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New and old fight over customers as the letterbox moves online

THE future of the letterbox is being fought over by the 203-year-old Australia Post and high-tech newcomer Digital Post Australia.

Both are betting that Australians will gravitate to digital mailboxes, which allow users to receive and pay bills, communicate with banks, telcos, electricity networks and financial services firms, as well as store documents such as passports and birth certificates.

They will be accessible anywhere in the world from computers, tablets and smartphones, and can support payments directly from the mailbox, with users automatically notified when they have new mail or their bills are overdue.

Australia Post unsuccessfully sued DPA claiming trademark and other infringements and is now appealing. The chief executive of Australia Post, Ahmed Fahour, told a Senate estimates hearing last month that the outcome was “a huge injustice”.

For Australia Post, its $2 billion digital transformation is considered critical to the future of the business.

“We had a monopoly. We had a 100 per cent market share 20 years ago and today we have less than 1 per cent of the market share of all communication,” Mr Fahour said. “Where did the other 99 per cent go? It has gone to digital communication.”

The chief executive of DPA, Randy Dean, is happy to stand in Mr Fahour's way.

“The internet history museum is filled with the fossils of many companies that not only did not thrive but did not survive the digital transformation of their businesses, [including] Kodak, Border books, Virgin Megastore and the like,” he said.

Late last month Australia Post “launched” its service with the Minister for Communications, Stephen Conroy, and revealed it was being supported by several large companies, including Telstra, AMP, Westpac, ANZ, Bendigo and Adelaide Bank, Link Market Services, NAB and Yarra Valley Water.

Being a government-owned organisation has also allowed Australia Post to partner with the Tax Office and the Department of Human Services, both of which are exploring how to use the service to communicate with citizens about government services.

“This group of mailers that have partnered with Australia Post represents more than 70 per cent of the mail volume for Australia's top 10 mailers,” Mr Fahour said.

DPA disputes Mr Fahour's claim but refuses to say who its partners are or even how many it has signed up.

It claims its joint venture partners Computershare and Salmat BPO (now owned by Fuji Xerox) already store, manage and print more than 75 per cent of all essential mail in Australia.

“Australia Post's sole relationship with that mail is picking it up in pre-sorted boxes and sending it out on trucks for delivery,” the company said.

Mr Dean said email was too insecure for transactional mail and most businesses did not send important documents via email for security and privacy reasons. “Everybody has email but their transactional mail is something they largely get on paper,” he said, adding the digital mailboxes verified both the sender and receiver of mail.

An analyst Guy Cranswick at the research firm IBRS is not convinced. “The digital post box seems like something that would have been innovative 10 years ago,” he said.

Both Australia Post and DPA claim state-of-the-art security, but security experts, including Nigel Phair, warned that there were risks with keeping sensitive documents in the one place.

Mr Phair said it would be a honeypot for identity thieves who could gain access using phishing attacks.

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