Wall Street Journal/Orange County Register
By Chris Farnsworth

Garden Grove, Ca, Oct. 26 - Firms that rely heavily on Postal Service to help them communicate are at risk as faxes, e-mail gain more favor.

Godfred Otuteye is installing security cameras and fences at his business. He has removed all but one entrance into each section of the buildings, and conducts background checks on all new job applicants.

Otuteye's business? Direct-mail advertising.

Since the outbreak of anthrax-tainted letters, Otuteye, the chief executive of Money Mailer, has had to take precautions more like the commander of a bank or an Army base. Although Otuteye said there has been no drop-off in business since the first letters hit the news, he wants Money Mailer's deliveries to be as safe as possible.

In addition, Garden Grove-based Money Mailer has stopped accepting samples from manufacturers for mailing.

"We felt it was appropriate to increase security to ensure that the envelopes remain under our control and remain safe," Otuteye said.

But if the anthrax scare continues, Otuteye said, more than direct-mailers are at risk.

"I think that it will be catastrophic for the U.S. economy," he said. "You're talking about people being scared of going to work, being afraid of anthrax in the air they breathe. This is not just mail offices; this is newspapers, Senate offices and big businesses."

Even at Money Mailer, employees in the mail room are wearing gloves. And the fear of receiving mail contaminated with a deadly biological agent has many people looking for other ways to communicate.

The Energy Department sent employees a memo Wednesday encouraging the use of faxes and e-mail because the U.S. Postal Service is discontinuing delivery to the department's Washington headquarters. The agency also isn't accepting overnight delivery of packages.

The Arizona Daily Star, a Tucson newspaper, says it won't take delivery of envelopes containing news releases or letters to the editor. Writers must use faxes or e-mail. It will continue to accept postcards.

Cathy Walbert, a Pittsburgh homemaker, began throwing away unsolicited mail that comes to her house. One envelope arrived the other day with the words "You've been selected" printed on the envelope. "I thought, 'No thank you. Select someone else,' and threw it away," she said.

That sentiment could bring dire consequences for companies that rely on traditional mail to generate business. "If people stop looking at the mail, it isn't going to be just direct-mail companies that suffer," Otuteye said. Even in this wired age, most business still depend on the Postal Service to help them communicate with the public. Now, people who once might have insisted on receiving paper statements of frequent-flier miles and brokerage-account reports will prefer to accept them electronically, said David Kenney, chairman of Digitas Inc., a Boston direct-marketing technology firm. "This will be the push people needed."

Electronic mail is looking increasingly attractive, despite all the worry about computer viruses, privacy and hackers.

EchoMail Inc. a Cambridge, Mass., company that has a contract with the U.S. Senate to sort and reply to e-mails, says it expects to install its software in more than 25 senators' offices over the next 30 days, exceeding the number installed over the past three months.

Worried about anthrax, the Army has canceled Operation Dear Abby, a 17-year-old program in which Americans send letters of support to overseas troops during the holidays. It is considering developing a Web site where people could send supportive e-mails.

Mitch Weiner, president and chief executive of Archer Management Services, a New York company that manages more than 700 mailrooms across the country, says for now it's best for businesses, and even homeowners, to open only crucial mail, such as bills, and put junk or bulk mailings aside. His employees open mail by hand for roughly 65 percent of his clients. He says inquiries are up 30 percent to 40 percent from companies interested in having Archer process their mail, provide consulting or take the mail to another location to be opened.

Anthrax fears may push entire supply chains to link up electronically.

"Customers are going to start demanding that all their suppliers" use electronic documents, said John Redding, spokesman for General Electric Co.'s nuclear-fuel unit. He says GE's electronic document-exchange system "mitigates concern everyone has for handling paper that's been laced with this anthrax."

Other companies are worried about potential liability. Surgical Synergies Inc., a St. Louis chain of outpatient-surgery centers, began requiring its branches to send contracts, leases and other paperwork electronically in light of heightened fear of contamination.

"Having the ability to have an efficient mechanism of transmission free from anthrax seems prudent," said Chairman Michael Ribaudo. Dr. Ribaudo worries his company could be held liable if it unwittingly passed along mail that contained anthrax. "Even if we're not the one responsible for the anthrax, we still have exposure," he said.

Some mailers are turning to tamper-resistant seals and other mechanisms they hope will boost confidence. USA Direct, a York, Pa., mass mailer of business letters, is offering clients a "safety seal" affixed to the flap of the envelope. It advises recipients not to open the package if the seal is broken.

For catalog retailers, many of whom have put the first wave of holiday books into the mail, the anthrax attacks could hardly have come at a more pivotal time. Many say they haven't changed procedures but are monitoring developments. All indications are that anthrax arrives in sealed envelopes, and catalogs aren't usually sealed.

Many say they don't expect consumers to balk at receiving merchandise at home. "We are not sending people anything unsolicited," said Jan Drummond of Sears, Roebuck & Co. "It is clearly marked as coming from Sears."

At Spiegel Group, which sends out Spiegel and Eddie Bauer catalogs, spokeswoman Alison Scherer said the company has talked with vendors about alternatives to a powder lubricant that is used to keep pages from sticking. "Before people were concerned about anthrax, they might never have noticed it," Scherer said.

But with the heightened awareness, consumers notice.

"I can't think of any business that doesn't use the mail to disseminate information," Otuteye said.

Register staff writer Chris Farnsworth contributed to this report.