From...

May 24, 1999
Web posted at: 4:13 p.m. EDT (2013 GMT)

by Anne Fischer Lent

(IDG) -- It's been 79 years since the U.S. Postal Service devised a new way to dispense postage: the postage meter. Now, thanks to Web technology, the Postal Service can offer an update. Called Information Based Indicia, the new stamps are actually digital bar codes that postal workers will read using handheld scanners.

At your end, you'll need software from the Postal Service and an Internet connection. As you would with any e-commerce transaction, you pay using a bank or wire transfer or credit (or debit) card.

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E-postal players

Companies testing products for online postage are taking different approaches. There's a software-only method, which lets you print postage directly onto envelopes or labels. Then there's a software/hardware method that comes with a device similar to a postage meter that connects to your PC and stores downloaded postage.

In March 1998,0 E-Stamp became the first vendor to win the Postal Service's approval to beta-test electronic stamps. Its product, being tested in California and Washington, D.C., includes software that lets you buy SmartStamps over the Internet and store them in a hardware component called the Postal Security Device. The hardware device is based on Cryptographic iButton technology, connects to the PC through the printer port, and stores your security details. E-Stamp plans to complete beta testing and offer the service this summer.

Stamps.com, a software-only Internet postage service, just completed its first phase of beta testing and won the Postal Service's approval to enter its final market test, also in California and Washington, D.C. Designed for use in homes and small businesses, Stamps.com requires you to download its 3.2MB application and set up a meter account and a funds transfer. Then you can download and print stamps with a standard printer.

Not surprisingly, Pitney Bowes, longtime supplier of postage meters, is beta-testing two Internet postage solutions. One uses software only and is similar to the Stamps.com method; the other, similar to E-Stamp's system, uses a device called the Postage Vault.

Faster, surer service

The advantages of online stamp purchases are apparent: You won't have to wait in long lines at the post office to refill the meter, and, what's more, you can process your mail directly from a database application.

The Postal Service also stands to gain. Besides shortening on-site lines, online sales help automate the mailing process, since bar-code stamps are easily read.

The Indicia program may also reduce mail fraud and increase revenue, according to Postal Service representatives. All the methods being tested incorporate several levels of security, from public-key digital signing technology to encryption and more.

There's still room for more automation. The Postal Service hopes to be able to read bar codes online by the end of 2000. For now, its staff is wrapping up the final beta tests of the first products and warming up the handheld scanners.