USPS Expects $92 Million in Annual Savings From New Technology

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The U.S. Postal Service is planning to upgrade its letter-recognition technology, which the agency says will save more than $92.5 million a year.


The improvements will allow optical readers to read 93 percent of handwritten and poorly machine-printed letters, the USPS said yesterday. The technology currently is able to read about 75 percent of those letters.


Just five years ago, the equipment, called Optical Character Readers and Remote Computer Readers, could read only 5 percent to 10 percent of those letters, according to the agency.


This program is the latest in a series of recognition improvement efforts that began in 1996. Savings from this program are expected to exceed $92.5 million annually when fully implemented by 2004.


Mail that cannot be sorted by high-speed automation has traditionally been sorted through expensive manual sorting at a cost of more than $55 to sort 1,000 letters. It costs about $5 to sort the same number of letters through automation.


Thomas G. Day, vice president of engineering at the USPS, said the improvements will enhance handwritten and machine-print address recognition technology used in Optical Character Reader and Remote Computer Reader equipment. The program is expected to improve the system's read rate by 8 percentage points and to reduce the error rate by up to 50 percent.


The USPS Board of Governors has approved funding for the new technology. However, the exact amount of funding is not being released because the USPS is in negotiations with vendors.


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