Online P.O. Defends Payment System

Friday, November 17th 2000, 12:00 am

By: News On 6

WASHINGTON (AP) â€” A month after a large computer industry group criticized government entities for competing with private companies to offer online services, the U.S. Postal Service defended its actions in a letter to Congress.

The Postal Service recently announced its ``eBillPay'' service, which allows consumers to pay bills online. But several other companies trying to muscle into the new market charge that the Postal Service has an unfair advantage over the private sector.

The letter dismayed at least one legislator, who said Congress may have to take steps to rein in the Postal Service.

``The Postal Service in the bill presentment area is already running afoul of what government policy is, and it's not good for the country and not good for them,'' Rep. Zoe Lofgren, D-Calif, said Thursday in an interview with The Associated Press. ``It looks like we will have to be more active than I'd hoped.''

In the letter obtained by The Associated Press, the Postal Service's official in charge of government relations denied that the postal monopoly is competing with the private sector, saying instead that it is ``enabling the private sector by providing essential infrastructure with universal coverage and access.''

An October study commissioned by the Computer and Communications Industry Association accused the Postal Service, Internal Revenue Service and other government entities of having an unfair advantage over private companies when they offer services such as online bill paying or tax preparation.

In the case of these services, the report said, ``the government seems to have overstepped the boundaries that should apply to public provision of goods and services.''

CCIA represents a long list of tech giants, including AT&T Corp., Verizon Communications, Yahoo! Inc., and Nokia. E-Stamp Corp., a new company whose electronic stamp printing service is approved by the Postal Service, is also a member.

Lofgren said several legislators think government should keep out of most of the e-commerce market. She said the Postal Service's actions may slow technological advances.

``When you have a government occupying private economic space, you chill innovation. Government does a lot of great things, but one of the things that government does not do well is be creative and innovative,'' Lofgren said. ``That's done in the private sector.''

In an interview Thursday, spokeswoman Sue Brennan cited new markets that the Postal Service created â€” such as the first American bank â€” then bowed out of.

``Everyone is predicting this huge boom in the industry, and people trust the Postal Service,'' Brennan said. ``I don't think (the online bill paying market) has enough business right now for there to even be competition. If and when it booms, there may be a time when we don't want to do it anymore.''

Brennan sees eBillPay as one more way to bridge the so-called ``digital divide'' and bring Internet services to all Americans.

``What we are doing is enabling communication in this country, and the American consumer will ultimately decide,'' Brennan said. ``Our universal mandate takes us everywhere, even online.''

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On the Net: Computer and Communications Industry Association: http://www.ccianet.org

Postal Service: http://www.usps.gov