Implications of Electronic Mail and Message Systems for the U.S. Postal Service

Chapter 7

Implications for the

Telecommunication and


Industries, EMS Privacy and
Security, and USPS Long-Term


Although the primary emphasis of this
study is on the U.S. Postal Service (USPS)
mailstream and on rates, service, and labor,
a discussion of the effects of a USPS role in

electronic mail and message systems (EMS)
on the telecommunication and computer in
dustries, EMS privacy, and the long term via
bility of the Postal Service is included.

Telecommunication and Computer Industries

A major concern expressed in regulatory
and judicial proceedings by a number of pri
vate sector telecommunication firms, and
more recently by data processing and comput
er firms, has been that a USPS role in EMS
would constitute unfair and perhaps even ille
gal competition with private industry.
Fairness of USPS Role in EMS
Private firms argue that USPS has the fol
lowing advantages: 1) the Private Express
Statutes (PES), which protect certain mail
services from competition; 2) exemption from
income taxes; 3) access to the U.S. Treasury
for investment funds; 4) public funds appropri
ated by Congress; and 5) a cost and ratesetting
process that is complex and difficult to under
stand, which makes cross subsidies possible
between different classes of mail.
On rebuttal, USPS has pointed out that the
PES protect only letter mail from competition,
and then only if it is carried over postal routes
and is not time sensitive. A number of compet
itive alternatives to the USPS letter delivery

services exist that are legal and apparently
viable. These alternatives include private spe
cial messenger services; electronic message
alternatives such as telephone, telegraph,
telex, and privately offered "electronic mail"
services; and certain kinds of media advertis
ing (by newspaper, radio, or television) when
serving as a substitute for first class or third
class advertising mail or direct mail solicita
Competitive alternatives to USPS nonletter
mail include local and regional private delivery
services and successful nationwide delivery
services such as United Parcel Service (UPS),
Federal Express, and Purolater. In some mar
ket segments, such as surface delivery of par
cels, the competitive impact on USPS has been
severe. For example, in 1957, USPS delivered
about 64 percent of total parcel volume and
UPS about 36 percent. By comparison, in
1977, USPS delivered only about 23 percent
'See USPS Marketing Services Division, Competitors and
Competition ofthe USPS, vol. XII, September 1978 and up
dated yearly.

United States. Congress. Office of Technology Assessment. Implications of Electronic Mail and Message Systems for the U.S. Postal Service. UNT Digital Library. Accessed July 11, 2014.