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From...
Industry Standard

Is e-mail the killer e-commerce app?

August 10, 1999
Web posted at: 3:37 p.m. EDT (1937 GMT)

by Jackie Cohen

(IDG) -- Of all the things you can do on the Web, e-mail is still far and away the most popular activity. But it's not just for chitchat anymore. Secure e-mail services will have a big impact on the way businesses use couriers, overnight delivery services and even the humble fax machine.

That's why Atlanta-based delivery giant UPS last week invested $4 million in Tumbleweed Software, a secure e-mail service based in Redwood City, Calif. Tumbleweed, which recently went public, sells software that enhances electronic messages with cryptographic security, certified delivery and tracking, graphical capabilities and even customization features.
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"We believe a portion of the overnight mail business will move to electronic media. We want to capture that shift," says Kim Marchner, group manager of UPS Document Exchange. The UPS investment is a powerful proof of concept. For the past year, UPS has licensed Tumbleweed technology for its own branded service, Document Exchange, which helps companies build customized communications environments.

Document Exchange begins pricing at $2.50 for up to 1.4 MB. If you were to print out a letter of that size (20 pages) and overnight it, UPS would charge you $10. But UPS's secure e-mail will deliver the document faster, as well as track delivery and tell you whether the intended recipient has opened the message.

By the year 2001, 35 percent of business documents -- that's 21 million missives per day -- will move across the Internet, says Darcy Fowkes, an analyst at Boston-based Aberdeen Group.

Secure e-mail could be a good medium for a number of heavy-hitting business communications, such as prospectuses, medical records, shareholder communications, accounting forms, statements, proxies and confidential reports.

NASA recently licensed Tumbleweed's technology to automate communications between the aerospace agency and its thousands of suppliers -- from office supplies to engineering equipment. The system will turn proposals, contracts and other forms into encrypted electronic documents and whiz them securely to their destinations.

And the technology appeals to financial companies, as well. Ameritrade now sends about 10 percent of its trade confirmations electronically -- a practice that was legalized by the SEC only within the last two years -- using a secure e-mail technology from PostX.

Financial-service firms are taking to the technology, because it provides speed, security and a chance to cut costs. Chase Manhattan Bank is "sending many millions of dollars in payments and mailing hundreds of files to corporate customers" via secure e-mail, says William F. Tobin, group product manager for Chase in New York City. The bank has spent "millions" on e-mail technologies from Tumbleweed and other vendors.

Meanwhile, the other titan of overnight mail, Federal Express, has no plans to offer e-mail, of any kind. So far, Federal Express has been keener to exploit another piece of the Net revolution: e-commerce fulfillment. FedEx's strategy so far has been to help companies complete orders more efficiently -- from packing up boxes to tracking packages in real time. The company is one of the most popular options for shipment of purchases made on Web sites -- although the company is only beginning to tally its exact numbers in this area.

Federal Express tried to launch a fax product 12 years ago called ZapMail, but, after investing a small fortune in research, FedEx ultimately abandoned the project.

This debacle may be one reason why the company is now so reluctant to explore electronic-messaging systems. According to David J. Roussain, managing director of electronic commerce marketing at FedEx in Collierville, Tenn., the company backed off because it didn't seem lucrative enough.

Neither rain, nor sleet, nor spam, shall stay these couriers...

COMPANY PRODUCT
CertifiedMail.com
Springfield, N.J.
Sends a message to the recipient that gets retrieved from a secure page on the CertifiedMail.com site. Once the recipient receives the message, the sender is notified.
docSpace
Menlo Park, Calif.
This vendor offers Web-based storage and secure e-mail.
Eletter
San Jose, Calif.
Eletter is a postal outsourcing service that targets small and medium-size businesses. It also provides a Web site for preparing mass mailings and having them sent out via snail mail.
PostX
Cupertino, Calif.
The company's secure e-mail can embed transactions in the message.
Tumbleweed
Redwood City, Calif.
Tumbleweed has a secure e-mail platform upon which customers can build customized applications.


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RELATED SITES:
Tumbleweed Communications Corp.
CertifiedMail.com
The docSpace Company
ELetter Inc.
PostX Corp.
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