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Chapter 2
postal operations

Much of the growth can be attributed to efforts to make shipping online easier. New Web initiatives, such as Carrier Pickup™ online notification and the availability of insurance online, are contributing to this success.

In 2004 received about 258 million visits, an increase of 32 percent over 2003. According to Nielsen/NetRatings, the Postal Service Web site ranked as the top brand among U.S. government sites.

In addition, won numerous prestigious awards including the 2004 eGov Pioneer Award for Best Practices in Web site Governance, the 2004 Grace Hopper Award for Innovative Technology Implementation, and recognition by the U.S. Geological Survey as one of the "Top 10 Best Managed Federal Government Web sites."

f. Postage Technology Initiatives and Secure Electronic Services

PC Postage technology and developing postage meter technology make it easier and more attractive for customers to mail with the Postal Service by integrating services such as insurance and confirmation services with postage payment, and by making it easier to print shipping labels, and track and account for postage expenses.

Accomplishments for 2004 include initiatives targeted at expanding use among online and small business customers. New trends in digital technology resulted in smaller postage meter designs that offer features particularly attractive to small and medium businesses. PC Postage technology, introduced originally as stand-alone software products, is now offering enterprise solutions and enabling authorized postage payment for Web-based services, such as eBay and the Postal Service online shipping label option, Click-N-Ship.

Expansion of access and enhancements is accomplished by working with commercial providers to reduce or eliminate Postal Service capital investment, thus providing opportunities for cost savings, cost avoidance, revenue generation, and mail security. Innovations of Internet postage and the Information Based Indicia provide the technology platform for Intelligent Mail service, which enhances the value of mail and moves toward a digital network, including expansion of revenue protection.

During 2004 the Postal Service approved 22 concepts for new meters and PC Postage software features or enhancements. Significant among these were concepts involving further expansion of postage payment integration for enterprise solutions, online auctions and Web-based shipping solutions. An Internet-based platform approved for national distribution was the supporting infrastructure for the eBay initiative. Further, a Postage Development Kit (PDK) was approved in May 2004. The PDK allows customers to gain access to PC Postage functionality from within their own application via a simple ActiveX application programming interface. Four major enterprise customers are expected to complete implementation this year. Additional technological advancements include the first shipping system for the Macintosh computers, the integration of customs forms, and the first market test of a form of customized PC Postage–a product concept recommended in the July 2003 report of the President's Commission on the U.S. Postal Service.

As of July 2004 growth in mid-range and small business meter population increased 17 percent and 5 percent, respectively, over the same period last year. In the first nine months of 2004 revenues from PC Postage service increased 56 percent over the same period last year.

K. Pricing and Classification

Pricing and Classification has worked to refine and communicate the pricing strategy presented in the Transformation Plan. The underlying principles of the Postal Service's pricing strategy (customize rates and requirements for large and sophisticated customers, simplify rates and requirements for retail and small business customers, and encourage efficiency) demonstrate the overarching premise that pricing should reflect the value derived by customers from their use of postal services.

The strategy is reflected in several initiatives undertaken by the Postal Service in recent months, such as new negotiated service agreements (NSAs), the Domestic Mail Manual (DMM) redesign project, Priority Mail flat-rate box, Periodicals co-palletization, and Repositionable Notes.