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Schumer letter to PRC on Valassis NSA

Schumer letter to PRC on Valassis NSA

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Published by: bsheehan on May 23, 2012
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05/24/2012

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CHARLES
E.
SCHUMER
NeW
YORK
Shoshana GroveSecretary
ilnited
~tates
~mote
WASHINGTON,
DC
20510
May 22, 2012United States Postal Regulatory Commission
901
New York Avenue, NWSuite 200Washington, DC 20268
Cm,\l,1lnEES
BANKINGDEMOCRATiC POLICY
&
COMMUNICATIONS
FINANCE
JUDICIARY
RULES
Re: Proposed Postal Service Negotiated Service Agreement
with
ValassisDocl{et Nos. MC2012-14
&
R2012-8Dear
Ms.
Grove:I write
to
express my strong concerns regarding the
US
Postal Service's NegotiatedService Agreement (NSA) with Valassis. I have been presented with recent research conducted
by
the Newspaper Association
of
America which indicates that this proposed NSA violatesunderlying law and would result in a serious financial harm
to
local daily newspapers across thecountry.
My
comments are pursuant
to
77
Fed Reg.
27,491 (Order No. 1330), noticed on May
10,
2012, regarding
"Notice
of
the United States Postal Service
of
Filing
of
Contract and SupportingData and Request To Add Valassis Direct Mail, Inc. Negotiated Service Agreement To TheMarket-Dominant Product List, Docket No. MC2012-14
&
Docket No. R2012-8 (filed April 30,2012)." The NSA proposed under this notice should be rejected as it fails to comply with federalstatute as described below.
1.
This proposal violates 39
U.S.c.
§3622(c)(lO)(B) which ensures
that
such "specialdeals"
cannot
be
approved
if
they cause
"unreasonable
harm"
in themarketplace. Although in proposing the NSA
to
the Postal Regulatory Commission,the Postal Service asselied that the rate deal will have a "minimal financial impact in themarketplace" it is clear that any research which might have been conducted to draw thisconclusion was insufficient. The Valassis deal in question provides a reduced rate for themailing
of
paper adveliising from retailers
of
"durable and semi-durable"goods. According to the Newspaper Association
of
America, more than 70%
of
newspapers' advertising inserts come from such retailers.This proposal would allow Val ass
is to
compete for the same business newspapers providethrough their total market coverage programs at a subsidized rate. The NewspaperAssociation
of
America contends that this could cause the loss
of
$1
B in annual revenuesfor the newspaper industry nationwide.
®
ttp://schurner.sennte·fl
OV
Postal Regulatory CommissionSubmitted 5/22/2012 2:04:04 PMFiling ID: 82590Accepted 5/22/2012

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