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mail to the 9-digit level. * OTA identified one U.S. firm (Recognition Equipment, Inc.) and two foreign firms (Telefunken of Germany, ELSAG of Italy) that have proven multi- line OCRs.

OTA also concluded that USPS has probably underestimated the ultimate operational performance level of multi-line OCRs by 5 to 15 percent. USPS estimated that multi-line OCRs would process 60 percent of 5-digit mail to the 9-digit level. OTA believes that 65 percent is more likely and 75 percent possible.

Feasibility of local and national directories. In order to read, code, and sort S-digit ZIP mail to the 9-digit level, multi-line OCRs require a computerized address directory against which the address information can be compared to ascertain the correct 9-digit ZIP code. They then apply the corresponding barcode, and finally sort the letter.

Until recently, the absence of a local or national directory was a limiting factor for use of multi-line OCRs. However, in the 1981-83 period, USPS completed a national ZIP+4 directory and local ZIP+4 directories for major metropolitan areas. USPS and OTA agree that the conversion of existing local ZIP+4 directories to a multi-line OCR format is technically feasible.

Whereas local directories clearly would be necessary for multi-line OCR operation, OTA was not able to determine whether national directories would offer any significant advantage, particularly when compared to the technical difficulties and likely additional cost.

Feasibility of single-line to multi-line conversion. OTA reviewed the technical feasibility and cost of converting single-line OCRs to multi-line. OTA concluded that conversion would be technically feasible and the USPS estimate of conversion cost -- $200,000 per machine -- is as good as can be developed from available information.

The actual cost of single- to multi-line OCR upgrade can only be determined by detailed engineering analysis and competitive procurement process. It impossible that the conversion could be accomplished by an OCR manufacturer other than the original source, although this might require a high degree of technical cooperation between the

two vendors. Technical opportunities for improved performance.

OTA identified several areas

where technical performance of postal automation might be improved in the future. These include bar-coded reply envelopes, mailer printing of bar codes, improvements in performance of optical character readers, standards for address format, and increased research and development on postal automation.

*

The full address with 5-digit ZIP is read and compared against a computerized address directory that includes 9-digit ZIP codes. If a match is made between the address on the envelope and an address in the directory, the appropriate 9-digit code is applied.

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