Delivery Firms Pump $230M Into Wireless

FedEx, UPS, Airborne spend past year hustling for edge in real-time technologies

FedEx Ground's announcement last week that it plans to deploy an $80 million wireless information system is the latest in a series of major investments by the nation's leading package-delivery firms to leverage wireless technology and provide customers with real-time tracking and delivery information.

The fiercely competitive FedEx, United Parcel Service of America Inc. and Airborne Freight Corp. all view their ability to deliver real-time, in-transit and delivery information as a competitive advantage in the New Economy, where delivery personnel are the front-line troops. That helps explain why the Big Three package deliverers have invested a combined $230 million during the past year in various wireless initiatives.

"The reason you want data collection to be wireless is so you can get information [to customers] in real time," said Donald Broughton, an analyst at A. G. Edwards & Sons Inc. in St. Louis. "For shippers, it's not just the speed at which you move their goods from Point A to Point B, but it's also how much real-time data you can provide them on an item."

FedEx Ground in Pittsburgh, which described its $80 million project as the largest nonfacilities investment in the company's history, plans to use the system to provide shippers with more detailed real-time tracking and delivery confirmation information, said Roman Hlutkowsky, the company's managing director of operation technology and support.

To support the effort, FedEx Ground plans to equip its 9,000 drivers with handheld Star II scanners from Symbol Technologies Inc. in Holtsville, N.Y. The scanners will be used to electronically capture delivery information, including signatures, and will transmit data over the wireless network from an in-truck computer.

Atlanta-based UPS is in the midst of rolling out an advanced packet-data network and wireless clipboards to 50,000 of its 60,000 drivers to quickly capture on-the-spot delivery information many shippers now view as essential to conducting e-commerce.

For its part, Seattle-based Airborne has earmarked $50 million - the biggest single technology investment in its history - to provide its drivers with portable terminals that will feature digital signature capture hooked into a nationwide packet-data network.

UPS already transmits 3.2 million packets of information each day over a wireless network operated by Motient Corp. in Reston, Va., while executives at FedEx Ground said they plan to use a packet network provided by Cingular Wireless in Atlanta.

Airborne has also signed a deal with Cingular for interim service until it finalizes a carrier for the network later this year.

UPS and FedEx are at the forefront of deploying wireless technology, while Airborne and DHL Worldwide Express in Redwood City, Calif., are "not at the same level" as the leaders, said John Fontanella, an analyst at AMR Research Inc. in Boston.

Copyright © 2000 IDG Communications, Inc.

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