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

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

Impact on USPS-Delivered
Mail Volume
The market penetration results (ch. 4) in
dicated that USPS delivered mail volume (con-
ventional plus Generation II hardcopy output)
is one key consideration. USPS delivered vol
ume is in part a function of the rate of Genera
tion II EMS growth and the degree of stimula
tion of the Generation II EMS market. The
faster the rate of growth (and the earlier the
take off) and the greater the stimulation of
new message traffic, the larger the Generation
II EMS volume (and hence USPS delivered
volume), assuming that USPS delivers Gen
eration II EMS hardcopy output. There is cur
rently little consensus on the extent to which
the various alternatives would contribute to
Generation II EMS growth and volume.
Impact on USPS Finances
The revenue/cost results (chs. 5 and 6) in
dicated that EMS cost displacement and con
tribution to USPS fixed costs are also key
considerations. The greater the EMS cost dis
placement (avoidance of conventional mail
stream costs) and contribution to USPS over
head, the less likely the need for service (and
labor) reductions. Again, there is lack of agree
ment between the USPS and major stakehold
ers. While Mailgram apparently provides both
a substantial cost displacement and contribu
tion to fixed costs, it is not clear whether
E COM would do likewise at current rates and
in its present configuration. All parties, in
cluding USPS, agree that the RCA cost esti
mates prepared for the electronic message
service system (EMSS) in 1977 and the orig
inal E COM cost estimates prepared for PRC
in 1978 are now outdated. A comprehensive
cost review of E COM is needed.
Impact on USPS Labor Force
Based on the chapter 6 labor requirements
analysis, the size of the USPS labor force is
determined principally from the volume of
USPS delivered mail and labor productivity.
There is general agreement that USPS partic

ipation in EMS would generate only a relative
ly small number of new jobs. However,
through higher mail volumes it could offset or
at least defer significant labor reductions that
would otherwise be necessary.
There are an estimated 200 persons (125 op
erations, 50 maintenance, 25 marketing and
administrative) currently working on E COM,
and a fully deployed service (at 150 serving
post offices (SPOs) compared to the current
25) is estimated to require perhaps 2,000
persons.
In contrast, the additional volume from
USPS delivery of industry hardcopy output
under the baseline assumptions would require
about 38,000 employees more than would
otherwise be necessary. The additional mail
volume from 100 percent Generation II EMS
stimulation and high but plausible Generation
II EMS growth would require 39,000 employ
ees more than otherwise would be needed, for
a total of about 77,000 employees. Put dif-
ferently, under the baseline assumptions, the
year 2000 USPS total labor force reduction is
projected at 29 percent assuming no USPS
participation in EMS (i.e., industry delivers its
own Generation II EMS hardcopy output), but
at only 17.5 percent for USPS delivery of
Generation II EMS output coupled with high
but plausible Generation II EMS growth and
100 percent stimulation (see fig. 11 and table
16, ch. 6). Absent the 100 percent stimulation,
the labor force reduction is projected at 23.3
percent.
Space in SPOs for Carrier
Output Equipment
A continuing issue is whether and how
USPS should provide space on USPS premises
for carrier equipment. For the Western Union
Mailgram service, USPS has agreed to locate
and operate Western Union printers in 144
SPOs. Other telecommunication carriers have,
in the past, asked USPS for a similar arrange
ment. USPS indicates that it is willing to con
sider any serious proposals along these lines,
but that none have been received. The carriers

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 April 19, 2014.