus. "A company should do everything it can to be efficient."

Harry Tunis, director of publications for the National Council of Teachers of Mathematics, and former president of the Society of National Association Publications (SNAP), also recommends an amendment to existing regulations.

"I do not think it is necessary to divide second-class in two in order to encourage automation barcoding or presortation, which is available today to both smaller- and larger-circulation periodicals in current regular and nonprofit subclasses," Tunis says in SNAP testimony submitted alongside the ABP's.

In her testimony submitted on behalf of the MPA, Mary Ellen Zuckerman, co-author of The Magazine in America and a business school professor at the State University of