01 December 2009 - Steve Lawson - © Hellmail Postal News

Last month I mentioned the growing interest in paper-free mail systems and made a few comments about why I now see it as an important part, if not key to the future for the mail industry. This month I'm digging a little deeper, in a four-part feature, talking to paper-less providers as well as postal operators and seeing whats already out there and which are likely to stay the course and why. Its a complex subject and in my view it would require a couple of hoops to jump through before the world actually takes the paperless model to it's heart and adopts it universally. Part one aims to clarify the role of a paper-free mail systems, security, filtering and how it differs from Hybrid systems.

One thing is clear, European postal operators are taking paper-free mail very seriously indeed. There are a few reasons for that, but top of the list has to be that Europe now has a highly competitive postal market compared to other parts of the world including the U.S. and no one want to miss a trick. From a practical point of view, paper-free provides 24/7 accessibility, reduces operating costs, saves on fuel, and offers environmental benefits.

Since liberalisation, all European postal operators have been paying close attention to what their rivals are doing. This is all about survival, and paranoia is no bad thing in this business. For the moment each is seeing who is putting their toes into which waters first. They know its coming, and some operators, notably the Swiss, have already partly embraced some of this technology with Earth Class Mail. The problem for those operators still pondering is how to get from A to B when you have a postal service that has always done things a certain way and with a business that is, lets face it, highly labour-intensive. For the paperless platform providers, trying to get operators to adopt a model that it is largely invisible takes some doing. Theres also the added problem of convincing customers to sign up to it, even if from a technical point of view, paperless mail is a faster, more secure way to access mail that brings some heavyweight environmental benefits. Take out hundreds, thousands of trucks from the paper processing, delivery and supply chain and you start to get the picture. It also follows that not everyone will be keen to see a paperless mail system...

Like most new technology though, ideas come along and not all of them survive. As I'm a 50s child, my memory of the various technologies that have come and gone, lingers still. Betamax didn't make the grade, even if technically it was a better quality system than VHS, but in hindsight the video player was a rather clunky affair even then. The CD, which we were fairly sure was the ultimate in sound quality and couldn't be improved upon is already being left behind by the MP3, with music playable on a system with no moving parts whatsoever save for the buttons needed to operate it. The DVD already being upgraded to Blu-ray, TV moving to High-Definition and more channels than we could ever feasibly watch. I'm almost breathless thinking about it.

A recent White Paper by paper-free provider 'Zumbox' entitled "What's the real cost of a 44 cent stamp?" makes some interesting points about the benefits of a paperless mail system. The growing disparity between the cost of a stamp and the actual cost of collecting, sorting and delivering a letter makes the paperless idea a sound proposition. Operators even costs out to some extent as part of the Universal Service Obligation but in recent years the disparity has grown so large, some operators are experiencing a sizeable loss. They could raise the cost of stamps, and have, but the long-term projections don't make for comfortable reading and the EU still hasn't come up with a real solution for long-term funding of the USO, unless you count the catch-all "its up to individual countries."

Not all of the costs involved are obvious either. Firstly theres the costs involved in manufacturing and processing paper and whilst there are certainly myths concerning paper consumption and loss of forests, the manufacture of paper requires enormous amounts of energy and manpower. Then there is the printing, and further movement along the supply chain, all requiring transportation and fuel. In fact distribution is a large part of the entire process, all of which plays a part in the contributory factors behind global warming. Then there is disposal. Excuse the pun, but it soon stacks up.

The immediacy if not regularity of mail has declined in recent years and even the UK's own postal service, the Royal Mail, appears to be edging closer to a 9-to-5 model, with breakfast deliveries a thing of the past. Many customers have already switched to online billing, lured by the promise of reductions in their annual bills, and we have become more accustomed to email and text to send messages within seconds to practically anywhere these days. The switch to paper-less for most people will hardly be a giant leap given the existing technology we have become familiar with.

Email was never likely to be a direct replacement for regular mail, and in fact has several weaknesses not least of which is spam, but it has had an huge impact on the postal business and one can even send invoices via this route, effectively bypassing the postal service altogether. This is perhaps another reason why operators are taking it so seriously.

Hybrid mail, which has one foot in the digital world and the other in the pavement-beating world of foot deliveries has already made a small dent in traditional postal services and for print houses it has been seen as something as potential salvation, but its growth is still hampered by the enormous amount of telephone sales involved just to educate users to its benefits and like many of these ideas, those likely to see the most cost-savings are bulk mailers. There are definately some savings to be made in Hybrid Mail and companies are using it, but it strikes me as being somewhat akin to the FAX machine in technological terms. It doesn't fully address the costs involved in logistics and in some cases mail can end up travelling significantly further and arrive later than mail posted the normal way. For me personally, it just seems a luke-warm approach to digital mail and by no means the ideal solution.

Digital mail platforms seem to be following a similar path to all those other technologies, making it difficult for operators to be absolutely sure they'd be investing in the right technology and not left with an unscalable 'lemon'. For a truly paperless system to work in the real world, it has to be global, and based on street addresses rather than a box number in cyberspace, and crucially run in tandem with traditional mail services to enable users to get used to the idea. I can only speculate here. but there is also the small matter of postcodes (PAF) in the UK, now 50 years old and owned exclusively by Royal Mail and leased to various companies and organisations. Even for a system licence it costs £3,850 a year and for a corporate licence it leaps to a whopping £75.000 a year. The cost of licensing has been a regular bone of contention, particularly with non-profit organisations and paper-free mail would still require zip or postcodes to ensure correct delivery if based on street addresses although the reduced postage costs may make licencing the PAF less of a concern to some organisations.

The people behind the U.S. Zumbox platform see its implementation as one that needs to run (initially) in sympathy with regular mail so that customers can still receive post whilst getting familiar with a paperless system. That makes a great deal of sense and is perhaps the most practical way of getting customers to ultimately migrate from one system to another. We do already have a semi-paperless system in the form of online billing but that requires the user to login in to various web sites to check bank statements and bills and each login is based on an account number plus various security measures to authenticate the user. The advantage of a paperless system using house numbers is that all the multiple utility accounts are replaced with one secure post box, much like a traditional postal service and whilst comparing paperless to traditional in terms of loss is not easy to make at this stage, paperless would not appear to be at the mercy of the odd light-fingered delivery worker, and although like all digital communication systems,they can go offline from time to time due to unforeseen technical difficulties, such systems are unlikely to be affected by industrial action.

Swiss Post has already made a deal with Earth Class Mail where customers will be charged a small fee to access their digital mail box. The system does allow access from anywhere although as far as I can ascertain, relies on an operator to scan most incoming mail and is in effect a hybrid system, at least for the moment. Zumbox is digital from the word go, and seems a far more likely model for widespread useage and like Earth Class Mail, the platform can be licensed to postal operators to be rebranded accordingly. The Earth Class Mail system would seem to have real appeal for those on the move, although it is down to an operator to scan all your mail so you can access it.

The Czechs have adopted a 'Data Box' system for communication between authorities, essentially an internal paperless system with correspondance time-stamped and marked accordingly. The system was initially phased in, then made mandatory in November this year and used by courts, police, local councils and tax offices and around 350,000 companies. The Czech Data Box is state-managed rather than a universal paperless mail service, although apparently individual citizens can apply for one.

UK-based NoMorePost, seems to offer a comparable service to Zumbox in that the service is secure, but I found no mention of a street address system, and it does seem to be more like a spam-free email box but with greater capacity. There is however a user-initiated vetting system in terms of who you allow to mail you (which I quite liked), and that has distinct advantages in avoiding being spammed but by the same token it doesn't mirror a traditional mail system where all and sundry can send you post - difficult one to call. The vetting process may in the end make it too restrictive and therefore probably not a direct replacement for conventional post. That said, spam is an issue that would need to be addressed in some way otherwise you might just as well stick with an email box and set up your own filters. The alternative would be a rather messy affair with a mailbox clogged with stuff you simply don't want. I can see it appealling to the DMA, but I don't see a free-for-all digital mail box being widely accepted. The ability to set who can mail you through NoMorePost would seem to solve the problem of spam in one go, but again, the lack of a street address may be short-sighted if the model is to be more widely adopted. That said, software can change in its life cycle (think Microsoft) and I can only go on current specs.

I asked Yarone Goren at Zumbox about the potential for spam:

"There is a cost to send each piece of mail. In the U.S. we charge 5 cents postage per piece. This serves as a forcing function for quality. If a spammer had to pay 5 cents to send each piece, his business model would collapse. We also verify the identity of each sender and recipient and have credit card or billing info for each sender.

"More importantly, Zumbox is a closed system, unlike email which is a loosely connected system of hundreds of thousands of disparate email servers. We are centrally controlled and managed, like a national postal service. To send mail, you must go through us. To receive mail, you must go through us. We monitor mail volumes and other service-quality metrics to ensure the experience is high quality.

"For our mail recipients, we automatically separate all incoming mail into two folders: "mail" (bills, statements, and other transactional mail) and "special offers" (coupons, catalogs, and other promotional materials). If you don't want to see the "special offers", just don't click on that folder. Mail recipients have full control. They can block a particular mail sender and they will never again receive mail from that sender." he said.

On that basis, spamming campaigns (at least on the internet) are virtually free to execute and a cash-up-front filter would indeed put off most spammers with the exception perhaps of lottery scams which even make their way through regular postal systems. At least theres a designated folder for what one might describe as 'junk mail' which you could simply regard as a refuse bin - without the environmental guilt normally associated with hand-delivered junk mail.

Zumbox actively licenses its platform to national posts and private operators around the world, providing them with a turnkey system so they can operate a paperless mail service in their country.

I said I'd mention Hybrid Mail, and how that differs from a paper-free mail service. Hybrid is a mix of digital and foot deliveries. Essentially you create your letter on a laptop or PC, send it digitally and it is then printed and posted in the normal way from somewhere else. Its plus points are not having to deal with wintry showers to make the post box and a small saving on postage costs but I'm not convinced that the green credentials of such systems are all they claim to be, particularly where an item may actually have even further to travel than if you'd simply posted it yourself. However, it does have its followers and still gives operators mail to deliver. I'm certainly not going to dismiss Hybrid as it offers cost savings and can operate within the present structure of conventional postal services. It's downside is that it isn't exactly paper-free so one could argue that its a one foot in and one foot out service - hence the title 'hybrid'.

In terms of security, paper-free mail services all seem to use SSL encryption (the same systems used for credit card handling online). That would seem to be a huge improvement compared to say Royal Mail where the vast majority of mail is untracked and the company has no idea where any particular item of mail is at any given point.

I mentioned earlier that European postal operators take paper-free mail systems seriously. Deutsche Post is already looking to invest in the technology, presumably rather than face the dire consequences of being outrun by another operator or a private enterprise. European postal operators have good reason to be taking these concepts seriously and being first in the door may be crucial here. The decline in paper mail is real enough and all the signs are that it will continue rather than level out as some had hoped. The closing of post offices around the world would certainly indicate that all isn't well with traditional postal services.

In the next feature I'll be looking at the functionality of these technologies, and how soon we can expect the paper-free postal revolution to become part of our everyday lives.

Click here for a print-friendly version of this article

Information on advertising opportunities can be found here