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

Ch. 7-Telecommunication and Computer Industries, EMS Privacy and Security, and USPS Long-Term Viability .77

sional revision of the Communications Act. As
noted in chapter 2, S. 898 as passed by the
Senate would limit FCC jurisdiction to USPS
EMS services involving USPS leasing of tele
communications from private firms, and then
only to establishing costs of the telecom
munication portion of the EMS service and to
assuring that such service is offered by a sep
arate organizational entity within USPS.
More recently, various computer service and
data processing firms, among others, have ex
pressed concern that a USPS role in Genera
tions I or II EMS, let alone Generation III,
could violate Federal Government policy (ex
pressed, for example, in OMB Circulars A 76
and A 121) that the Government should not
produce goods and services otherwise avail
able from the private sector and should not
compete with private firms, except as a last
resort. USPS has procured the computer and
electronic equipment for E-COM from private
firms, but USPS operation of E COM is con
strued by some to constitute a computer based
electronic message processing service.6 It is
unclear whether or not this is any different
from USPS owning (through purchase from
private manufacturers) and operating its own
fleet of nearly 120,000 vehicles as it does
1o
now.
At present, the use of computers and mes
sage processing in the E-COM service is inter
nal to USPS, and serves to convert the elec
tronic input to hardcopy output within a given
postal facility. As long as USPS is not in
volved in telecommunication or electronic de
livery, there is no direct competition with pri
vate Generation III EMS providers. However,
various Generations I and II electronic mail
providers and computer service bureaus be
lieve that USPS to some extent is competing
with them. These firms have suggested several
alternatives (discussed in ch. 8) to establish
what would be, in their judgment, a coopera
tive rather than competitive relationship. As
mentioned in chapter 2, H.R. 4758, introduced
"See Association of Data Processing Service Organizations,
position paper on Government Provision of Electronic Mes
sage Services, " Feb. 16, 1982.
'Annual Report of the Postmaster General fiscal 1980, p. 14.

in the 97th Congress and the subject of exten
sive hearings by the House Government Oper
ations Subcommittee on Government Infor
mation and Individual Rights,"would appear
to have the effect of prohibiting USPS from
providing data processing or telecommunica
tion services to non Federal entities or persons
unless explicitly authorized by statute.

Competition
Generations

Between
II and III

Other implications for the telecommunica
tion and computer industries are also difficult
to assess. The market penetration projections
suggest that by 2000, even with 100 percent
Generation II EMS stimulation, Generation
III EMS volume (end to end electronic mail in
cluding electronic delivery) would exceed Gen
eration II EMS volume. The sum of electronic
funds transfer (EFT) (a form of Generation III)
plus Generation III EMS would exceed Gener
ation II EMS by the mid 1990's. Under the
high but plausible Generation II EMS growth
alternative, as shown in figure 3, Generation
III EMS would surpass Generation II EMS
by 1990, and EFT plus Generation III EMS
would exceed Generation II EMS as early as
1985. However, Generation II EMS volume
could still be substantial in 2000 and beyond,
even though the Generation II market share
would be declining.
To some extent, perhaps until 1990, Genera
tion II EMS would compete with Generation
III EMS for relative but not absolute market
share. In developing the market penetration
model, OTA assumed that development of
Generation III EMS and EFT would be large
ly independent of the USPS role in EMS (short
of a role in electronic delivery or ownership and
operation of telecommunications). * Prelimi
nary review of the initial responses to the
USPS invitation for telecommunication indus
try participation in E COM indicates that
"See statements of Philip M. Walker of GTE Telenet and
William D. English of Satellite Business Systems before the
Oct. 5, 1981, hearings of the House Government Operations
Subcommittee on Government Information and Individual
Rights.
*See app. A.

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 August 23, 2014.