Post puts together package against the AZO
Distribution The alternative delivery organization of the major publishers has been quiet for four months. Now, however, a maneuver by Swiss Post is forcing the AZO project makers to come out of their shell.
Distribution The alternative delivery organization of the major publishers has been quiet for four months. Now, however, a maneuver by Swiss Post is forcing the AZO project makers to come out of their shell.
On December 21, 2004, the top management of NZZ, Tamedia, Ringier, Südostschweiz and Valora commissioned a committee to set up their own Alternative Delivery Organization (AZO) for magazines in competition with Swiss Post by 2006. According to the feasibility study, AZO would be able to serve all households in German-speaking Switzerland two days a week - at a rate at least 10 percent below the current postal rates. But the clients also imposed an information freeze. For the last four months, therefore, almost nothing was heard from AZO - until last week: Within a few days, the project was widely discussed in the in-house newspapers of Ringier and St. Galler Tagblatt Medien as well as in the newsletter of the Swiss Press Association (VSP). The background to the action is probably that the AZO Committee wants to show that its project has not fallen asleep. It also continues to demonstrate to the publishers and Swiss Post its determination to implement an alternative. After all, Swiss Post did not remain idle either, but reacted to the AZO order by starting to lure publishers with sweeteners.
So far, it has done this on two levels: On the one hand, it offers tariff reductions, on the other hand, it offers cooperation to publishers with large-circulation newspapers and early delivery organizations. With both measures, it puts them in a sandwich position between AZO and Swiss Post, and also sows discord.
The most recent example: Swiss Post is prepared to reduce its tariff for magazines and newspapers slightly. It is doing this by halving the smallest element of all price components, the so-called tariff surcharge, as of July 1, 2005. It has submitted a corresponding application to the supervisory authority DETEC. This surcharge applies to periodicals whose mailing format is larger than B5, and it currently amounts to 1 to 5 centimes per copy, depending on the weight of the product. For an average daily newspaper, this amounts to a maximum of 8 percent of the total rate, and less for magazines. It is clear that the publishers are nevertheless pleased with this reduction in rates, as it would benefit almost all of their periodicals.
Offers to publishersAt the cooperation level, Swiss Post is apparently offering to transfer the emptying of mailboxes and other services to the early delivery organizations, and is also interested in "borrowing" staff from the early delivery organizations in the event of temporary bottlenecks (body leasing). Discussions to this effect are currently underway.
Both represent an attack on the AZO. Because every time Swiss Post lowers its rates, the AZO offer becomes less attractive. All the more so if Swiss Post also offers publishers additional income. What's more, the same early delivery companies with which Swiss Post recently wants to cooperate had already been asked by the AZO committee to participate in the alternative project and submit an offer.
It is therefore not surprising that AZO once again marked its presence. All the more so as the article in the VSP newsletter gives the impression that the association is using the AZO as leverage for lower postal rates. VSP lawyer Hanspeter Kellermüller wrote there that after the halving of the format surcharge, publishers are expecting "further voluntary rate reductions" because the AZO project has shown "that the costs at Swiss Post are clearly excessive, which also affects newspaper distribution."
Swiss Post, however, is unimpressed. "We are not planning any further rate reductions, and the halving of the format surcharge is not related to AZO, but to the new newspaper logistics introduced in summer 2004," says Swiss Post spokesman Dario Ballanti.
It is astonishing that the VSP is now beginning to instrumentalize the AZO for its own politics, since it had always emphasized - even in the aforementioned newsletter - that the AZO was "a purely private initiative". This fuels the suspicion that the AZO only serves as a means of exerting pressure on the publishers. AZO spokesman Walter Lütolf denies this, but he can understand the impression, especially since Swiss Post CEO Ulrich Gygi was informed in detail by the publishers involved about how AZO calculates and where there is potential for savings.
However, this has not changed the mandate to get AZO up and running. "Indirectly, Swiss Post is admitting with its proposal that costs can be reduced and that this creates a certain scope for price reductions," Lütolf is pleased to say. But he warns against merely threatening the yellow giant without wanting to realize the AZO. "Ultimately, only competition can contribute to development." In any case, he says, the AZO is not endangered by Swiss Post's latest moves. "We have taken such things into account. We also now have many interested logistics providers, so AZO could definitely be built up," he says.
Nevertheless, Lütolf can't say much concrete about the status of the project. Does he have the circulation giants Coop-Zeitung, Migros-Magazin, TCS-Zeitung Touring or Schweizer Illustrierte, which are so important for AZO, on board? "Talks with these titles are progressing well," says Lütolf simply. In fact, Coop spokesman Felix Wehrli says he is "interested in a solution that reduces the high costs of distributing 2.2 million Coop newspapers." But that seems to be all. Marius Hagger, Head of Editorial Offices and Publishing Migros-Medien, has also not yet made any promises, but is "first awaiting an offer from AZO."
This shows exactly the dilemma of the project: As long as no customers commit, AZO cannot give definitive prices to the logistics providers - and vice versa. Lütolf also lets it be known that time is running out. In late summer," he says, "AZO will have to appear before the commissioning committee again, by which time customers and logistics providers must be determined, "otherwise we will stop working," he says. "Or someone other than us will set up the project, possibly without publishers and their early deliverers."
Postal distribution center: How many newspapers will be mailed from here in the future is written in the stars.
Markus Knöpfli
On December 21, 2004, the top management of NZZ, Tamedia, Ringier, Südostschweiz and Valora commissioned a committee to set up their own Alternative Delivery Organization (AZO) for magazines in competition with Swiss Post by 2006. According to the feasibility study, AZO would be able to serve all households in German-speaking Switzerland two days a week - at a rate at least 10 percent below the current postal rates. But the clients also imposed an information freeze. For the last four months, therefore, almost nothing was heard from AZO - until last week: Within a few days, the project was widely discussed in the in-house newspapers of Ringier and St. Galler Tagblatt Medien as well as in the newsletter of the Swiss Press Association (VSP). The background to the action is probably that the AZO Committee wants to show that its project has not fallen asleep. It also continues to demonstrate to the publishers and Swiss Post its determination to implement an alternative. After all, Swiss Post did not remain idle either, but reacted to the AZO order by starting to lure publishers with sweeteners.
So far, it has done this on two levels: On the one hand, it offers tariff reductions, on the other hand, it offers cooperation to publishers with large-circulation newspapers and early delivery organizations. With both measures, it puts them in a sandwich position between AZO and Swiss Post, and also sows discord.
The most recent example: Swiss Post is prepared to reduce its tariff for magazines and newspapers slightly. It is doing this by halving the smallest element of all price components, the so-called tariff surcharge, as of July 1, 2005. It has submitted a corresponding application to the supervisory authority DETEC. This surcharge applies to periodicals whose mailing format is larger than B5, and it currently amounts to 1 to 5 centimes per copy, depending on the weight of the product. For an average daily newspaper, this amounts to a maximum of 8 percent of the total rate, and less for magazines. It is clear that the publishers are nevertheless pleased with this reduction in rates, as it would benefit almost all of their periodicals.
Offers to publishersAt the cooperation level, Swiss Post is apparently offering to transfer the emptying of mailboxes and other services to the early delivery organizations, and is also interested in "borrowing" staff from the early delivery organizations in the event of temporary bottlenecks (body leasing). Discussions to this effect are currently underway.
Both represent an attack on the AZO. Because every time Swiss Post lowers its rates, the AZO offer becomes less attractive. All the more so if Swiss Post also offers publishers additional income. What's more, the same early delivery companies with which Swiss Post recently wants to cooperate had already been asked by the AZO committee to participate in the alternative project and submit an offer.
It is therefore not surprising that AZO once again marked its presence. All the more so as the article in the VSP newsletter gives the impression that the association is using the AZO as leverage for lower postal rates. VSP lawyer Hanspeter Kellermüller wrote there that after the halving of the format surcharge, publishers are expecting "further voluntary rate reductions" because the AZO project has shown "that the costs at Swiss Post are clearly excessive, which also affects newspaper distribution."
Swiss Post, however, is unimpressed. "We are not planning any further rate reductions, and the halving of the format surcharge is not related to AZO, but to the new newspaper logistics introduced in summer 2004," says Swiss Post spokesman Dario Ballanti.
It is astonishing that the VSP is now beginning to instrumentalize the AZO for its own politics, since it had always emphasized - even in the aforementioned newsletter - that the AZO was "a purely private initiative". This fuels the suspicion that the AZO only serves as a means of exerting pressure on the publishers. AZO spokesman Walter Lütolf denies this, but he can understand the impression, especially since Swiss Post CEO Ulrich Gygi was informed in detail by the publishers involved about how AZO calculates and where there is potential for savings.
However, this has not changed the mandate to get AZO up and running. "Indirectly, Swiss Post is admitting with its proposal that costs can be reduced and that this creates a certain scope for price reductions," Lütolf is pleased to say. But he warns against merely threatening the yellow giant without wanting to realize the AZO. "Ultimately, only competition can contribute to development." In any case, he says, the AZO is not endangered by Swiss Post's latest moves. "We have taken such things into account. We also now have many interested logistics providers, so AZO could definitely be built up," he says.
Nevertheless, Lütolf can't say much concrete about the status of the project. Does he have the circulation giants Coop-Zeitung, Migros-Magazin, TCS-Zeitung Touring or Schweizer Illustrierte, which are so important for AZO, on board? "Talks with these titles are progressing well," says Lütolf simply. In fact, Coop spokesman Felix Wehrli says he is "interested in a solution that reduces the high costs of distributing 2.2 million Coop newspapers." But that seems to be all. Marius Hagger, Head of Editorial Offices and Publishing Migros-Medien, has also not yet made any promises, but is "first awaiting an offer from AZO."
This shows exactly the dilemma of the project: As long as no customers commit, AZO cannot give definitive prices to the logistics providers - and vice versa. Lütolf also lets it be known that time is running out. In late summer," he says, "AZO will have to appear before the commissioning committee again, by which time customers and logistics providers must be determined, "otherwise we will stop working," he says. "Or someone other than us will set up the project, possibly without publishers and their early deliverers."
Postal distribution center: How many newspapers will be mailed from here in the future is written in the stars.
Markus Knöpfli
