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Billie the dog walks along with about 2,000 people march through the streets in support of the Canadian Union of Postal Workers, who rallied outside Prime Minister Stephen Harper's office below Parliament Hill in Ottawa, Sunday January 26 2014. They were protesting against Canada Post's cuts of door-to-door mail delivery. (FRED CHARTRAND/THE CANADIAN PRESS)
Billie the dog walks along with about 2,000 people march through the streets in support of the Canadian Union of Postal Workers, who rallied outside Prime Minister Stephen Harper's office below Parliament Hill in Ottawa, Sunday January 26 2014. They were protesting against Canada Post's cuts of door-to-door mail delivery. (FRED CHARTRAND/THE CANADIAN PRESS)

Canada Post will phase out home delivery in smaller cities and suburbs first Add to ...

Canada Post will initially avoid densely populated urban neighbourhoods as it begins the phase out of door-to-door delivery to roughly five million Canadian homes.

Facing a backlash from many urban mayors, the postal service said Wednesday that the first areas to be shifted to centralized community mail boxes will be in the suburbs.

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“Canada Post recognizes that dense urban cores in our larger cities, with older neighbourhoods and smaller lots, present different challenges for locating community mailboxes than suburban areas,” the federal Crown Corporation said in a statement.

The first areas to lose service will be announced in the next two weeks and conversion will likely take place in September or October, said Mary Traversy, senior vice-president of business transformation. She said “at least several thousand” households will be affected this year.

“We wanted to reassure Canadians and municipal leaders that we are going to work closely with municipalities on the placement of community mail boxes,” she added.

“We are going to start in suburban areas – areas where we already have community mail boxes.”

Dense city centres will be converted last.

Retailers, including drug store chains, have expressed interest in installing community boxes as a way to drive traffic, according to Ms. Traversy. The post office is also looking at redesigning its boxes so they can be installed on the walls of commercial buildings, rather in the ground, or near coffee shops and convenience stores.

Canada Post may also have to offer compensation to businesses at some locations, she said.

Facing a steady drop in letter volumes and mounting financial losses, Canada Post announced in December that it was ending door-to-door delivery over the next five years. It also plans to raise the price of stamps to 85 cents from 63 cents on March 31, cut 6,000 to 8,000 jobs and franchise more postal stations.

But it’s the end of home delivery that has stirred the most controversy, angering seniors and many urban mayors. Ottawa mayor Jim Watson, for example, has raised concerns about where the boxes will go, whether cities will be paid for taking the boxes and about garbage around sites.

The post office currently delivers mail and parcels to 15.3 million households and businesses. A third of those, or 5.1 million, that now get door-to-door delivery, will lose the service over the next five years. The rest of Canadians get their mail either at group mailboxes, apartment lobby boxes, post offices or on rural roads, and they will be unaffected.

Canada Post said the “vast majority” of business will continue to get delivery of mail and parcels to their doors, particularly those on main streets and large-volume customers.

Canada Post also said it is developing “alternative approaches” to get mail to seniors and the disabled who have “mobility challenges.”

Canada Post chief executive Deepak Chopra caused a stir in December when he awkwardly suggested ending home delivery would encourage seniors to get more exercise. “The seniors are telling me, ‘I want to be healthy. I want to be active in my life,’” he said.

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