Stamps.com To Be Exclusive AOL E-Postage Provider

Online postage provider Stamps.com(Nasdaq: STMP) and America Online (NYSE: AOL) announced a three-year, $56 million (US$) alliance today that will make the Santa Monica, California-based Stamps.com the exclusive provider of Internet postage across AOL’s brands. The deal also calls for AOL to make a multi-million dollar investment in Stamps.com. The exact figure was not disclosed.

Stamps.com said that it plans to develop co-branded sites for each of the AOL properties: AOL, Netscape Netcenter, CompuServe and Digital City. The company also said that it is particularly keen on attracting AOL’s vast pool of small office/home office users, a growing segment of the American workplace and an obvious market for the company’s postage products.

Overnight Delivery

Stamps.com has been mailing out key alliance and marketing deals furiously since it received regulatory approval from the U.S. Postal Service to launch nationwide last August. Like its main competitor, E-Stamp, it had to jump through a number of hoops before receiving the approval.

The August announcement marked the first time in 80 years that the Postal Service has allowed a company to offer a new form of postage.

Since then, Stamps.com has signed major deals with IBM, 3M, Lotus, Microsoft, Intuit and Office Depot.

The company went public in June, raising $55 million in its initial public offering. Early backers include Intel, Vulcan Ventures, GeoCities founder and CEO David Bohnett and former Postmaster General Marvin Runyon. As expected with a company that had yet to generate revenue, Stamps.com posted a $6.1 million loss in the second quarter.

Bulk Mailing

The deal with AOL solidifies Stamps.com’s standing in a market that generates $60 billion annually. The service requires software and a small device that allows a user to download postage and store it to print later.

Rival E-Stamp, which filed for an IPO last month, is backed by Microsoft and AT&T Ventures. While developing its business, the company has been preoccupied with a patent infringement lawsuit filed by Pitney Bowes, the world’s largest postage meter manufacturer.

AOL’s standing as the world’s largest interactive media company was cemented today when the company announced revenues of $1.5 billion for the quarter. AOL also said today that it would invest $800 million in Gateway, the number two computer reseller.

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