Timing is everything, especially for those who enjoy irony at the expense of public relations. Fast on the heels of the U.S. Postal Service's announcement that it wants to raise rates next year, for instance, is the news that an enterprising mail carrier in Chicago found a way of delivering on the promise of a paperless society--just dump a couple hundred pounds of mail and put a match to it. (By the time the fire department finished putting out the flames, it really was junk mail.)
Still, there's nothing funny about rate increases that will average about 10 percent for all classes of mail. For most of us, this hike translates to three cents more for mailing your mother a birthday card, four cents extra to send you this magazine, seven cents more for your bank to mail out a statement, and an additional $1 for overnight express mail.
The Postal Service is caught between a rock and a postage meter. On one hand, the mail has to go everywhere to everyone--an expensive, yet not necessarily profitable, process. On the other hand, the Post Office has to battle competitors who aren't compelled to provide universal access, but who can target and dine off of highly profitable markets such as business-to-business overnight mail. And to make things worse, innovations in electronic communication are posing new challenges. As Keith Smith, a senior marketing analyst for the Postal Service, recently said, "The old postal monopoly has been rendered obsolete by technology advances."
The impact of technology on the Post Office varies, depending on which business you're looking at and how that technology is applied. Electronic communication has had the greatest impact on the household-to-household segment. (How many times have you phoned your mother instead of dropping her a letter?) The business-to-business segment, however, has been more affected by fax machines. Although no one really knows how many faxes are sent daily, Smith estimates that 43 percent of them replace first-class mail and 33 percent overnight express. (Interestingly, we're in the midst of a nationwide phenomenon whereby the growth in the number of phone lines being installed is outstripping the growth in population. It's a safe bet that fax machines and modems are tied to most of those lines.) In total, the Postal Service guesses that it has lost about $2 billion to fax machines in the last few years.
Not that you can blame consumers. According to Southwestern Bell, it costs just six cents at off-peak rates to send a one-page fax the 30 miles from Dallas to Fort Worth (assuming a one-minute transmission time). Next year, sending that same one-page document by first-class mail will cost 32 cents and take a day or two at best. Granted, a first-class letter doesn't require the up-front costs of fax machines and telephone lines. Nevertheless, the volume of first-class mail continues to climb, contrary to the Office of Technology Assessment's 1988 prediction that e-mail and faxes would cut first-class mail to 40 billion pieces by 1990. Instead, it climbed to more than 92 billion pieces in 1993.
To deal with technological innovations, the Postal Service recently established a Technology Applications group that's charged with examining advanced technologies, developing new products, and performing competitive analysis. It's no surprise that handwriting recognition is high on their priority list. Consider that sorting mail by hand used to cost the Post Office $42 per thousand pieces. Current-generation automated systems have pared this to $19 per thousand. Next-generation systems--based on handwriting recognition and remote bar-coding--will cut this to as little as $3 per thousand pieces.
Looming on the electronic horizon, of course, are computer networks. According to Smith, the Postal Service "is paying a lot of attention to the information superhighway," even though most projects on the drawing board are entertainment services aimed at upper-income consumers--a notion contrary to the Post Office's charter of universal access. In recent hearings before the Senate Governmental Affairs subcommittee, Postmaster General Marvin Runyon reaffirmed this, stating that the Postal Service is "working with other organizations to develop an interactive information kiosk and provide a platform that can be used by other federal agencies." He went on to suggest that "perhaps [post office] lobbies could serve as on-ramps, providing access to anyone who wants to be on the electronic superhighway."
This is all well and good, but Runyon didn't stop there. He then stepped off into the minefield of electronic security, privacy, and the Clipper chip, saying that perhaps the Post Office should be certifying electronic messages to safeguard privacy, "securing one company's market-sensitive information from the intruding eyes of its competitors." Other postal officials subsequently acknowledged that forays into encryption and security would be in coordination with Commerce and Justice Department efforts.
The Postal Service has generally done a good job of cutting costs and improving service, thereby fulfilling its central mandate. But teaming up with agencies who would infringe upon our individual freedoms using Clipper-based encryption technology runs counter to the idea of universal access and is an idea that belongs in the dead-letter box.
Jonathan Erickson
editor-in-chief
Copyright © 1994, Dr. Dobb's Journal