US Postal Service 2008 Annual Report Download - page 26

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26 | 2008 Annual Report United States Postal Service
We are potentially subject to various state legislative
proposals that could reduce our revenues, increase
our costs, or otherwise place additional burdens on
our operations.
States continued to introduce Do Not Mail legislation in
2008, with approximately 16 Do Not Mail bills being consid-
ered in 13 state legislatures nationwide. (This includes nine
bills that were carried over from 2007.) These bills, modeled
after the Do Not Call registry, are designed to limit or stop
advertising mail from being mailed to households. Currently,
none of the state bills have passed; however, a few of the
state legislatures may still be in session.
The Postal Service opposes legislation that would limit mail-
ing, or that would interfere with the availability of an afford-
able, universal postal system. The Postal Service will con-
tinue to communicate the value of the mail by building upon
its strong environmental record and its work with mailers on
offering consumers choice on how to manage their mail. By
working aggressively with mailers, marketers, and advertis-
ers, the Postal Service can continue to improve the quality
and relevancy of advertising mail.
Should a state pass Do Not Mail legislation, it would result
in lost revenue for the Postal Service. A financial analysis
conducted by the Postal Service determined that a national
implementation of Do Not Mail legislation would place ap-
proximately $6 billion of postal revenue at risk annually.
We rely extensively on technology to operate our sys-
tems. A significant failure in a material system could
impair our reputation for reliable service and adversely
affect our results of operations.
We rely extensively on technology to operate our systems
for processing and delivering mail. Our intranet is one of
the largest maintained by any organization in the world.
Any significant failure of these systems could cause delays
in the processing and delivering of mail, which could dam-
age our reputation, result in loss of business, and increase
costs of operation.
A failure on our part to protect the privacy of informa-
tion we obtain from our customers could damage our
reputation and result in a loss of business.
We receive a variety of private information from our custom-
ers, such as address change data. We have implemented
a number of safeguards intended to protect the confiden-
tiality of data that we obtain. Any significant violation of the
privacy of this data could damage our reputation and result
in loss of business.
We are subject to the risk of biohazards and other
threats being placed in the mail.
Although we have implemented extensive emergency pre-
paredness measures to keep the mail, postal employees,
and postal customers safe from harm due to biohazards
that could be introduced into the mailstream, there contin-
ues to be a risk of possible biohazard threats. If new bio-
hazards were to arise and our measures were not sufficient
to contain or mitigate the threat, our services could be dis-
rupted. This could adversely affect our revenues, require
substantial expenditures to address the threat, and could
adversely affect our operations and financial condition.
In addition, the U.S. Transportation Security Administra-
tion (“TSA”) has adopted new rules enhancing many of the
security requirements for air cargo, and has proposed ad-
ditional requirements. Until the requirements of these pro-
grams and their application to us are finalized, we cannot
determine the effect that these new rules may have on our
costs or our results of operations. These rules or other fu-
ture security requirements for air cargo could impose mate-
rial new costs on us.
We are also subject to risks and uncertainties that af-
fect many other businesses, including:
Market acceptance of our new service and growth
initiatives;
Adverse weather conditions or natural disasters, such
as hurricanes, which can damage our property and dis-
rupt our operations;
International conflicts or terrorist activities and the effects
these events may have on our business or our results of
operations; and
Changes in interest rates and foreign currency
exchange rates.