1. MTAC Workgroup 114 Establish Service Standards and Measurement First-Class Mail Measurement July 24, 2007 FCM Subgroup Meeting

2.  Letters/Cards: 94.9% (92,678,151,543 pcs) ●Automation = 90.4% (estimate of all letters) ●Manual = 9.6% (estimate)  Flats: 4.5% (4,399,105,242 pcs) ●Automation = 54.4% (estimate of all flats) ●Manual = 45.6%  Parcels: 0.5% (540,194,602 pcs) ●Single-Piece/Retail = 99% ●Commercial = 1%  Special Categories? BRM? Remittance? Other?  No drop ship entry – all origin-entered for purposes of measurement First-Class Mail Product Mailstream

3. USPS Proposed FCM Measurement Solutions Product Type/Entry% Product Volume (estimate) Proposed Measurement Solution TimelineBarrier Letters/Cards -- Automation 85.8% IM™BC and retail measured by EXFC 2008 Mandatory in CY2009 Use of IM™ and electronic manifesting Letters/Cards -- Non- Automation 9.1% Not Measured Flats -- Automation 2.5% IM™BC and retail measured by EXFC 2008 Mandatory in CY2009 Use of IM™ and electronic manifesting Flats – Non-Automation 2.1% Not Measured Parcels -- Retail 0.5% IM™ package barcode / DELCON Ready Use of DELCON Non-POS sites Parcels – Commercial 0% IM™ package barcode CY2008 Use of DELCON PTS upgrade Other? QBRM? Remittance? ???

4. FCM Letters/Cards – Automation (85.8% of product mailstream) Data Capture PointTechnologyTimelineBarrier Start the Clock: Scan largest shipping unit (pallet, tray, sack, bundle, tub) at Induction or Acceptance Electronic manifest Seamless Acceptance Mail.dat / Web services Scan of Pallet & Container barcodes with IMD Seamless in pilot 164 SV scanners deployed Mailer: willingness / enough sources to implement required barcodes and systems IMD s/w update BMEU scanners Interim Scans: Inter-facility Intra-facility Transit Secondary arrival DU arrival Intelligent Mail™ barcode IM™ tray barcodes IMVIS infrastructure (“data cop”) IMD Seamless pilot + expanded usage in summer 0 DU dock scanners (could use carrier IMD) Exit Scan: DPS Scan IM™ barcodes

5. FCM Flats – Automation (2.5% of product mailstream) Data Capture PointTechnologyTimelineBarrier Start the Clock: Scan largest shipping unit (pallet, tray, sack, bundle, tub) at Induction or Acceptance Electronic manifest Seamless Acceptance Mail.dat / Web services Scan of Pallet & Container barcodes with IMD Seamless in pilot 164 dock scanners deployed Mailer: willingness / enough sources to implement required barcodes and systems IMD s/w update BMEU scanners Interim Scans: Inter-facility Intra-facility Transit Secondary arrival DU arrival Intelligent Mail™ barcode IM™ tray barcodes IMVIS infrastructure (“data cop”) IMD APPS & SPBS / FSM Seamless pilot + limited usage in summer 164 SV devices deployed 0 DU dock scanners (could use carrier IMD) Resolution of IM bc height & UFSM reader Exit Scan: Incoming Secondary scan Bundles – IM™BC scans at DU FSS-DPS scan IM™ barcodes IMD IMD fully deployed-Sept FSS – 2010 IMD needs s/w upgrade

6. Parcels – Retail or Commercial (0.5% of product mailstream) Data Capture PointTechnologyTimelineBarrier Start the Clock: Retail or plant arrival: Induction Acceptance scans EVS manifest “Scan 5” at plant POS DELCON scan at DU retail Carrier scan at pickup EVS usage expanded 164 SV scanners deployed IM Parcel barcode widely used Mailer participation: willingness / enough sources to implement required barcodes and systems Non-POS sites? PTS s/w upgrade Interim Scans: Inter-facility Intra-facility Transit DU arrival Intelligent Mail™ Container barcode scan APPS, SPBS scans IMD 0 DU dock scanners (could use carrier IMD) SPBS upgrade-Oct ‘07 Exit Scan: Delivery “DelCon” scan (delivery or attempted delivery) Intelligent barcodes IMD IMD fully deployed-SeptSize of label in relation to smaller packages

7. Forwards / Returns Data Capture PointTechnologyTimelineBarrier Start the Clock: Forwarding/Return scans Redirection data: PARS (letters) CFS (letters / flats) Carrier event scan (parcels) First Class (letters, flats, parcels)-available now CFS – May 1, 2007 PARS – Sept. 2007 Customer adoption of IM™ barcodes, ACS service & field training  Data can be captured on letters, flats and parcels ●After identification, tracked same as non-UAA mail

8. Measurement gaps  Non-automation letters & flats  Manual mail  Start the clock for QBRM / BRM

9.  Which mailstreams will have measurement solutions ready for 2008?  Which mailstreams will have measurement solutions ready for 2009? ●Are interim solutions needed prior to 2009?  Strategy for low volume mailstreams ●Is the same type/frequency of measurement needed? ●Performance-based measurement systems? (e.g. if performance goes below x% 2 consecutive quarters, additional measurement/reporting required, etc.) First-Class Mail Measurement