PARIS -- A technological revolution is gathering momentum in La Poste, the French postal service.
Frequently derided as one of the last administrative outposts of the old economy, the French postal service is shaking off the dust and getting into the 21st century in a big way.
La Poste has instituted a Cyberpost project, involving the installation of 1,000 Internet terminals in rural and neighborhood post offices throughout France. It is also offering a free Web address and permanent electronic mailbox to every French citizen.
"Our ambition is to become one of the leading information society players in France and across Europe as a whole," said Martin Vial, La Poste's new chairman.
Such rhetoric might ring a little hollow were it not for the fact that Vial, appointed in December 2000, is a fully paid-up cheerleader for the new economy. It is no accident that one of Vial's most recent fact-finding missions abroad took him and his management team to Silicon Valley.
He has also just published a book titled La Lettre et La Toile (The Letter and the Web), setting out his vision of a postal service with e-commerce at its commercial heart.
Since taking the helm at France's national postal service, Vial has had the perfect opportunity to put his theories to the test and step up the pace of La Poste's technological transformation.
One of the first tasks was revamping the administration's creaky production processes by introducing a sophisticated tracking system for packages and installing "intelligent" franking machines in sorting offices.
Further innovation has come through a joint project with the U.S. and Canadian post offices, resulting in PostECS, an electronic equivalent of registered mail targeted at corporate clients and service providers.
Another partnership with industrial group Sagem has given birth to Certinomis, a certification authority for electronic transactions -- one of the first of its kind in the world.
La Poste has also been in the forefront of experiments with "digital wallets" and smartcards, and has been pushing hard for agreed-upon standards governing financial transactions on the Internet.
But while its internal makeover and B2B forays are undoubtedly impressive, more telling still are La Poste's maneuvers to place itself as a major provider of Internet services to the general public.
Its Cyberposte campaign is at the vanguard of this drive, offering every French citizen the right to a free, lifetime e-mail address and permanent electronic mailbox.
"We have invested almost $(FF)200 million a year in Internet initiatives and this figure is set to grow exponentially in the future," Vial said.
People can access their e-mail accounts through La Poste's dedicated consumer portal, Illiclic, or through the special terminals that have been installed at over 1,000 post offices throughout the country.
David Rawnsley, editor of Postmag.com, an online source of news and commentary on the mail and postal industry, said he is "very impressed" with La Poste's modernization efforts.
"They have overcome the greatest stumbling block to any of the post services getting into the electronic world: the resistance of the top man to move away from the traditional postal products," he said. "They are making the right moves and this has surprised a lot of people in the industry."
While the idea of free e-mail accessible from any computer anywhere in the world -- à la Microsoft's Hotmail -- is far from new, La Poste's twist is to offer an e-mail service governed by the same principles as physical mail: that it be secure and confidential.
Holders of electronic mailboxes are able to choose the type of mail that they would like to receive -- or more pertinently, block those annoying ads for Viagra or pyramid get-rich-quick schemes that clog up so much of the Internet's bandwidth.
Vial also stresses an old-fashioned concept lurking behind the Cyberposte initiative: public service.
He said that La Poste is targeting two broad categories of the population with its Internet campaign: people who will use the service to send occasional e-mail messages or surf the Web but don't necessarily want to own a computer, and those who have never used the Internet before.
Vial cites older people and those living in geographically isolated areas as typical constituencies for La Poste's outreach program, but said the overall aim is to bring the Internet to as many people as possible.
"This is why we've placed the cyber kiosks in vastly different areas: town centers, suburbs, small villages, rural areas and so forth," he said.
The economics of the plan are interesting. After all, won't La Poste's new emphasis on electronic delivery cut revenue from the sale of postage stamps?
Although revenue derived from mail postal charges is expected to decrease in the long-term as more people switch to e-mail, La Poste said the volume of letters actually increased by 4 percent last year. Ironically, this is partly attributable to new technology as large numbers of subscribers began receiving their first mobile telephone bills.
La Poste currently derives two-thirds of its revenues ($13.1 billion in 1999) from ordinary mail delivery services and about 13 percent from parcels and logistics.
However, La Poste estimates that over 90 percent of mail services relate to companies rather than individuals -- hence its drive to capture at least 10 percent of the lucrative European parcel and logistics market.
"If you look at what La Poste is up to, they are beginning to work on their electronic products and trying to establish a parcel network outside their own borders," said David Rawnsley, editor of Postmag.com, an online source of news and commentary on the mail and postal industry. "This will pit them against UPS, FedEx -- with whom they are creating a strategic partnership -- Deutsche Post, and TPG."
While industry experts acknowledge the necessity of postal services diversifying into electronic channels, some question how far the process should be allowed to go.
"The central question needs to be whether the proper role for a 21st century postal authority is to compete with private businesses or to merely provide only the kinds of services that a central, nationally trusted entity can provide," said Eric Arnum, editor of Messaging Online, an information service devoted to electronic messaging issues.
The principal difficulty, as Arnum sees it, is marrying the legitimate need of postal services like La Poste to explore new sources of revenue without simultaneously undermining their unique public-service role.
"There are beneficial roles for a postal authority to play in an information society," said Arnum, citing digital signatures, e-mail directories, e-mail time-stamping and change-of-address services as places where post offices can "do the most good for society."
The crux of the matter is deciding how far we want to go in allowing national operators to chase opportunities as traditional mail services decline, Arnum said.
"If we allow them to follow their customers to new information delivery technologies," he said, "then why not let them open a passenger airline or allow them to operate a cable TV network? Or compete with Amazon.com? Who draws the line on what is the proper role for a postal authority?"
In a broader context, La Poste's Internet strategy is very much in keeping with Vial's belief that public service and commercial viability are not incompatible goals.
The ultimate aim is to leverage La Poste's current monopoly of the postal network as a means of fending off competition from private-sector rivals in advance of the partial liberalization of European postal services in 2003.
