The main industry group for Canadian print and digital media blasted Canada Post Thursday for what it called unfair competition in the flyer delivery business.
News Media Canada, which the Star is a member of, says Canada Post shouldn’t be using its exclusive access to condo and apartment mailboxes to deliver flyers. Newspapers have traditionally been the main delivery vehicle for flyers that advertise products for local businesses, and the practice is a major revenue source for many media outlets.
“We don’t think that most Canadians would support using federal dollars to compete against local private business. However, if Canada Post is involved in the flyer business, it needs to be on a level playing field. Canada Post is undercutting local newspapers by using its exclusive access to lock boxes,” said News Media Canada CEO John Hinds.
In a statement responding to the industry group’s claims, Canada Post denied it’s competing unfairly, and argued it needs flyer revenue as part of its official mandate to be financially self-sufficient.
“While Canada Post has exclusive access to mailboxes, we don’t deliver everything Canadians receive at their door. Newspaper distributors and other delivery operators often gain permits to access apartments from landlords and apartment building managers,” the statement said, adding that private companies, including newspapers, account for the majority of flyer delivery.
Hinds also contended it makes little sense for the federal government to allow Canada Post to unfairly take potential revenue away from newspapers, at the same time the media industry is struggling, thanks to increasing competition for advertising dollars.
“At a time when our industry is knee-deep in transition, this deliberate undercutting of one of newspapers’ foundational revenue pillars by a federal Crown Corporation is very troubling,” Hinds said.
The Liberal government has promised almost $600 million in tax credits and incentives for some media organizations over the next five years.
Outlets that meet certain qualifications will receive a 25 per cent tax credit on salaries for some newsroom employees, while media organizations will also be able to apply for charity-like status.
“We believe this is a good time to reinforce the fact that local advertising supports local news creation and that flyers are a key component of the business. Canada Post isn’t creating jobs and news in communities,” Hinds said.
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