Live from the DMI Co-op: Cerasale Warns of rate hike in 2004

President Bush is expected to appoint a commission to make a recommendation to reform the U.S. Postal Service.

While no definite plans have been set, “The administration is aware that the president and this administration will have to take care of this,” Jerry Cerasale said yesterday during a keynote luncheon speech at the Direct Media Inc. 2002 Mailer’s Conference & Co-op in White Plains, NY.

Cerasale, who updated attendees on a number of industry issues, also warned mailers to mark their calendars for the next rate increase, expected to take place in January 2004 with a hike of 10% or more. A potential plan for phasing in the rates could mean a 5% increase in 2004 and a 10% increase in 2005.

“We’re not sure we like that kind of approach at all,” Cerasale said.

Moving on to e-mail append services, Cerasale said that there are currently no state or federal laws outlawing appending e-mail addresses to a postal address. He said the DMA’s guidelines permit e-mails only to those people who have given permission or to lists of prospects that have agreed to have their addresses shared as long an opt-out mechanism is provided.

As for the FTC’s proposed plan to develop a national do-not-call list, telemarketers would be restricted from calling customers that appear on the list, abandoned calls would be limited to 3%, and the time would be limited when telemarketers can call a customer from the time of the most recent purchase.

Among the other highlights of Cerasale’s talk were:

*The postal service’s board of governors has postponed a borrowing decision until its September meeting. The need for new funds is less urgent after the recent rate increase.

*Mail volume through accounting period 11 (the USPS’s fiscal year began Sept. 8 and has 13 periods) was 177.9 billion, compared to 171 billion this year. A 6 billion piece loss, with about 4 billion in advertising mail.

*List brokers report that the number of orders are the same but that the size of the lists ordered is much smaller.

*Orders for envelopes are down significantly.

*President Bush has named Jim Miller — a believer that the postal service should be private — to the USPS board of governors.

*The USPS will begin consolidating processing facilities in November.

*Congress is looking to require notice and choice and most likely the option to opt out to consumers receiving e-mail.

*The DMA is putting together a list of wireless numbers to create a suppress file. It is illegal under federal law to use an automated dialer to call a recipient who must pay for the call. That law covers all of North America.

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