Competitive Market Review & Business Customer Survey

Crown Copyright 2006

Competition

Since full market opening on 1 January 2006, competition and choice has been available to all businesses and this year's survey contains the views of companies of all sizes. Previous business customer surveys have concentrated on larger mailers because, until 2006, only the bulk mail market was liberalised.

As of September 2006, Postcomm had issued 17 licences to postal operators in addition to Royal Mail.

New operators have tended to enter..the market through access agreements, targeting large regular mailers in order to build volume and customer relationships.

Having targeted many of the key high volume transactional mailers, access providers are beginning to explore the unsorted mail market by offering mail consolidation and sortation. A few access operators are investing in sorting equipment to expand their customer base to include smaller business customers and those that cannot or do not want to sort their own mail.

Postcomm is attempting to engage views of the entire population of business customers. This impacts some of the trend data in this year's survey, in that smaller mailers appear to be less aware of the competitive marketplace and less inclined to switch suppliers.

Competition in downstream access may encourage operators to win volumes of downstream access traffic that they can eventually carry through their own end-to-end network. Up to now, end-to-end competition has been slow to develop, due mainly to the difficulty of competing with Royal Mail's economies of scale.

For a full transcript of the Postcomm Competitive Market Review please use the following link:

http://www.psc.gov.uk/competition/competitive-market-reviews.html