Eighty million to be distributed
Distribution costs Swiss Post and publishers developed a new model for press promotion: it remains roughly the same price.
Distribution costs Swiss Post and publishers developed a new model for press promotion: it remains roughly the same price.
Parliament's decision to no longer subsidize press distribution by post from 2008 hangs like the sword of Damocles over the publishing guild. This is true in two respects: without the current CHF 80 million annual reduction in postal tax, small publishers in particular see their existence threatened. In addition, the already fragile unity between large and small publishers in the Swiss Press Association (VSP) is at stake: Swiss Post has set the wedge: it has made it clear that without federal subsidies it would have to introduce two different prices, a kind of urban and a rural tariff. The reason: delivery in sparsely populated areas is significantly more expensive than in densely populated areas. In addition, Swiss Post is forced to charge lower, competitive rates in urban agglomerations anyway due to the newspaper contract organizations of the major publishers.
Motion as a glimmer of hope
For some time now, publishers have therefore been desperately trying to avert the impending danger (see box). Thanks to a motion that was referred to the Federal Council this spring, they now see a glimmer of light on the political horizon again. The motion instructs the national government to once again draft a law for "targeted participation in distribution costs", explicitly addressing "the shortcomings of the system in force until the end of 2007". The current system is accused of being based on a watering can principle, which is why high-circulation member newspapers from Coop, Migros or TCS also benefit from postal tax subsidies.
In order to drive the political process forward, a joint working group of the Swiss Press Association (VSP) and Swiss Post has now drafted a new press subsidy model and presented it to publishing circles. According to Hanspeter Kellermüller, VSP lawyer and member of the working group, the model envisages a two-stage subsidy - a basic subsidy for all existing press titles and an additional subsidy only for small-circulation press titles.
The basic subsidy consists of a standardized nationwide tariff for postal delivery, which is based on the distribution costs in urban agglomerations. The additional costs for press distribution in rural areas, on the other hand, would be borne by the federal government. Large press titles such as the customer magazines of Coop or Migros are also included in this part of the federal compensation. "Politicians are occasionally calling for these large titles to be excluded. However, we consider their volume to be important, as they make a contribution to coverage that should not be underestimated, especially in rural areas, and small titles also benefit from this. Excluding them would be counterproductive," says Kellermüller.
The second stage, the additional subsidy, provides for a supplementary reduction in postal rates for weekly and daily newspapers with circulations of between 1,000 and 40,000 copies that also have to meet other criteria. "The entire model thus meets the regional and press policy requirements of the motion and would allow targeted distribution support on the basis of the current federal contributions," says Kellermüller.
Swiss Post does not wish to comment on the material. "It is true that we are striving for a new model with the publishers, but we are only at the stage of exchanging ideas," says Swiss Post spokesman Richard Pfister. Moreover, there is time until 2008.
However, this sounds rather hypocritical. Because with this model, Swiss Post is torpedoing the Alternative Delivery Organization (AZO) for magazines, which the major publishers Ringier, Tamedia, NZZ, Südostschweiz and the retail giant Valora want to set up as of 1 January 2006. However, AZO can only succeed if major customers such as Coop, Migros and TCS are won over. So far this has not been the case, and the new model of Swiss Post and VSP makes the situation even more difficult for AZO. This is because the major distributors and TCS are hoping to be included in the press promotion scheme again in the end. This is having an effect: their interest in AZO has already waned noticeably.
Unity of the VSP at riskIt is probably no coincidence that the VSP of all organizations is helping Swiss Post to stab the AZO planned by VSP members in the back: This is because AZO provides for a volume-based rate, which puts publishers of small magazines at a disadvantage. This could jeopardize the unity of the VSP just as much as a city/country tariff from Swiss Post.
AZO spokesman Walter Lütolf also acknowledges that Swiss Post can now operate more diversely thanks to the new press promotion model. He also confirms that the model could become a stumbling block for AZO. "If Swiss Post can reduce the price of its distribution with federal funds, it will be tight for the competition." However, he points out that AZO could start as early as next year, while the political discussion on the new proposal has not even started yet. "We are sticking with AZO because we are convinced that an alternative can be successful in the long term," says Lütolf.
Politically activeThe publishers were not prepared to accept the fact that press funding was to be removed from federal responsibilities. They proposed other forms of state support for the press. In 2003, for example, the Swiss Press Association (VSP) proposed a foundation endowed with CHF 150 million, the funds of which would be earmarked for newspaper distribution and training. Recently, the VSP has kept the idea in the background due to the lack of support in the political debate.
A second idea put forward by small publishers and left-wing circles envisaged a media article in the Federal Constitution that would replace press subsidies via reduced postal taxes with direct subsidies for press products. Such an article was rejected by Parliament. Instead, it passed the motion that once again called for a federal contribution to press distribution. (mk)
A bone of contention: Who should benefit from delivery fees from federal funds remains controversial.
Markus Knöpfli
Parliament's decision to no longer subsidize press distribution by post from 2008 hangs like the sword of Damocles over the publishing guild. This is true in two respects: without the current CHF 80 million annual reduction in postal tax, small publishers in particular see their existence threatened. In addition, the already fragile unity between large and small publishers in the Swiss Press Association (VSP) is at stake: Swiss Post has set the wedge: it has made it clear that without federal subsidies it would have to introduce two different prices, a kind of urban and a rural tariff. The reason: delivery in sparsely populated areas is significantly more expensive than in densely populated areas. In addition, Swiss Post is forced to charge lower, competitive rates in urban agglomerations anyway due to the newspaper contract organizations of the major publishers.
Motion as a glimmer of hope
For some time now, publishers have therefore been desperately trying to avert the impending danger (see box). Thanks to a motion that was referred to the Federal Council this spring, they now see a glimmer of light on the political horizon again. The motion instructs the national government to once again draft a law for "targeted participation in distribution costs", explicitly addressing "the shortcomings of the system in force until the end of 2007". The current system is accused of being based on a watering can principle, which is why high-circulation member newspapers from Coop, Migros or TCS also benefit from postal tax subsidies.
In order to drive the political process forward, a joint working group of the Swiss Press Association (VSP) and Swiss Post has now drafted a new press subsidy model and presented it to publishing circles. According to Hanspeter Kellermüller, VSP lawyer and member of the working group, the model envisages a two-stage subsidy - a basic subsidy for all existing press titles and an additional subsidy only for small-circulation press titles.
The basic subsidy consists of a standardized nationwide tariff for postal delivery, which is based on the distribution costs in urban agglomerations. The additional costs for press distribution in rural areas, on the other hand, would be borne by the federal government. Large press titles such as the customer magazines of Coop or Migros are also included in this part of the federal compensation. "Politicians are occasionally calling for these large titles to be excluded. However, we consider their volume to be important, as they make a contribution to coverage that should not be underestimated, especially in rural areas, and small titles also benefit from this. Excluding them would be counterproductive," says Kellermüller.
The second stage, the additional subsidy, provides for a supplementary reduction in postal rates for weekly and daily newspapers with circulations of between 1,000 and 40,000 copies that also have to meet other criteria. "The entire model thus meets the regional and press policy requirements of the motion and would allow targeted distribution support on the basis of the current federal contributions," says Kellermüller.
Swiss Post does not wish to comment on the material. "It is true that we are striving for a new model with the publishers, but we are only at the stage of exchanging ideas," says Swiss Post spokesman Richard Pfister. Moreover, there is time until 2008.
However, this sounds rather hypocritical. Because with this model, Swiss Post is torpedoing the Alternative Delivery Organization (AZO) for magazines, which the major publishers Ringier, Tamedia, NZZ, Südostschweiz and the retail giant Valora want to set up as of 1 January 2006. However, AZO can only succeed if major customers such as Coop, Migros and TCS are won over. So far this has not been the case, and the new model of Swiss Post and VSP makes the situation even more difficult for AZO. This is because the major distributors and TCS are hoping to be included in the press promotion scheme again in the end. This is having an effect: their interest in AZO has already waned noticeably.
Unity of the VSP at riskIt is probably no coincidence that the VSP of all organizations is helping Swiss Post to stab the AZO planned by VSP members in the back: This is because AZO provides for a volume-based rate, which puts publishers of small magazines at a disadvantage. This could jeopardize the unity of the VSP just as much as a city/country tariff from Swiss Post.
AZO spokesman Walter Lütolf also acknowledges that Swiss Post can now operate more diversely thanks to the new press promotion model. He also confirms that the model could become a stumbling block for AZO. "If Swiss Post can reduce the price of its distribution with federal funds, it will be tight for the competition." However, he points out that AZO could start as early as next year, while the political discussion on the new proposal has not even started yet. "We are sticking with AZO because we are convinced that an alternative can be successful in the long term," says Lütolf.
Politically activeThe publishers were not prepared to accept the fact that press funding was to be removed from federal responsibilities. They proposed other forms of state support for the press. In 2003, for example, the Swiss Press Association (VSP) proposed a foundation endowed with CHF 150 million, the funds of which would be earmarked for newspaper distribution and training. Recently, the VSP has kept the idea in the background due to the lack of support in the political debate.
A second idea put forward by small publishers and left-wing circles envisaged a media article in the Federal Constitution that would replace press subsidies via reduced postal taxes with direct subsidies for press products. Such an article was rejected by Parliament. Instead, it passed the motion that once again called for a federal contribution to press distribution. (mk)
A bone of contention: Who should benefit from delivery fees from federal funds remains controversial.
Markus Knöpfli
