MTAC Update Mailing Industry Area Focus Group Meeting March 2015

Slide 2 Postmaster General’s Mailers Technical Advisory Committee An association of associations  Representatives of the industry – not companies  Currently Over 50 Associations have an MTAC membership One Association Executive and up to Three Association Representatives per Association Approximately175 Association Executives and Representatives Focused on sharing information between the USPS and Mailing  The Postmaster General’s Mailers’ Technical Advisory Committee (MTAC) is a venue for the United States Postal Service (“Postal Service”) to share technical information with mailers, and to receive their advice and recommendations on matters concerning mail-related products and services, in order to enhance customer value and expand the use of these products and services for the mutual benefit of Mailing Industry stakeholders and the Postal Service Focus Areas – defined by PMG  First-Class Mail  Periodicals  Standard Mail  Package Services  Preparation and Entry  Visibility/Service Performance and Address Quality  Mail Piece Design and Product Development  Payment and Acceptance

Slide 3 MTAC Executive Committee Members – Updated IndustryU. S. Postal Service Christopher G. Lien -- Industry Chair ( ) BCC Software Cell: Jim Nemec -- Postal Chair Vice President, Consumer & Industry Affairs 475 L'Enfant Plaza RM 4016 Washington DC Erv Drewek-- Industry Vice Chair & Treasurer ( ) Manager of Postal Affairs Graphic Communications, a Veritiv company 5700 Darrow Road, Suite 110 Hudson, OH, Cell: Judy de Torok -- Postal Co-Vice Chair Manager, Industry Engagement & Outreach Consumer & Industry Affairs 475 L'Enfant Plaza SW RM 4437 Washington DC Phil Thompson -- Immediate Past Industry Chair ( ) Manager of Postal Operations Quad/Graphics Inc N61 W23044 Harry's Way Sussex WI Dale Kennedy -- Postal Co-Vice Chair Manager, Business Customer Support & Service 475 L'Enfant Plaza SW RM 4541 Washington DC May Frantz – MTAC Program Manager Manager, Industry Engagement Strategy Consumer & Industry Affairs 475 L'Enfant Plaza SW Washington DC

Slide 4 MTAC Industry Leadership (2014 to 2015) Industry Leaders: Classes of MailIndustry Leaders: Focus Areas Sharon Harrison / First-Class Mail / Major Mailers Association AT&T Services Inc: VP, Postal Strategy Finance 3900 Channel Dr West Sacramento CA Angelo Anagnostopoulos / Payment / Edison Electric Institute GrayHair Software Inc: VP Postal Affairs 124 Gaither Dr Ste 160 Mt Laurel NJ John Medeiros / Package Services / Parcel Shippers Association DHL Global Mail: Director, Postal Affairs 7415 Emerald Dunes Drive. Ste 600 Orlando FL Lisa Bowes / Service Performance Informed Vis/Addressing Natl Alliance of Standard Mailers & Logistics Intelisent: Manager, Account Services & Postal Affairs 597 North Mountain Road Newington CT Wanda Senne / Standard Mail / Natl Assn of Advertising Distributors World Marketing:Vice President, Postal Affairs 1961 S Cobb Industrial Blvd Smyrna GA Bob Schimek / Preparation & Entry (Operations) / IDEAlliance Satori Software: Senior Director - Postal Affairs th Ave Ste Seattle WA John Stark / Periodicals / IDEAlliance Condé Nast: Executive Director of Distribution Operations 1166 Avenue of the Americas 19th Fl New York NY Steve Colella / Mailpiece Design & Product Development / Association of Marketing Service Providers (AMSP) The Calmark Group: VP- Postal Affairs 6755 S. Sayre Ave Bedford Park, IL

Slide 5 MTAC U.S. Postal Service Leadership - Updated USPS Focus Area Leaders Visibility & Service Performance Measurement Robert Cintron VP, Product Information U.S. Postal Service 475 L'Enfant Plaza SW Washington DC (202) Payment and Acceptance Pritha Mehra VP, Mail Entry & Payment Technology U.S. Postal Service 475 L'Enfant Plaza SW Washington DC (202) Product Development Gary Reblin VP, New Products and Innovation U.S. Postal Service 475 L'Enfant Plaza SW Washington DC (202) Mail Preparation & Entry / Operations Linda Malone VP, Network Operations U.S. Postal Service 475 L'Enfant Plaza SW Washington DC (202)

Slide 6 MTAC Meetings: Policy Meetings are quarterly and generally held at USPS Headquarters  MTAC members are required to attend. Substitutes are not allowed. Approved Industry experts can attend as guests  Each association is permitted a maximum of three guests per year  The Association Executive must formerly sponsor the guest  The MTAC Executive Committee must approve all guests  MTAC Leadership (Focus Area leaders, Executive Committee, and Ex Officials) may sponsor a guest. However: The guest should be an industry expert representing a part of the industry that is not currently being represented by an existing MTAC Association Becoming an MTAC Member:  Check the MTAC Roster posted on ribbs.usps.govribbs.usps.gov  Contact the Association Executive of an association to which your employer belongs and find out how the association selects their representative for MTAC

Slide 7 MTAC Meetings: Typical Format Tuesday Morning – MTAC Committee Meetings  Face-to-face meetings at USPS Headquarters for some committees Tuesday Afternoon MTAC General Session – Open  General overview of USPS finances, operations, and other areas  A 5 to 10 minute update on open workgroups, user groups, and task teams.  An evening reception typically follows the Tuesday meeting Wednesday All Day Focus Group Meetings – Closed  MTAC General Assembly (announcements; recognize new members)  75 minute discussions per Focus Group, led by USPS and industry Focus Area Leaders  MTAC Business Meeting for current MTAC industry members only Thursday Morning – Workgroup Sessions & Meetings  Face-to-face meetings at USPS Headquarters  MTAC Leadership and Executive Committee meetings

Slide 8 MTAC (FCM) – Focus Agendas & Topics 02/18/15 USPSLinda Malone Robert CitronPritha MehraGary Reblin IndustryBob Schimek / Sharon Harrison Lisa Bowes / Sharon Harrison (Request Pritha Mehra Rep Present) Angelo Anagnostopoulos / Sharon (Request Robert Cintron Rep Present) Steve Colella / Sharon Harrison Track: Prep/NetworksVisibility/ Service/AddressingPayment/AcceptanceProduct Development Introductions Overview by USPS Leadership on Focus Area and FCM Impacts Discuss FCM Issues / Resolution  Recap last meeting/action items  Network Rationalization Latest Communication to end customers CSA updates Removing overnight service on maps What are the areas impacted w/ operations/transportation? Alignment w/impacts Remittance impacts  New impacts for Remittance mail?  Who is HQ Remittance contact?  New CSA/DMM rules?  Label list status – 5D impacts  Customer Help Desk status  Others? Discuss FCM Issues/Resolution Service Visibility:  Recap last meeting/ action items MTAC UG Status on measurement – gaps to visibility USPS edoc without mail scan Consolidated Facility File  Service Performance for FCM Addressing:  UAA Secured Destruction status/ ideas on promotion to customers  FPARS/UAA Secured Destruction?  Single Source ACS Release status  FRN Address Quality Measurement Alternative  UAA Reason Code approach  Others? Discuss FCM Issues / Resolution:  Recap last meeting/ action items USPS Pricing /500 piece rule, presort marks, meter date, etc. Status on palletization changes/communication.  Seamless invoicing concerns Quality, undocumented status and, timing  Postage appeal process details  FRN/Response on Address Quality Measurement Alternative  Customer Help Desk status  Customer Pulse status  Others? Discuss FCM Issues / Resolution:  Recap of last meeting action items  Earned value reporting data – will mailers be able to get this data?  FCM Billing study – any news?  Review of Promotions (including Business Rules for 2015)  Review any new registration changes  Begin dialogue on 2016 promotions  UAA Secured Destruction Promotion – how to get this supported?  Single Piece rates – what is the approach?  Certificate of Mailing (COM) changes?  Other Innovation Topics  Others? Recap/ Action Items / Notes: Recap/ Action Items/ Notes: Recap/ Action Items / Notes:

Slide 9 MTAC 50 Years Ago

Slide 10 Meeting Schedule for 2015: Election Year February 17 – 19  PMG Megan Brennan Tuesday afternoon May 20  Meeting held at the National Postal Forum in Anaheim, CA  Special MTAC recognition and reception  Compressed schedule with all classes meeting together for each one- hour focus meeting (2:00 to 5:00)  Vice-Chair candidates announced August 11 – 13  MTAC 50 th Anniversary Celebration  Vice-chair (2016 – 2017) elections at the MTAC Business Meeting  Nominations for MTAC Leadership (2016 – 2017) are opened November 17 – 19  MTAC Leadership (2016 – 2017) elections at the MTAC Business Meeting

Slide 11 Types of Committees Group Type Intended Function Primary Sponsor / Oversight Group Participants Approval of Participants Timeframe User Group Ongoing forum for USPS & users of a particular postal product or process. MTAC Focus Area Leader (postal and/or industry) Subject Matter Experts (both USPS and industry) User Group Leaders Open - No specific end date. Annual review of issue statement in August by the MTAC EC. Work Group Address defined issues, and provide recommendations MTAC Focus Area Leader (postal and/or industry) Primarily MTAC Members and industry experts MTAC Focus Area Leader Concludes when recommendations are submitted for consideration (per the issue statement) Task Team Quickly address very specific issue to achieve results in a strict, often urgent period of time. MTAC Executive Committee (may also be delegated to Focus Area Leader if subject is specific to an Area) Specifically selected by MTAC Leadership and Executive Committee MTAC Executive Committee Concludes when task or problem resolution is completed (per the issue statement)

Slide 12 User Group # 1 – Submitted June 2010 User Group TitlePostalOne!, SASP, Intelligent Mail User Group OriginatorPritha Mehra Originator AssociationUnited States Postal Service USPS SponsorCharles Pruitt Leadership Committee SponsorRFlanagan AngeloA User Group Mission StatementThe mission of the PostalOne!, SASP, Intelligent Mail User Group will be to address and resolve issues identified and to define and review improvements in functionality across the PostalOne!, SASP and Intelligent Mail systems. The User Group will create ad hoc subgroups to address specific issues as necessary. Impact on Other Issues or Procedures1. Business Mail Acceptance - current acceptance and verification processes.2. Mailing Standards and Preparation - current regulation assessment and development of new requirements.3. USPS Mail Processing Operations - current preparation to processing assessment, business process integrity, data collection/management and exception reporting.4. Mail Service Providers and Mail Owners Desired ResultsThe PostalOne!, SASP, Intelligent Mail User Group will become the formal vehicle for the cross-exchange of technical systems information to ensure the industry and Postal Service work together throughout the lifecycle of software deployments. Industry User Group LeadersSKrejcik LGustason AssociationNot applicable USPS User Group LeadersKMackey UNan-Horton AssociationUnited States Postal Service Latest User Group News Resolution

Slide 13 Current User Groups User Group 1 - PostalOne!, SASP, Intelligent Ma il  Mission: address and resolve issues identified and to define and review improvements in functionality across the PostalOne!, SASP and Intelligent Mail systems User Group 2 - eVS/Product Tracking System  Mission: to address and resolve issues identified and to define and review improvements in functionality across the eVS and Product Tracking System (PTS). User Group 3 - FAST User Group  Mission: resolve issues identified and to define and review improvements in functionality across the FAST and eInduction systems. User Group 4 – Visibility (CONFIRM)  Mission: To provide an ongoing forum for the Postal Service and users of the CONFIRM program to facilitate communications and address and resolve issues pertaining to the CONFIRM program. User Group 5 – Addressing  Mission: Pursuit of excellence in Addressing and application of address information. Support the 3 C’s (Correct/Complete/Current) User Group 7 – MTEOR (Mail Transport Equipment Ordering System)  Mission: Continuous improvement regarding supply logistics User Group 8 – USPS Promotions  Mission: Industry & USPS working together to discuss new promotions and implementation User Group 9 – Labeling Lists and Data Distribution  Mission: Create and discuss the efficient communication, deployment, and accuracy of USPS presort reference data.

Slide 14 Current Workgroups New MTAC Workgroups  Workgroup 167 – Solutions for Pieces Excluded from Service Measurement  Workgroup 168 – FSS Multi-scheme Pallets  Workgroup 169 – Refining Machinability Standards (Parcels, Flats, Letters) Two years of study for each mail piece type starting with parcels, then flats, and finally letters  Workgroup 170: Certificate of Mailing (COM) Improvements Workgroups Concluded in February  138 – eInduction  162 – Multiple Periodicals in a Wrapper (Polywrap)  163 – Third Party Reporting and Invoicing  164 – Informed Visibility Data Provisioning Improvements  165 – Improve MDA Support Process Workgroups scheduled to conclude by May 2015 meeting  143 – Seamless Acceptance  159 – Evaluation/Recommendation entering product at Hubs Pilot in progress; expected to conclude April 2015 Concluding April 2015  151 – Streamlined Weight and Ad Capture Process  166 – IMpb Compliance for Shipping Services File Timeliness

Slide 15 Current Task Teams Task Team 22 – MTAC 50th Anniversary Event Planning (2015)  Immediately after MTAC meetings or as needed Task Team 23 – Readiness for Trend Based Verification  Reports directly to the MTAC Executive Committee  Launched January 23, 2015  Focus will be on four key industry concerns related to essential areas such as seamless acceptance, eInduction, Move Update, and Full Service Intelligent Mail barcodes Validate Data Quality across Key Reports and Invoices Validate stability of systems via published metrics Validate data attribution methodology Transparency of thresholds used to determine compliance  Four USPS and four industry experts representing all classes of mail across the entire mail supply chain  Schedule concluding date is March 31, 2015

Slide 16 Work Group #1 Submitted in 1997 Work Group TitleEliminate barriers to 100% DeliveryPoint Barcoding Work Group OriginatorRobert Obrien Originator AssociationAgricultural Publishers Assoc. USPS Sponsor Leadership Committee SponsorPeter Moore Work Group Mission StatementClassification Reform has created a need for mailers to prepare 100% DPBC mailings in order to optimize postage savings. The software "tools" and feedback processes that exist today are nto adequate for virtually any mailer to attain 100% DPBC. Impact on Other Issues or Procedures Desired ResultsWork with industry and Postal Service to eliminate all barriers to 100% DPBC. Industry Work Group LeadersRobert Obrien AssociationAgricultural Publishers Assoc. USPS Work Group LeadersWayne Orbke AssociationUnited States Postal Service Latest Work Group News10/2/97 - This issue has been rolled into the more inclusive issue 16, Address Coding Enhancement.(WG 16) Resolution Mailers' Technical Advisory Committee Issue Identification Form

Slide 17 Task Team #1 – Electronic Interchange Submitted June 2010 Task Team TitleElectronic Interchange Task Team OriginatorPritha Mehra Originator AssociationUnited States Postal Service USPS SponsorMTAC Executive Committee Leadership Committee Sponsor MTAC Executive Committee Task Team Mission Statement The task team will outline communications strategies for system changes to ensure the industry and Postal Service work together throughout the lifecycle of software deployments. It will recommend key activities and communications channels that are critical to an effective software deployment lifecycle process. The task team will work with the members of the below mentioned user groups to achieve their objectives. Impact on Other Issues or Procedures 1. Business Mail Acceptance - current acceptance and verification process.2. Mailing Standards and Preparation - current regulation assessment and development of new requirements.3. USPS Mail Processing Operations - current preparation to processing assessment.4. Mail Service Providers and Mail Owners. Desired ResultsTo develop the structure and operating guidelines for the following three user groups focused on addressing issues and improvements in the electronic interactions between the Postal Service and Mailing Industry related to key postal information systems.1. PostalOne!/SASP/Intelligent Mail2. FAST3. eVS/PTS Industry Task Team LeadersLisa WurmanAssociationNot applicable USPS Task Team LeadersBrenda WashingtonAssociationUnited States Postal Service Latest Task Team News ResolutionResolution Statement: Task Team # 1 "Electronic Interchange" has completed its task. The Team was led by Brenda Washington for the USPS and Lisa Wurman for the Industry. Participants were the User Group Leaders for MTAC User Groups # 1, # 2 and # 3. These three user groups are now "up and running." No follow up recommendations for the Resolution Issue Tracking System (RITS) were deemed necessary.

Slide 18 Recent and Planned MTAC Related Webinars Mail Prep And Entry Focus Session (February 5, 2015)  For MTAC members in preparation for MTAC Focus Meetings USPS Proposed Pricing Overview (February 3, 2015) IMpb Requirements for January 2015 (January 7, 2015) Visibility on Mail in Delivery Units (January 9, 2015) Mail Entry Roadmap Webinar (December 1, 2014) Secure Destruction - A Primer for Mailers (November 13, 2014) IMpb Compliance (October 14, 2014) IMpb Impacts on Extra Services (October 2, 2014) Fall Mailing Season (August 18, 2014) Network Rationalization Phase II (August 15, 2014) Found At:

Slide 19 Topics Discussed at the February 2015 Meeting FSS sortation changes and proposed pricing impact  Unintended consequences of pricing proposal for FSS mail for HD and HD+ are prompting an immediate review by MTAC Leadership Lack of visibility that mail entered at the Hub would get DSCF discounts  Mailers need something documented that clearly shows the DSCF eligibility for mail entered at Hubs, such as updating the DMM New mailing standards for lithium batteries  Final notice posted with a March 2, 2015 required date Adhesive Tray Labels to Improve Container Scans  Considering using adhesive labels versus tag stock  Could enable automated label application and reduce costs Mail Preparation and Entry

Slide 20 Topics Discussed at the February 2015 Meeting 86% of all mail is Full Service IMb Compliant Mail Entry Roadmap updated on RIBBS  Many proposed dates have been moved out including Full Service electronic verification and Seamless now proposed for July 2015 New Move Update compliance extended  Won’t occur until the next price change  Less than 0.5% of the 5,805 eDoc submitters (75% FS IMb) are below the 0.8% threshold proposed for census-based Move Update Container Scans are Missing  USPS believes the Original Container Indicator (OCI) reported in eDoc is not getting scanned with physical containers likely due to container “jackpotting” Copalletization of smaller pallets resulting in missed OCI scans Payment and Acceptance

Slide 21 Full Service IMb by Mail Class

Slide 22 January 2015 Full-Service Compliance Scores Full-Service Verifications ThresholdNational % in Error STID -Piece2%0.17% MID - Container2%0.01% MID - Handling Unit2%0.65% MID - Piece2%0.03% Barcode Uniqueness - Container 2%1.04% Barcode Uniqueness - Handling Unit 2%0.29% Barcode Uniqueness - Piece 2%2.47% Entry Facility - Container 5%0.00% Entry Facility - Handling Unit 5%0.00% By/For - Piece5%7.84% OCI5%TBD BME/BMS contacting all mailers over a full- service threshold Working with mailers to explain full-service requirements and help understand and resolve the issues BMS working with mailers who need customized by/for threshold

Slide 23 Topics Discussed at the February 2015 Meeting Service Performance  Service delays since January 5, 2015 are being addressed and industry should see improvements soon Visibility  Looking into bundle scans using IMb as well as facing slips Addressing  Simplification of the carrier provided UAA Reason Codes MTAC Workgroup is being prepared and should be announced soon Manual Address Correction – Considering Optional  Looking into possibly making Periodical manual address corrections optional and may make this an MTAC Workgroup Addressing and Service Performance & Measurement

Slide 24 Topics Discussed at the February 2015 Meeting Reviewed Results of the 2014 Promotions Reviewed Business Rules for 2015 Promotions All stamps to be Pressure Sensitive Stamps  Water activated formats to be discontinued due to overseas procurement of the paper Certificate of Mailing Proposal  Proposal to transition away from a round-dated mailing receipt to an IMpb approach that leverages scanned data Federal Register Notice posted 2/5/2015 with a July 26, 2015 effective date  Industry (especially First-Class financial and insurance mailers) expressed significant concerns regarding this aggressive timeline  An MTAC Workgroup is being formed to quickly identify the concerns and present a proposed phased approach Product Development

Slide 25 Promotions by the numbers… 2014 Promotions Results FY 2014 Promotions (7 promotions) generated: 7.8B mailpieces $1.8B in revenue 1,487 participating customers Over $48M in discounts received by participating customers =

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Slide 27 APPENDIX ns/opensessions/ Opening Session Material and User/Workgroup and Task Team Updates February Operations Update - David Williams, Chief Operating Officer & EVP February Q1 FY2015 Financials - Joe Corbett, Chief Financial Officer & EVP February Mail Entry Update - Pritha Mehra, VP Mail Entry & Payment Technology February Proposed 2015 Promotions and Innovations - Gary Reblin, VP New Products & Innovations February Proposed 2015 Promotions and Innovations - Gary Reblin, VP New Products & Innovations February Teams/User Groups Updates - Chris Lien, MTAC Industry Chair February New MTAC Work Groups - Chris Lien, MTAC Industry Chair February Transition of Stamp formats from WAG to PSA - Khalid Hussain, Manager of Stamp Fulfillment Services February Transition of Stamp formats from WAG to PSA - Khalid Hussain, Manager of Stamp Fulfillment Services otes/Feb2015/ Notes from the four Focus Group Sessions Mail Prep and Entry (Operations) Mail Acceptance and Payment Product Development Visibility/Service Performance Measurement

Questions? Interim MTAC Update 2015 status and inquiries should be directed to: Consumer & Industry Affairs / Industry Engagement & Outreach