Category Archives: Blog with BEBdata

Postal Reform Update

Last Thursday, the Postal Reform Act of 2018 (a bipartisan bill), was introduced to the Senate.  It has similarities to the bill introduced last year, which has not advanced to a floor vote yet.  The new Postal Reform Act will include:

  • Elimination of the statutory payment schedule to prefund future retiree health care costs, cancel any outstanding payments, and amortize payments over 40-years.
  • Allow a one-time 2.15% across-the-board rate increase, representing half of what was authorized for the “exigent surcharge”, while freezing any further rate increases until the controversial new rate setting system can be finalized by the Postal Regulatory Commission.
  • Require “strong service reforms”:
    • By improving mail service performance across the country
    • Require transparency and enforcement to ensure the USPS’ accountability
    • Service performance would be stabilized by preserving current services standards for at least two-years.
  • Introduce new non-postal products and services; allow the shipment of beer, wine, and distilled spirits; and urge partnership with state and local governments in offering government services.

Leo Raymond, President of Mailers Hub (a industry advocate) said; “That the bill was introduced is a good sign of awareness among legislators that action is needed to restore the USPS to financial stability, but it’s only one step in the process.”

Both chambers of Congress need to pass the same measure which would be sent to the president for signature.  Given the precarious and combative nature of Washington; we will have to see what becomes of the bill.  We’ll keep you posted!

PRC Proposal – Next Steps

As you have already heard, the Postal Regulatory Commission (PRC) has issued a proposed change to the rate setting process that would authorize a series of over -Consumer Price Index (CPI) increases that could sharply increase postal rates over the next five years.  (For details see our blog; The PRC is Threatening Your Livelihood)

March 1, 2018 marked the deadline to receive comments about the proposed changes, and the PRC got plenty.  The comments received had a consistent theme from industry associations, individual mailing companies and direct mail organizations.

The American Mail Alliance represents associations and individual signers that have come together for the sole and limited purpose of showing unanimity in asking the PRC to reconsider its proposed solution.  The AMA is by far, the largest ad hoc group submitting comments.  They criticized the prefunding burden and noted that the PRC was placing too much focus on the financial health of the USPS as impacted by the Postal Accountability and Enhancement Act (PAEA), stating that most stakeholders in the industry, predictability, rate stability, and transparency have been achieved.  In turn, the group argued that the commission over zealously sought ways to pay the accumulated debts caused by the unnecessary prefunding requirement.

Another rally against the proposed plan came from three groups commenting jointly; (the National Postal Policy Council, Major Mailers Association, and the National Association of Presort Mailers).  They not only argued against the higher prices but questioned whether the PRC has the authority to advance changes to the CPI-based rate setting system.

Other powerhouse organizations that “chimed in” questioning the PRC’s authority to move forward included the Alliance of Nonprofit Mailers, the American Catalog Mailers Association, the Association for Postal Commerce (PostComm), Idealliance, and the Association of Magazine Media.

So, what’s next?  March 1st marked the first phase of comments; reply comments in which commenters critique each other, are due by the end of the month.

After that, the PRC faces the task of digesting the input it has received and developing responses to comments.  They can produce a revised proposed rule (presumable acknowledging the industry’s concerns); or they can issue a final rule presenting the changes it plans to implement.

A second proposed rule would repeat the comment and, perhaps, reply comment periods, while a final rule would set a timeline on which it would be implemented.

The commission’s deliberations could reasonably take at least sixty days, meaning a revised proposal or a final rule shouldn’t be expected until late May or early June at the earliest, with implementation (under a final rule) sometime later this year. If a second proposed rule were issued, that would add another sixty to ninety days, at least.

Whether a presumed late-2018 rate filing by the USPS would be impacted is unknown at this time but, regardless, nothing will change about how USPS rates are set until the PRC’s rule making is concluded.

Of course, it’s widely anticipated that a law suit in federal court against the PRC’s final rule – no matter what it is – particularly given the opinion of some commenters that the commission lacks the legal authority to do what it’s proposing. If there is litigation, the final outcome is anybody’s guess!  We will keep you posted as this important issue unfolds.

Erasing Boundaries with AI

A Forrester Research Report released in November, gave some Big Data Predictions for 2018.

The number of global survey respondents at enterprises with more than 100 terabytes of unstructured data has doubled since 2016. However, because older-generation text analytics platforms are so complex, only 32% of companies have successfully analyzed text data, and even fewer are analyzing other unstructured sources. This is about to change, as deep learning has made analyzing this type of data more accurate and scalable.  Read more here.

BIG DATA PREDICTIONS

A Forrester Research Report released in November, gave some Big Data Predictions for 2018.  25% of Enterprises will supplement point-and-click analytics with conversational interfaces.  Querying data using natural language and delivering resulting visualizations in real time will become standard features of analytical applications.

PRC is Threatening Your Livelihood

The Postal Accountability and Enhancement Act (PAEA) dictated that the Postal Regulatory Commission (PRC) conduct a study of the past decade to determine if the current system for regulating rates and classes for Market Dominant Postal Products was achieving its objectives.

Those results were published on December 1, 2017 and the PRC concluded that the current system achieved some of its goals, but overall the system has failed.

The PRC issued a Notice of Proposed Rulemaking that would give the USPS the authority to raise rates by at least 2% above the CPI for each market dominant rate class for five years.  It also allows for an additional 1% increase if they hit service and productivity standards, and will be required to raise prices for “underwater products” (Periodicals and Nonprofit mailings for example) by a minimum of an additional 2% above the price change authority to move prices toward full-cost coverage over time.  This could drive rate increases for standard letters (officially known as Marketing Mail Letters) up by 27% and flats by more than 40% over the next  five-years.

These proposed changes to the current postage rate ceilings are inflated and threaten the vitality and efficiencies of the postal service and our industry as a whole.

The PRC is an independent agency that has exercised regulatory oversight over the Postal Service since its creation by the Postal Reorganization Act of 1970. It is composed of five Commissioners, each of whom is appointed by the President and subject to confirmation by the US Senate, for a term of six years. To ensure bipartisanship, not more than 3 of the Commissioners can belong to the same political party.

The PRC is tasked with ensuring transparency and accountability of the USPS and fostering a vital and efficient universal mail system.  They act as an independent regulator for engaging postal stakeholders to promote a robust mail system through objective regulatory analyses and decisions.  Normally, the PRC does not have the final say when it comes to postage rate increases.  That is for the USPS Board of Governors.  However, this is not a rate case.  This is a 10-year review of the system which the PRC reigns supreme.

The argument that the USPS has accumulated losses of $59.1 billion include the $54.8 billion needed to prefund their already financially healthy retiree health plan; even though no other entity is required to do the same.

The current regulations force the USPS to reduce costs and raise efficiencies which is needed now more than ever as many economists expect inflation to increase.

Thursday, March 1, 2018 marks the end of a 90-day comment period.  There is another 30-day (one month) period allowed for replies to comments before a ruling can be implemented.

We are very active with industry associations and sit on several industry boards.  Together we are  fighting to prevent this travesty from happening.  The industry will continue to stand united and push the USPS to focus on rate increases specifically tied to cost efficiencies only.  We will keep you abreast of the situation as it unfolds.

UID’s Explained

A unique identifier (UID) is a numeric or alphanumeric string that is associated with a single entity within a given system. UIDs make it possible to address that entity, so that it can be accessed and interacted with.

Examples of Unique Identifiers:

URI-Uniform Resource Identifier is a unique identifier that makes content addressable on the Internet by uniquely targeting items, such as text, video, images and applications.

URL-Uniform Resource Locator is a particular type of URI that targets Web pages so that when a browser requests them, they can be found and served to users.

UUID-Universal Unique Identifier is a 128-bit number used to uniquely identify some object or entity on the Internet.

GUID-Global Unique Identifier is a number that Microsoft programming generates to create a unique identity for an entity such as a Word document.

UDID-Unique Device Identifier is a 40-character string assigned to certain Apple devices including the iPhone, iPad, and iPod Touch.

IoT, What Does it Mean?

The Internet of Things (IoT) is a system of interrelated computing devices, mechanical and digital machines, objects, animals or people that are provided with unique identifiers and the ability to transfer data over a network without requiring human-to-human or human-to-computer interaction.

A Thing can be any natural or man-made object that is assigned an IP address and can transfer data over a network.  A dog that has a microchip implanted or a car that has built-in sensors to alert the driver when a car is too close to stop safely are good examples of a “thing” in the Internet of Things.

IoT has evolved from the convergence of wireless technologies, micro-electromechanical systems (MEMS), microservices and the internet. The convergence has helped tear down the silo walls between operational technology (OT) and information technology (IT), allowing unstructured machine-generated data to be analyzed for insights that will drive improvements.