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Saturday, September 04, 2004
Today's postal systems are staring over a precipice. Unless they reinvent themselves, some observers say, they won't last two decades - let alone a century. Can hand-delivered paper survive in the world of e-mail and instant messaging?Despite ominous trends, the answer, surprisingly, is almost certainly yes.The death of the letter can be likened to the myth that people wouldn't travel once they could communicate on the Internet, says Paul Saffo, director of The Institute for the Future in Menlo Park, Calif. In reality, he says, "the more you communicate electronically, the more you travel."The same holds true for letters and packages. "The more you communicate electronically, the more you're going to move physical stuff around," says Mr. Saffo, who has been tapped by the United States Postal Service (USPS) and the private sector for insights into what's going to happen to mail delivery. To be sure, postal services face big challenges. Private package-delivery firms continue to eat away at generally profitable parcel-post services. E-mail is catching on. People already receive 25 times as much e-mail as letter mail - an estimated 31 billion e-mails a day. That total could double by 2006. Most worrying of all: The volume of letter mail delivered worldwide dropped 2.5 percent in 2002 (the latest figures available) after peaking the year before.In many ways, the US - which accounts for some 45 percent of the world's mail - is leading the charge into the abyss for postal systems, experts say.Even the most optimistic USPS projections show first-class mail volume dropping from 102.4 billion pieces in 2002 to 100 billion in 2008. At the same time, the number of addresses that USPS must deliver to increases each year by 1.5 million to 1.7 million .The bills and statements they send out, and the checks customers send in return, account for about 25 percent of the mail stream. If these transactions move to the Internet, the result would be "devastating," he adds.Already, USPS estimates that about 15 to 20 percent of such transactions are online. Within the next two or three years, most banks will begin to return only images of checks, Saffo says, which could trigger a domino effect. Once people don't get the actual checks back, they may say, "Oh, what the heck, I'll start paying my bills electronically," he adds.Meanwhile, the USPS is fighting back with better service and more imaginative products. It announced in July that 96 percent of its local first-class mail was delivered overnight, an all-time high. Stamps are now available not only at 38,000 post offices but at some 200,000 other locations as well, including the Internet. Unmanned automated postal centers, similar to ATMs, allow 24-hour mailing. And a test program in partnership with the private firm stamps.com allows customers to create real postage stamps with their own photos on them. Our blog also covered this earlier. Either postal services will morph into organizations that can afford to deliver letters, or private firms will jump in. "But something will fulfill that function."
