[Federal Register Volume 77, Number 204 (Monday, October 22, 2012)]
[Notices]
[Pages 64566-64567]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-25841]


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POSTAL REGULATORY COMMISSION

[Docket No. MT2013-1; Order No. 1502]


Market Test of Experimental Product--Metro Post

AGENCY: Postal Regulatory Commission.

ACTION: Notice.

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SUMMARY: The Commission is noticing a recently-filed Postal Service 
proposal to conduct a market test involving the product called Metro 
Post. This document describes the proposed test, addresses procedural 
aspects of the filing, and invites public comment.

DATES: Comments are due: October 29, 2012.

ADDRESSES: Submit comments electronically via the Commission's Filing 
Online system at http://www.prc.gov. Those who cannot submit comments 
electronically should contact the person identified in the FOR FURTHER 
INFORMATION CONTACT section by telephone for advice on filing 
alternatives.

FOR FURTHER INFORMATION CONTACT: Stephen L. Sharfman, General Counsel, 
202-789-6820.

Table of Contents

I. Introduction
II. Background
III. Notice of Filing
IV. Ordering Paragraphs


SUPPLEMENTARY INFORMATION: 

I. Introduction

    On October 12, 2012, the Postal Service filed a notice, pursuant to 
39 U.S.C. 3641, announcing its intent to conduct a market test of an 
experimental product called Metro

[[Page 64567]]

Post.\1\ Metro Post is a package delivery service that will provide 
customers with same-day delivery from participating locations within a 
defined metropolitan area. Id. at 1. The market test will begin on or 
shortly after November 12, 2012 and continue for one calendar year. Id. 
at 6.
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    \1\ Notice of the United States Postal Service of Market Test of 
Experimental Product--Metro Post--and Notice of Filing Material 
Under Seal, October 12, 2012 (Notice).
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II. Background

    The Postal Service states that online e-commerce companies and 
retailers have realized the power of online shipping platforms, which 
has created an opportunity for the Postal Service to explore the 
feasibility of providing same-day local delivery within a defined 
metropolitan area. Id. at 2. It asserts that the market test is 
specifically designed for online e-commerce companies and associated 
retailers to deliver products in a unique and timely manner to buyers 
living within a specified metropolitan area. Id. at 1. It notes that 
the market test will help the Postal Service test the operational 
feasibility of same-day package delivery and determine the optimal 
pricing structure for this type of service. Id. at 1-2.
    Nature and scope of market test. Pursuant to section 3641(c)(1)(B), 
the Postal Service provides a description of the nature and scope of 
the market test. As part of the market test, the Postal Service will 
enter into relationships with qualifying online e-commerce companies to 
offer same-day local delivery. Id. at 2. Each participating online e-
commerce company must have at least 10 physical locations nationally 
and one or more locations within the defined metropolitan area of the 
market test. The Postal Service anticipates entering into relationships 
with up to 10 companies over the course of the market test. Id.
    The initial period of the market test lasts until January 2013. Id. 
at 2. During the initial period, each participant may only receive 
same-day delivery for up to 10 participating locations within a defined 
metropolitan area. Id. Only 200 packages per day may receive same-day 
delivery from the Postal Service during the initial period. Id. at 2-3. 
Eligible buyers must live in a specified area within a selected major 
metropolitan area. Id. at 3. The daily cut-off times for making 
purchases delivered via Metro Post will occur between 2:00 p.m. and 
3:00 p.m. Same-day delivery will occur between approximately 4:00 p.m. 
and 8:00 p.m., as determined by the Postal Service. Id.
    Statutory authority. The Postal Service indicates that its proposal 
satisfies the criteria of 39 U.S.C. 3641, which imposes certain 
conditions on experimental products. The Postal Service asserts that 
Metro Post is significantly different from all products offered within 
the past 2 years because it has not offered a same-day local delivery 
product during that time. Id. at 5; see 39 U.S.C. 3641(b)(1). It states 
that it does not expect Metro Post to create an ``unfair or otherwise 
inappropriate competitive advantage for the Postal Service or any 
mailer'' because prices offered by competitors for same-day delivery 
typically fall within the price range that the Postal Service intends 
to test. Notice at 5-6; see 39 U.S.C. 3641(b)(2). The Postal Service 
filed its pricing plans for the Metro Post market test under seal. 
Notice at 4. The Postal Service classifies Metro Post as a competitive 
product because it asserts that same-day delivery of packages is a 
component of the competitive package services market. Id. at 6; see 39 
U.S.C. 3641(b)(3).
    Exemption from revenue limitation. The Postal Service expects that 
the total revenue received from the market test may exceed the $10 
million revenue limitation for market tests. Notice at 7; see 39 U.S.C. 
3641(e)(1). It applies for an exemption of this statutory requirement 
and states that it has taken steps to ensure that anticipated revenues 
will not exceed $50 million in any year. Notice at 7; see 39 U.S.C. 
3642(e)(2). It asserts that the market test is likely to benefit the 
public and meet an expected demand, as well as contribute to the 
financial stability of the Postal Service. Notice at 7.
    Data collection. The Postal Service asserts that it will monitor 
market demand for Metro Post and will track the costs of providing 
same-day local delivery. Id. at 8. It has prepared a data collection 
plan and is prepared to report on the results of its research to the 
Commission. Id.

III. Notice of Filing

    The Commission establishes Docket No. MT2013-1 to consider matters 
raised by the Notice, including the Postal Service's request for 
exemption from the $10 million revenue limitation. It encourages 
interested persons to review the Notice for more details. Interested 
persons may submit comments on whether the Postal Service's filing in 
the captioned docket is consistent with the policies of 39 U.S.C. 3641. 
Comments are due no later than October 29, 2012. The filing can be 
accessed via the Commission's Web site (http://www.prc.gov).
    The Commission appoints Tracy Ferguson to serve as Public 
Representative in this docket.

IV. Ordering Paragraphs

    It is ordered:
    1. The Commission establishes Docket No. MT2013-1 to consider 
matters raised by the Notice.
    2. Pursuant to 39 U.S.C. 505, Tracy Ferguson is appointed to serve 
as an officer of the Commission (Public Representative) to represent 
the interests of the general public in this proceeding.
    3. Comments by interested persons are due no later than October 29, 
2012.
    4. The Secretary shall arrange for publication of this order in the 
Federal Register.

    By the Commission.
Shoshana M. Grove,
Secretary.
[FR Doc. 2012-25841 Filed 10-19-12; 8:45 am]
BILLING CODE 7710-FW-P