Postal overhaul could open up IT revenue opportunities

A bill that would allow the U.S. Postal Service to ship liquor and wine, close some mail processing centers, reduce its door-to-door deliveries and reform worker compensation plans could also let the financially challenged organization exploit its massive IT operations for profitable commercial uses.

The legislation, sponsored by Senate Homeland Security and Governmental Affairs Committee Chairman Tom Carper (D-Del.), would give the Postal Service enhanced authority to develop and introduce new non-postal products that leverage its retail, mail processing, transportation and delivery networks. It would also mandate the creation of a chief innovation officer position at the agency to look for creative ways to tap new revenue streams.

A Senate committee staffer told FCW that while the bill doesn't specifically mention the Postal Services' massive IT and data processing capabilities, the potential for the agency to use those facilities to "make a little cash" is there. Ultimately, however, those new applications would have to be approved by the Postal Regulatory Commission, the independent agency that oversees the Postal Service.

The move by a federal agency to open up its IT operations for use by commercial interests isn't unprecedented. Some federal research labs seek out private companies on some projects. Lawrence Livermore National Laboratory opened access to its massive Vulcan supercomputer to industry and academia for collaborative developmental projects, for example.

The Postal Service is known as a worldwide supercomputing leader and certainly no stranger to big data. It provides real-time fraud analysis on 528 million pieces of mail per day with one of the most powerful non-classified supercomputing facilities in the world.

The Postal Service's IT and Accounting Service Center in Eagan, Minn., operates with 16 terabytes of in-memory computing that allows it to scan 6,100 mail pieces per second and compare in real-time relevant information, including carrier and routing data, weight and size, to a database of about 400 billion records.

The Postal Service declined comment on the legislation and on opening up its IT infrastructure for use by others. Hearings on Carper's measure are expected to begin in September.

The agency has already taken a step in the direction of commercializing its IT capabilities with its participation in the Federal Cloud Credentialing Exchange (FCCX) pilot project. The project is part of the White House's National Strategy for Trusted Identities in Cyberspace and allows the Postal Service to assume a digital version of its real-world role, delivering sealed packets of identity data securely between government agencies and identity providers.

The Postal Service Inspector General notes on its webpage that the project could pave the way for people to change an address online by logging into the Postal Service website with the same passcode or smart card they use to file taxes with the IRS or buy books on Amazon.