Postcomm tries simple solution to market domination (UK)

While Postcomm’s measures to simplify its licensing procedures to make it easier for smaller businesses to enter the postal market might be encouraging, is it enough to increase competition in, what many still consider, a monopolised market? Or is Postcomm simply going through the motions?

The independent regulator has amended its licensing procedures to include a reduction in application fees and the removal of the licence requirement on all licensees to have contractual arrangements in place. The move is designed to encourage smaller businesses to enter the market (precisionmarketing.co.uk).

Post-Switch’s senior marketing analyst Jonathan DeCarteret says: “Royal Mail continues to deliver 99 per cent of all mail, so by simplifying licensing and removing the obstacles for smaller operators, it is trying to attract competition and promote self regulation. All of which offers small and medium businesses greater choice and lower rates.”

But OnePost managing director Graham Cooper claims simplifying the licensing procedure alone will not be enough. He states: “This loosening of the requirements for those wishing to obtain a licence is a direct move by Postcomm to assist in further development of the market. Although there have been many enquiries from small businesses about entering the postal market, the numbers of licence holders remain at less than 20.”

He believes the review of the Postal Sector announced by Department for Business, Enterprise & Regulatory Reform (DBERR) at the end of last year is vital to the future of the direct marketing industry and sets out to assess the impact of liberalisation in the UK postal market.

Whether the move will attract new players into the market, remains to be seen, but anything that injects money into direct marketing can only be positive.

While Postcomm’s measures to simplify its licensing procedures to make it easier for smaller businesses to enter the postal market might be encouraging, is it enough to increase competition in, what many still consider, a monopolised market? Or is Postcomm simply going through the motions?

The independent regulator has amended its licensing procedures to include a reduction in application fees and the removal of the licence requirement on all licensees to have contractual arrangements in place. The move is designed to encourage smaller businesses to enter the market (precisionmarketing.co.uk).

Post-Switch’s senior marketing analyst Jonathan DeCarteret says: “Royal Mail continues to deliver 99 per cent of all mail, so by simplifying licensing and removing the obstacles for smaller operators, it is trying to attract competition and promote self regulation. All of which offers small and medium businesses greater choice and lower rates.”

But OnePost managing director Graham Cooper claims simplifying the licensing procedure alone will not be enough. He states: “This loosening of the requirements for those wishing to obtain a licence is a direct move by Postcomm to assist in further development of the market. Although there have been many enquiries from small businesses about entering the postal market, the numbers of licence holders remain at less than 20.”

He believes the review of the Postal Sector announced by Department for Business, Enterprise & Regulatory Reform (DBERR) at the end of last year is vital to the future of the direct marketing industry and sets out to assess the impact of liberalisation in the UK postal market.

“If, following the review, we get a satisfactory and clearly articulated plan for the future, including a sharper definition of Postcomm’s role, measures such as the introduction of revised arrangements for licensing and the recent announcement of a consultation on Access, will have a much more significant role in a competitive postal market.”

Whether the move will attract new players into the market, remains to be seen, but anything that injects money into direct marketing can only be positive.