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Deutsche Post cancels HP outsourcing deal

Posted by | Aug 1, 2008 | |

Deutsche Post World Net has backed out of a planned IT outsourcing megadeal with Hewlett-Packard worth billions of dollars, InformationWeek has learned.

Deutsche Post, the German logistics company and parent to DHL, chose not to finalize the contract after a six-month review found the “benefits, particularly in the early years, do not outweigh the risks,” according to an internal memo.

The dropped outsourcing deal called for HP to hire 2,500 Deutsche Post employees, including those working for DHL. It included taking over the operations and management of data, infrastructure, networks, and software running in data centers in Scottsdale, Ariz.; Prague, the Czech Republic; Malaysia; and other regions.

Although the companies didn’t make the contract size public in January, when they announced the signing of a letter of intent, they said Deutsche Post would save at least 1 billion euros over seven years by outsourcing IT and expected to reach a “definitive agreement” with HP by the middle of 2008.

In a July 21 e-mail to employees, Stephen McGuckin, IT Services Managing Director at Deutsche Post, wrote that the deal had fallen through partly because it wasn’t going to bring Deutsche Post the expected savings.

During the past six months, “both companies have learnt much about the challenges, risks and benefits of the proposed outsourcing. More significantly [Deutsche Post] IT Services continued to improve its cost position, increased the number of services delivered while also maintaining service levels. Simply put, during the six months of the evaluation, our improving cost position made HP’s job that much harder and their cost reduction target that much more difficult to achieve.”

McGuckin added that the decision is “not a reflection of HP’s merits as a service provider; it is a vote of confidence in [Deutsche Post] IT Services and our track record of service delivery.”

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Financial investor bids over EUR 500m for Seur controlling stake

Posted by | Aug 1, 2008 | |

British private equity company Doughty Hanson has bid more than EUR 500 million to buy a 52 pct majority stake in Spanish express parcels operator Seur in an offer valuing the company at about EUR 1 billion. DHL and UPS were apparently also interested in the company.
According to Spanish business newspaper Expansión, the UK financial investor has made the offer to a group of Seur franchisees who have decided to sell off their shareholdings in the group. The offer, valuing the whole company at EUR 1 billion, is thus worth about EUR 520 million.
Expansión, citing market sources, described the bid as “friendly” and said that Doughty Hanson was ready to work with other Seur shareholders, including La Poste subsidiary GeoPost, which owns a 19.6 pct share in the group.
The other Seur shareholders now have 45 days to decide whether to exercise their right to block the bid with a counter-offer of at least the same size, the newspaper wrote. Sources close to La Poste said that no decision has yet been taken about this, it added.
Seur, with revenues of EUR 665 million last year, has a complex, decentralised ownership structure comprising regional franchisees who also own small stakes in the parent company Seur SA. Seur has 85 franchisees in total controlled by 54 companies. The franchisees seeking to sell their holdings represent 52 pct of Seur capital, 65 pct of the franchises by number, and generate 5 pct of gross profits, according to the newspaper.

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UNI encourages UPU to do more for sustainable development

Posted by | Aug 1, 2008 | |

Speaking at the UPU Congress debate on sustainable development, Head of UNI Post & Logistics Global Union, Neil Anderson, encouraged the delegates to become more active in the work of the UPU on sustainable development. He said UNI was pleased to have been part of the social dialogue activities that had been run in Africa and Europe and was hoping to encourage other regions to be part of the dialogue. As a member of the UPU Consultative Committee UNI Global Union was also wanting the issue of social inclusion and workers rights to be part of that committee’s agenda and would be working to include the new operators in that work. He said that to date the Postal Sector has an excellent history of being socially responsible and UNI wanted to encourage all UPU members and Consultative Committee members to continue that tradition and work to ensuring that all postal workers enjoyed workers rights.

The Rapporteur for the sustainable development agenda item, Patrick Widloecher from France, speaking after UNI, told delegates that he totally agreed with UNI and that post had to be socially responsible and respect the rights and aims of workers to be involved in the development of their industry. He said that postal administrations must recognise that workers were an integral part of the industry and must be consulted and included in the changes that the industry was facing particularly in respect of climate change. He said they were citizens and consumers also and if Posts wanted to have a workforce committed to making positive change they must be included in and be part of that change.

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Postal Service wants limits on its universal service obligation (U.S)

Posted by | Jul 31, 2008 | |

The U.S. Postal Service wants to exempt its competitive products (like Priority Mail and package services) from the universal service obligation. Doing so would allow it to cut back on offerings in sparsely populated areas where business is thin.

The Postal Service argues that those services shouldn’t be treated differently than those of competitors such as FedEx, DHL and UPS. An exemption would allow the Postal Service to choose which competitive products it offers in a given market, and what standards of service to apply. Products covered by the universal service obligation such as first-class mail, must be offered in a uniform fashion across the country.
But even if the agency gets approval from Congress to exempt those competitive services from universal service, an international treaty would create a paradox: The Postal Service would still be required to deliver mail and packages coming into the United States from overseas, even if it doesn’t offer the products in a given market.

The Postal Service made its request for the exemption in a lengthy set of comments submitted to the Postal Regulatory Commission last week. PRC has also solicited public comment on the universal service obligation; the commission will submit a final report to Congress in December.

Under the 2006 Postal Accountability and Enhancement Act, postal products were divided into two categories: market-dominant and competitive. Products in the former group (like first-class mail) are covered by the universal service obligation because the Postal Service has a monopoly over their delivery. But the latter group competes with products offered by commercial shippers like UPS and FedEx.

An exemption for the competitive products would be just one step toward restoring profitability at the financially troubled Postal Service. The agency posted a USD 706 million loss in the second quarter of 2008; decreasing mail volume and increasing fuel costs have squeezed its bottom line. And, the Postal Service can’t rely on market-dominant products to reverse that trend: Price increases for those products are capped at the rate of inflation.

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Schuetze new sales MD for TNT Express Germany

Posted by | Jul 31, 2008 | |

TNT Express Germany has appointed experienced Marketing and Sales Manager Dr Roland Schuetze as its Managing Director Sales, Marketing and Customer Service, with effect from 1 August. He comes from the Weidmueller group, one of the world’s leading providers of connecting elements for data, signals and energy, where he was responsible for global sales. Prior to this, Schuetze was senior vice-president sales and a member of the board of Lufthansa Cargo. In that position he was responsible for global key account management, global customer service and margin management.

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UPU adopts new four-year roadmap

Posted by | Jul 31, 2008 | |

UPU member countries unanimously adopted a new four-year roadmap for the worldwide postal sector during yesterday’s (30th July) plenary session of the 24th Universal Postal Congress.

Jean-Luc Dutordoit, from the Belgian delegation, presenting the new world postal strategy to delegates of the 24th Universal Postal Congress in Geneva.

The strategy comprises four objectives that the government of UPU member countries will work to achieve between 2009 and 2012, in collaboration with their regulators, designated postal operators and regional postal associations.

In addition to improving the interoperability, quality and efficiency of the world postal network, the strategy aims to stimulate a universal postal service adapted to the social, economic and technological environment; promote sustainable development of the postal sector and its economy; and foster the growth of the postal market(s) and services.

The strategy’s objectives basically cover what was provided for in the previous Bucharest World Postal Strategy, but they are more detailed and better focused on 18 programmes. They are also based on the three main areas, including the interoperability of postal networks, development and governance.

The implementation will be carried out using a regional approach based on well-defined indicators, which will allow achievements and shortcomings to be monitored.

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The UPU's mission to remain the same

Posted by | Jul 31, 2008 | |

Even though a majority of UPU member countries voted in favour of it, a proposal to expand the UPU’s fundamental mission was rejected yesterday (30th July) during a plenary session of the 24th Universal Postal Congress after it failed to obtain sufficient support.

The proposed amendment to the preamble of the UPU Constitution needed the support of at least two thirds of member countries having the right to vote at Congress, i.e. 171 of the 191 Union member countries.

The United States of America, supported by Norway, opposed the change, which went to a vote.

In the end, 97 countries voted in favour of the new proposed mission, while 28 voted against it and 17 abstained. Despite the positive result, 114 favourable votes were needed for the proposal to be adopted.

The document proposed that Congress adopt a new UPU mission that covered the full extent of the postal sector’s role and scope and, consequently, the current role and scope of the UPU, including its role as a United Nations specialized agency. In particular, the mission would have recalled the adherence of the UPU to the United Nations Organization and the postal sector’s contribution to fostering trade and promoting economic and social development worldwide.

Some countries defended the document, saying that the proposed mission better described the current reality of the postal sector, which is not limited to the distribution of letters and parcels. Others added that this new context would enable them to more easily obtain financing for development projects.

The United States argued that the UPU should focus on the core activities mentioned in the current mission, which is “to stimulate the lasting sustainable development of efficient and accessible universal postal services of quality in order to facilitate communication between the inhabitants of the world”.

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ACCC clears 5c postage stamp price hike

Posted by | Jul 31, 2008 | |

The consumer watchdog has cleared the way for Australia Post to seek government approval for a five cent increase in the cost of a basic postage stamp.

The Australian Competition and Consumer Commission (ACCC) says is not objecting to the postal monopoly’s plan to charge 55 cents from September 15.

“Because the proposed price increases do not involve Australia Post over-recovering the costs of providing … letter services,” commission chairman Graeme Samuel said.

But Australia Post’s proposal did not provide “sufficient certainty” to satisfy customers.

“Therefore, in its decision, the ACCC has established a framework for future price notifications that will encourage Australia Post to continue to reduce costs, improve productivity, and provide more certainty for customers,” Mr Samuel said.

The last time Australia Post increased the cost of the basic postage stamp was in 2003.

It will need approval from the federal government before implementing the increase.

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