Tag: TNT Mail

Competition might mean the end of the Royal Mail's monopoly, but the 350-year-old organisation could still deliver surprises

Posted by | Jan 8, 2006 | |

THESE are testing times for Adam Crozier. The Royal Mail’s Falkirk-born chief executive has been facing the prospect of open competition for his pounds-6 billion-plus monopoly since January 1. Foreign players, including TNT and DHL, owned respectively by the Dutch and German national post offices, as well as Birmingham-based UK Mail, part of Business Post, are all eyeing up a slice of the action. Most of the 14 players who have been awarded UK operating licences by regulator Postcomm are hoping to cherrypick the most profitable parts of Royal Mail business.

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Red letter day for UK postal services

Posted by | Jan 8, 2006 | |

You shouldn’t expect rival posties scrapping on your doorstep, a choice of different companies’ stamps or new post boxes springing up next to the Royal Mail’s signature red pillar boxes. But on new years’ day, the UK brought the last great government-owned monopoly, that on post, to an end, liberalising a market worth GBP6.5bn (USD11.4bn, E9.14bn). Any company can collect, sort and deliver letters of any size.

It’s hard to understand why it took so long. As far back as 1970, before Margaret Thatcher had put it on the political radar, the Institute of Economic Affairs published a monograph – The Postal Service: Competition or Monopoly – arguing that the Royal Mail’s then 320-year monopoly be scrapped. But the writer, Ian Senior, a postal economist who runs Triangle Management Services, has had to wait his whole career for it to happen.

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Rivals seek to block UK Royal Mail's pounds 2bn handout

Posted by | Jan 1, 2006 | |

TNT, a competitor to Royal Mail in the UK, is warning that it will complain to Brussels if the government agrees to put public money into the state-owned postal operator to fund investment. With all restrictions on competition lifted today, Royal Mail chairman Allan Leighton believes the group needs pounds 2 billion investment if it is to compete with major international operators such as TNT and DHL Global, part of Deutsche Post. The government is considering a loan or an equity investment styled on a rights issue. However, TNT believes any such move could be anti-competitive and break the rules on state aid. Nick Wells, chief executive of TNT Mail, said: ‘If it is unfair and anti-competitive, we are not going to sit there and watch it happen.’ TNT’s legal adviser, Angus Russell, said there were problems with both arrangements. With a rights issue, the government as the shareholder would subscribe to all shares offered – unlike in the City, where investors can refuse if they think it offers bad value.

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Rivals snap at the heels of UK Royal Mail

Posted by | Dec 29, 2005 | |

Royal Mail expects to lose “billions” of mail items to its rivals over the next 12 months, following the opening up of the market to full competition on January 1. And in the change that will follow the New Year’s day revolution in the postal services market, it is business customers that are expected to be in the lead. Royal Mail lost its monopoly on mailings of 4,000 and more items in April 2003. Next week, the rest of the Pounds 6.5bn market, including lower volumes of mail sent by small businesses, is being opened up. Companies account for more than 80 per cent of the licensed market: mail costing less than Pounds 1 and weighing less than 350g. Royal Mail’s main competitors include TNT Mail, the UK arm of TPG, the Dutch postal group; DHL Global Mail, the UK arm of Deutsche Post, the German postal operator; and UK Mail, owned by Business Post, a quoted express delivery company. Those competitors say they intend to use the January 1 liberalisation as a catalyst to step up the pressure on the state-owned operator, using a combination of pricing and product innovation to try to woo more of its business customers.

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