18 . Implications of Electronic Mail and Message Systems for the U.S. Postal Service
USPS to establish a separate organizational
unit to provide EMS service, would prohibit
cross subsidization of EMS from public funds,
would prohibit USPS from owning telecommu
nication services (but would permit USPS to
contract for same), and would limit USPS to
EMS services where the output is physically
delivered through the U.S. Mail.'H.R. 4758,
also introduced in the 97th Congress, would
prohibit all Federal agencies, including USPS,
from providing data processing or telecom
munication services to non Federal persons or
entities unless explicitly authorized by
statute. This bill would appear to prohibit
USPS from offering telecommunication trans
mission and data processing services without
specific congressional approval." In the
'H.R. 2813, 97th Cong.,1st sess., Mar. 25, 1981, to amend
title 39 of the United States Code, referred to the Committee
on Post Office and Civil Service.
*H.R. 4758, 97th Cong., 1st sess., Oct. 15, 1981, to amend
the Federal Property and Administrative Services Act of 1949.
See Congressional Record House, Oct. 15, 1981, p. H7425.
Senate, S. 898, "The Telecommunications
Deregulation and Competition Act of 1981,"
as enacted includes an amendment intended
to clarify provisions of the act relating to elec
tronic mail. The amendment makes clear that
S. 898 does not authorize or prohibit USPS
from offering telecommunication services or
the electronic delivery of messages, whether
by resale or otherwise. If, at some future time,
Congress should authorize USPS to offer such
service or if current law is interpreted to
authorize it, the amendment stipulates the
conditions under which such service would be
offered, including the establishment of a
separate organizational entity, among other
things. Thus, in effect, S. 898 and the related
Senate floor debate prior to enactment reaf
firm the absence of congressional consensus
on the participation of USPS in EMS."
Se congressional Record-Senate, Oct. 7, 1981 . PP.
Study Purpose and Approach
This study addresses three major questions:
1. To what extent are privately offered EMS
and EFT systems likely to affect the
volume of mail handled by USPS?
2. Are changes in USPS mail volume likely
to lead to significant adjustments in
USPS rates, service levels, and/or labor
force requirements? and
3 What are the implications for the future
of USPS and how it might participate in
the provision of EMS services?
At the heart of the study are two computer
based quantitative models. The first is a
market penetration model used to project the
level of conventional and electronic mail
volumes under different sets of assumptions,
and the second is the USPS revenue and cost
model. There are four basic inputs to the
market penetration model: 1) the baseline
description of the mail flows derived from a
survey based on 1977 data conducted for
USPS by the Survey Research Center at the
University ofMichigan; 122) a set of EMS and
EFT technology assumptions; 3) a set of
assumptions about the underlying growth rate
of the mainstream; and 4) the range of selected
alternatives (e.g., low, medium, high growth)
for EMS development. The market penetra
tion model is explained in chapter 3 and ap
pendixes A and B, and the results are outlined
in chapter 4.
The second quantitative model is the USPS
revenue and cost model. It is designed to pro
ject the impacts of the growth or decline of
overall USPS mail volume (conventional and
EMS) on USPS rates, service levels, and labor
requirements. The USPS revenue and cost
model and the results for first class mail are
presented in chapter 5.
"M. Kallick, W Rodgers, et al., Household Mailstream Study,
Final Report prepared for Mail Classification Research Divi
sion, U.S. Postal Service, 1978.
United States. Congress. Office of Technology Assessment. Implications of Electronic Mail and Message Systems for the U.S. Postal Service. UNT Digital Library. http://digital.library.unt.edu/ark:/67531/metadc39480/. Accessed January 27, 2015.