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Amazon Strikes Deal With US Postal Service To Deliver Packages On Sundays

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TWC News: Amazon Strikes Deal With US Postal Service To Deliver Packages On Sundays
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Just in time for the holiday shopping rush, the online retail giant Amazon has struck a deal with the U.S. Postal Service to deliver packages on Sundays. Washington bureau reporter Geoff Bennett filed the following report for NY1.

WASHINGTON, D.C. - Call it an early holiday gift for the cash-strapped United States Postal Service.

Amazon, the world's largest Internet retailer, has hired the Postal Service to deliver online orders on Sundays for the first time.

It’s a new source of revenue for the Postal Service, which lost nearly $16 billion last year.

Amazon’s Sunday deliveries start this weekend in New York and Los Angeles, with plans to expand to other cities, including Dallas and Houston, next year.

"It's simply an extension of the normal delivery service," said Brian Fung, a technology reporter with the Washington Post. "You don't have to select a separate shipping option. If you ordered a package on Friday and got two-day delivery, it'll arrive on Sunday."

The postal service has tried to end Saturday mail delivery to cut costs, but package delivery is more profitable.

Although the terms of the deal between Amazon and the Postal Service haven’t been released, its significance is more than financial.

"For one thing, America doesn't have a whole lot of publicly run business," Fung said. "You might have the FDIC or the Corporation for Public Broadcasting, or Amtrak might be a really good example, but in very few cases do we see a private-sector business hiring the government to perform a service.

The postmaster general said that the deal with Amazon is part of wider effort to change the Postal Service’s business model so it can take greater advantage of online shopping and eventually climb out of the red.

"If it does take off, then this could potentially serve as another model for private businesses hiring public companies to do work," Fung said. "It might even encourage other shipping companies like FedEx or UPS to get in on the same game."

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