USPS EPM Comparison and controversy

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United States Postal Service - Electronic Postmark^TM

DigiStamp's collection of links and information on this competitor

Part 1, DigiStamp's service comparison with USPS Electronic Postmark is linked here

Part 2 Contents

		Is the USPS a government organization?
		Does the government have any business offering a digital time stamp?
		Is the USPS playing fair?
		We're not the only ones who question the USPS's direction.



	Is the USPS a government organization?
	It might be best called a quasi-government organization. It has some government-like behaviors: Not subject to taxes: gas, income, property, sales tax. Any profits belong to the taxpayers. Exists exclusively to provide universal mail service to all Americans. That's why the USPS has been granted several advantages that shield it from market forces. Has no investors or shareholders. Has 2000 federal law enforcement officers as employees. "The Postal Service lost a total of $85 million [on new business], showing a profit on only one of these many services. Who do you think paid for that? The Postal Service consumer.", Rep. John McHuch, R-N.Y. before an April 29, 1999 vote in the Government Reform committee. The electronic postmark has cost the postal service more than $30 million. Reports show by 1997 a cost of $20M for R&D and then by 2002, $9 million developing the service. When compared to DigiStamp's cost, this sounds like a government project.


	Does the government have any business offering a digital time stamp?
	We think that the USPS could serve a better purpose in the development of e-commerce. In our field, we'd welcome an initiative by the USPS and other government bodies to license or certify private businesses that provide this service, so that the public could increase its trust. Just as government regulation rescued the insurance industry in the nineteenth century, wise policies could foster the development of a reliable digital trust network. But presently, the USPS is our competitor. A question troubles us: Why is the government entering the business of providing digital time stamps? We think the government has many important roles to play in business. * Our country owes our high level of health care to the government's willingness to fund basic research that profit-oriented businesses won't touch, for instance. * Only the government can perform certain policing roles. * Some products, like education, are so important to the public welfare that having national policies—or even federal financing or services—makes the most sense. We certainly need the USPS to do what our founding fathers intended it to do—bind the country together by moving the mail. We don't need it moving into profitable enterprises where there's no problem that needs government attention. Any company that develops products and services needs to know that it will compete on a level playing field. That's the main role of government in business—to insure that everyone abides by the policies and practices necessary for our common good. No company needs to be worried that the government will step into its market, using the vast influence and power of the state to drain the profits away from creative pioneers. Yes, there's money to be made in this field—thank goodness! But the government has no business laying claim to this important industry for itself. The government is supposed to police a level playing field—not bully its way onto the field and claim the profits for itself.


	Is the USPS playing fair?
	Yes, at DigiStamp we do a better job. But we're concerned that the USPS seems to be using its unique status as a government agency to market its services to the public. That threatens private industry. That 2000 pound gorilla can wreak havoc if he wields his enormous, clumsy strength against a new business. Here are a few examples of the USPS leveraging its influence unfairly. The USPS marketing materials say that their service has special legal standing; but when asked in a 2004 court case they admit that it does not. PCWorld October 21, 2003 A new software plug-in from the United States Post Service and Microsoft... ComputerWorld October 21, 2003 Microsoft, U.S. Postal Service offer electronic postmarking Business Wire June 3, 2003 "The Electronic Postmark offers significant value by providing a level of security and trust to electronic correspondence generally associated with physical First-Class Mail," said Nicholas Barranca, Vice President, Product Development, U.S. Postal Service. Full text here Business Wire October 17, 2003 "Microsoft is excited to offer our customers a solution for conducting business securely online with the United States Postal Service," said Gytis Barzdukas, director, Information Worker Product Management Group at Microsoft Corp. Full text here We're concerned. And we've entered a formal complaint with the Postal Rate Commission to encourage additional review and oversight. The actual complaint and a letter written to the Postmaster General, John Potter, asking him to clarify what USPS' is up to. (Read our complaint here.)


	We're not the only ones who question the USPS's direction.
	Direct competition from the government discourages private enterprise from developing new products. Do we really want technological innovation to be left to bureaucrats? Do we want the best minds afraid to develop new business for fear that the government will step in and take over? We don't like the USPS competing with private enterprise where there is no overriding public need for it to do so. We don't like it for ourselves—and we don't like it for the country. And we're not the only ones:
	President's Commission on the United States Postal Service In a report addressed to the President on July 31, 2003 by James A. Johnson and Harry J. Pearce Co-Chairs. Full text here. Excerpts:
	Computer & Communications Industry Association (CCIA) Excerpt from the analysis paper from the Computer & Communications Industry Association (CCIA): “…we would like to reiterate our deep concerns about the Postal Service’s forays into electronic commerce and other commercially competitive ventures,…” “…Encouraging the USPS to use its monopoly government position to subsidize unfair competitive ventures against free enterprise cannot be reconciled…” The above is from a study dated March 13, 2003, written by Edward J. Black, President and CEO CCIA and endorsed by a variety on consumer groups and businesses. Complete text is here. Additional reading on the CCIA web page titled government competition
	United States General Accounting Office Excerpt from their report date December 2001, "...stakeholders have expressed concerns that USPS is establishing e-commerce products and services in competition with those already existing in the private sector, a role they regard as not appropriate for a government entity.“ Complete text is here.
	PostalWatch Quote from Rick Merritt, Executive Director of Postwatch in his organization's submission to the President's Commission: "General Nolan’s rational for encouraging the postal monopoly to participate in competitive markets is based on a series of fundamentally flawed assumptions". Complete text is here.From the same author, his article Post Office Creep as published in the Washington Times is here.