From teaming up with a rock band to selling restaurant gift cards online, it isn't Ben Franklin's post office any more. The U.S. Postal Service (search) is battling to keep its place in electronic America by going on the Internet.

"We're embracing the Internet and saying, 'Hey, if that's the way 30-year-olds want to do business, then God bless 'em, we're going to do business where they want to do it and how they want to do it," Postmaster General John Potter (search) said Thursday in an interview with The Associated Press.

"We're innovating ... we are trying to change our attitude," Potter said.

As an example, he cited the rock band "Postal Service," formed by two musicians from other groups.

In the past, lawyers would have demanded that the band cease and desist using the agency's name. Instead, Potter said, postal officials listened to the music and reached an agreement to permit use of the postal name.

The 30-and-under population is the group most likely to concentrate on electronic communication, Potter said, and this band is one way to get the postal name in front of them.

Got a last-minute problem getting a gift for any occasion? The post office is there to help, Potter said.

"You can go online with us, produce a card for anyone. If you want to include a gift card ... the gift card's right there," he said.

Offerings cover a variety of prices and include a restaurant card that can be used at any restaurant that accepts American Express. Also, specific gift cards can apply to places such as Barnes & Noble bookstores, Romano's Macaroni Grill, Safeway and Vons supermarkets, Lowe's hardware, Chili's, Bed, Bath & Beyond and Starbucks coffee.

Another service allows people to avoid going to the post office to ship their packages.

"You can click and ship," Potter said. "You can produce a label ... there is an automatic calculation of postage by weight ... you can tell us that you have that package. If you want immediate pickup you can pay $12.50 and a carrier will come out to pick it up. If it can wait until tomorrow, the carrier is coming by your door, tell us that you have it and on the route they'll just pick it up," Potter said.

Potter said the agency is working with what he called e-tailers (search), which sell through the Internet. Studies have shown that people buy more if they have a catalog to look at instead of just the Internet, he said, "so people who you might never think would have a catalog in the mail do," such as major computer companies and even the online auction site e-Bay.

Potter said he is also looking at ways to cooperate with what are sometimes seen as competitors in the battle for the advertising dollar.

Ad supplements carried in newspapers are one example, he said, with the post office delivering mailed supplements to addresses that do not subscribe to a paper.

In the interview, Potter also said:

—The post office will keep its promise not to raise rates before 2006. Because it takes nearly a year to put an increase in place, that means the postal service will probably began the process in the spring, perhaps in April. A phased increase is a possibility.

—He is hopeful that Congress will be able to pass legislation to give the agency more flexibility in how it operates. Bills won approval in House and Senate committees this year but stalled.

—The amount of the planned rate increase will depend on whether that legislation removes the requirement for the post office to place funds in escrow in 2006, tying up $2.9 billion.

—First-class mail has been declining while advertising mail increases, a change that alters the finances of the agency. Diversion of bills and payments to the Internet has been part of the problem, and some first-class items have been switched to standard rates.

—The post office is working on installation of sensors to protect workers and the public against anthrax and other biological threats.

The post office will not abandon universal service but would like some flexibility in closing smaller offices, many of which serve fewer than 100 people.