Pitney Bowes 2006 Annual Report Download - page 6

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For our industry, the enactment of postal legislation in the U.S. and similar efforts by
governments around the globe to modernize postal services parallel a revolution occurring
on the Internet: Web 2.0. This term was coined to describe the harnessing of the Internet
to foster user-generated content, instantaneous information sharing and networked
collaboration among users. The transformation occurring throughout the global mailing
industry is fostering similar information sharing and networking, providing more flexibility
and transparency, and stimulating innovative partnerships
across the industry in ways never seen before. We call
this fundamental shift Mailstream 2.0.
Pitney Bowes is ideally situated to support the growth
of the Mailstream 2.0 revolution. Our technologies and
services form critical components of this dynamic, information-rich and secure
communications platform. In this annual report, you will read about how we are helping
organizations of all kinds—public and private, large and small, domestic and international—
achieve their strategic goals by leveraging the capabilities of this new mailstream.
Amid all these industry changes, Pitney Bowes is also transforming itself. We have expanded
our capabilities and boosted our productivity, and in the process have become a more
innovative and collaborative organization. More than 26 percent of our revenue now comes
from businesses we were not even in six years ago. And although our traditional mailing
businesses remain strong, they will gradually account for a relatively smaller—though
still significant—percentage of total revenue as new business areas continue to grow.
To help investors and other stakeholders better understand and track our new business
model, we created seven new reporting segments in 2006: U.S. mailing, international mailing,
production mail, software, management services, mail services and marketing services.
Through these segments, we are expanding our value proposition beyond our traditional
strengths in the production phase of the mailstream—our mail finishing solutions—and
moving more deeply into other areas: content creation, primarily through our software
segment; the distribution of mail, documents and packages through the mail services
segment; and end-to-end mailstream management, principally through our refocused
management services business.
These segments make it easier for us to leverage the synergies among the more than
65 companies we have acquired since 2001, and thereby create integrated mailstream
Our growth strategies
are working.