Avoiding financial armageddon at the United States Post Office
- By Jeff Jordan
- The Atlantic
- October 30, 2012
It's election season. And since Candy Crowley didn't use my question in the second debate, I thought I'd ask it here: "President Obama and Governor Romney, the United States Postal Service is forecasted to lose $5.5 billion in 2012, and also has defaulted on scheduled payments of $11 billion. What would you do to fix it?"
Since the debates are now over, let me take a shot at answering it.
We have a thesis at Andreessen Horowitz that "software is eating the world," such that analog businesses in a wide variety of sectors are being crushed by rapid digitization. In a recent piece, I discussed how this was playing out in retail, where market share gains by online retailers at the expense of offline retailers are threatening the long-term viability of many offline merchants due to their high operating leverage. This same dynamic is playing out in communications. The USPS is an analog business being rapidly consumed by digitization.