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NAA files motion to stop Valassis sweetheart deal; requests newspaper assistance - California Newspaper Publishers Association : Legislative And Legal

NAA files motion to stop Valassis sweetheart deal; requests newspaper assistance

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Posted: Monday, September 10, 2012 10:40 am

Last week the Newspaper Association of America (NAA) filed an appeal with the U.S. Court of Appeals for the District of Columbia Circuit challenging the Postal regulatory Commission's plan that gives Valassis a huge postage discount on its Red Plum ad bundles and threatens newspaper insert advertising nationwide.

NAA also filed an emergency motion for a stay of the decision until an appeal can be heard. A decision on this stay request could come by the middle of September.

The three-year deal approved by the Postal Regulatory Commission hands Valassis a 22 percent to 36 percent discount on "new" advertising mail pieces which would apply to qualifying mail that includes inserts from national retailers of durable and semi durable goods. These ad inserts are currently delivered through newspapers' free-standing insert programs.

Valassis has already started to use this pricing advantage to sell against newspapers in local markets. This has the real potential of moving advertising inserts from newspapers and driving away a critical source of revenue that supports the distribution of news and information in local communities.   

Several Congressional leaders have expressed serious concern about the PRC's decision because of the strong likelihood that the deal would cause harm to newspapers' ability to serve their communities. These leaders need your help to build support in Congress for overturning the Commission's decision.   

Request for assistance

Please contact your senators and representatives and ask them to support legislative efforts to stop this sweetheart deal before it causes significant financial harm to local newspapers. Also, please ask that senators and representatives express their support for legislative action with the congressional leadership. The newspaper industry is asking Congress to fix the problem of providing special treatment to one national direct mailer for the purpose of taking business away from newspapers. 

Below are discussion points that you can weave into an e-mail or phone conversation with your senators and representatives.

Discussion points

  • The Postal Regulatory Commission - an independent regulatory body - recently approved a U.S. Postal Service proposal that would give one mailer - Valassis Direct Mail - discounts of 22 percent to 36 percent to go specifically after preprinted advertising inserts that are currently in newspapers' Sunday editions.
  • While negotiated service agreements are allowed under current law, Congress made it clear that these types of deals should not cause unreasonable harm in the marketplace.
  • In terms of your newspaper talk about the real impact that the loss of advertising will have on your newsroom and the ability of your newspaper to cover important events in the community.
  • Discuss the impact of the loss of this advertising on the number jobs that will likely be lost at your newspaper.

Congress needs to act quickly to stop this sweetheart deal before it causes significant financial harm to local newspapers. We ask that you encourage your colleagues, including those in the House and Senate leadership, to take legislative action to stop this unfair and inappropriate rate deal before it causes harm in local communities.