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Comment by tshaddox | Hacker News Reader

Is it not the other way around? I would think that the USPS subsidizes paper spam. I find it very hard to believe that paper spamming would be even remotely economically viable at market cost.

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If you look at the mass mailing options that the USPS markets on their website, they ask you to basically buy a whole delivery route at a time.

There's no routing and sorting they have to do. The carrier just picks up a stack of letters at the start of the shift, and drops one in every mailbox.

The labor cost that the USPS has to put in for a mass mailing is a fraction of what it has to do for normal mailing.

There is another cost - the cost to society of paper garbage and dead trees. I live in a 200+ unit apartment building and recently received a mailer for hedge cutting. I promptly went to the mailroom recycling bin and threw it out, discovering about 150 identical copies thrown out by other unit residents. Obviously no one in a building needs hedge cutting — we live in apartments, not houses — but the mailer didn’t care or put much thought into even basic ad targeting. What a waste.

Why would USPS subsidize spam? What’s the upside to them? They have literally no incentive I can think of to do that.

They subsidize it by charging a rate per piece that is less than a regular stamped mailing, but at a price level that still turns a profit.

It's market segmentation, full price service for those willing to pay it, and a cheaper option for business without enough margins to justify that.

Let me clarify my argument. Ostensibly, the goal of the USPS is to connect all of America with flat-rate first-class mail. The USPS charges as much to send a letter across the country as it does to send it to your apartment neighbor. That means that people in cities (or really, people in routes with high density first-class mail usage) subsidize people in lower-density areas. Let’s assume that we agree that this goal is reasonable, and thus that this subsidy of low-density customers by high-density customers is reasonable.

This means that mass-mailers are being subsidized by the USPS’ implementation of this goal of nationwide first-class mail, because presumably they are paying less than the actual cost of mailing their advertisements. I suppose we could go a step further, and say that high-density customers are in fact subsidizing mass-mailers, which I think most people would agree is not a reasonable subsidy.

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