USPS: Address Unknown?

WASHINGTON (06/08/2000) - The U.S. Postal Service's decision to become a dot-com earlier this year really hit the mark, but not as USPS officials intended.

The Internet address change from to ostensibly reflected the agency's burgeoning electronic commerce strategy, which began with business-to-business applications for supporting traditional shipping customers and recently evolved to include support for online communications.

But the dot-com moniker also reflects the agency's competitive landscape. USPS believes it could lose tens of billions of dollars in revenue each year as people turn to the Internet to send messages and pay bills.

Rather than watch its business dwindle, the Postal Service has decided to strike back, extending its traditional services to the online arena. New services include electronic postmarks and certified delivery for e-mail, as well as its own e-bill service.

That is where the agency's real trouble begins. A vociferous group of critics charge USPS with overstepping its bounds by moving into online communications.

The Postal Service has numerous unfair advantages, critics say, including a multibillion-dollar revenue base in first-class mail, from which it can fund its New Economy venture.

At first glance, the argument makes sense. USPS is chartered with providing communities nationwide with reliable and affordable mail delivery, no matter where they are located. That charter does not include e-mail, and USPS appears to have no business competing with the private sector in this new arena.

But, in fact, USPS is forced to compete. Recast as an independent agency in 1971, the Postal Service must make enough money to pay its operating costs.

That is, the agency must run itself like a business - even though its charter still requires the agency to provide "universal access" to mail delivery, something no business would be saddled with.

As long as the nation is committed to this model of public mail service, it remains in the government's best interest to give USPS the ability to react as dot-coms stream into the market and erode the agency's revenue base. To do otherwise is bad business.

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