[dropcap style="font-size: 60px; color: #9b9b9b;"] H [/dropcap]ow has the digital age changed your life? Do you still shop in a store or buy online? Get the newspaper delivered or have an online subscription? Read hard copy books or use an e-reader? If you chose the digital options, you are not alone. You may be a digital native, one of those who are most comfortable working in a digital environment.

The Internet and the digital economy are fundamentally changing communications, transportation, and commerce. This “digital revolution,” in combination with the great recession of 2008 to 2009 has affected postal operators all over the world causing a steep decline in the volumes of personal, business, and advertising mail. This shift from the physical will only accelerate as digital natives become more prominent in the workforce.

In a white paper released today, the Office of Inspector General analyzed the changing digital landscape as the first in a series of papers on the Postal Service role in the digital age; here is a sample of the key trends:

1.There is a progressive shift from the physical to the digital by business, government, and consumers.

2.Control has shifted from the sender to the receiver.

3.The Internet has evolved from mass broadcast media to personalized conversations.

4.Explosive growth of mobile devices increases consumption of content “on the go”.

5.E-commerce is growing rapidly but has not reached its full potential.

6.Mobile commerce is positioned to grow significantly in the U.S. market.

7.Digital technologies have facilitated global commerce.

Though there has been a rapid shift of communications and commerce from the physical world to the digital, there are shortcomings and fundamental gaps that prevent all U.S. consumers from migrating into the digital world. They include:

•The Internet and all of its functionality is not available to all citizens to reap its economic benefits. There is a lengthening tail of digital refugees, which will only increase as the digital revolution progresses;

•There is a potential threat to the principle of “network neutrality,” nondiscrimination in access to communications networks;

•There is still a lack of an adequate level of privacy, confidentiality, dependability, and security in digital communications and transactions as desired by citizens, with the potential of involuntary profiling of consumers;

•The digital infrastructure has limitations in connectivity and bandwidth, provided by companies that could go out of business at any time;

•There are inadequate personal information management tools to effectively deal with the increasing volume of electronic communications and applications;

•There is still insufficient availability of affordable digital currency and secure and convenient financial tools to transact online; and

•There are limits of choice, even withdrawal of the physical option as companies push consumers into digital-only communications.

Given the Postal Service’s role as a trusted intermediary in the physical world, what role do you believe it should take in digital world, if any? Give your comments below.

To learn more, click here to read the paper.


This topic is hosted by the [tooltip text="The Risk Analysis Research Center (RARC) conducts research on economic, business, and policy issues related to the Postal Service. RARC's staff includes experts in economics, operations research, and data analysis."] OIG’s Risk Analysis Research Center (RARC). [/tooltip]

Comments (5)

  • anon

    The OIG is correct on it's assessment. The digital revolution will tremendously affect the Postal Office as we know it today. As a matter of fact, I believe the OIG is underestimating the impact of the digital online environment. As usual the OIG, a government body, has no clue of how to use the new communication media to enhance the Postal System. The OIG only sees gloom and doom. Has it ever occurred to upper management that the Internet will become a boom for parcel shipment? Furthermore, higher gasoline prices and overall inflation will spur consumers to acquire wants and needs at the lowest possible price. In most cases the best prices will be with the most efficient retailers. The retailers that don't have to pay high overhead for mall space. This makes the case for buying items from rural Oklahoma instead of the high retail space of downtown Los Angeles. Moreover, today's consumer just doesn't have time to sit down and read magazines or newspapers. They selectively choose what they read on their PDAs. As in any new market or environment the companies that adapt innovate and execute will be the ones that survive. The Post office has stakeholders that can gain tremendously in this new environment. The US Postal System has one of the most efficient tracking systems in the world. With the help of our customers we can forward communications (strategically placed word) to wherever they move. Furthermore, we can guarantee an item is delivered with signature delivery. The Post office delivers to every address. The list of strengths extends to whom ever is willing to see the potential. Moreover, our mailing customers can use our data systems to enhance their capabilities. UPS does NOT hold the exclusive rights to logistics. The question is will the Post Office recognize the opportunity and capitalize on it? Or will the political bureaucracy blindly grind the Post Office out of existence. One thing is certain business as usual and performance bonuses that are based on fraud are a guarantied path to destruction. Moreover, employees that never show up for work and expect a paycheck cannot be tolerated. There are a multitude of problems that need to be fixed on both the management and labor unions side. Most importantly the Post office needs to get its house in order. If a CPA from outside the Postal System cannot read the books of the Post Office someone has failed. Bottom line. Once we fix the internals of the Postal system we can then try and capitalize on new opportunities. That can only happen by management and the bodies that govern it.

    Feb 24, 2011
  • anon

    You're preaching to the choir. What does the OIG do these days since it's not interested in the investigation and prosecution of those who are guilty of Fraud, Waste, Abuse, and Mismanagement? Guy Nohrenberg tindad@sbcglobal.net

    Feb 24, 2011
  • anon

    That's interesting. The OIG doesn't do any work, eh? Please take a gander at their semi-annual report and then get back to me on that. And the OIG saves the USPS billions of dollars per year, so please check your facts.

    Feb 24, 2011
  • anon

    No kidding! This agency doesn't appear to be interested at all in doing the work they were given to do. The OIG should add themselves to the list when they blog about the reasons the USPS is going down the drain.

    Feb 24, 2011
  • anon

    Since the U.S. Government originally developed the internet (Defense Advanced Research Projects Agency) years ago I believe that the U.S. Postal Service should take over the entire administration of the internet backbone/infrastructure thereby ensuring that ALL U.S. citizens will have access to the internet with complete "network neutrality." The USPS could provide a tremendous amount of services in communications, education, financial, as well as a multitude of other services to benefit all U.S. citizens. Also, the security of the internet would be greatly enhanced by having the Department of Homeland Security work hand-in-hand with the USPS to administer the day to day functioning of the internet backbone.

    Feb 24, 2011

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