Sun, Jan 01, 2006 - Page 11 News List

UK's Royal Mail opens up to competition

THE GUARDIAN , LONDON

The UK's postal market, valued at ?6 billion a year (US$10.3 billion), opens up to full competition next week with 14 companies lining up to take on Royal Mail as its 350-year-old monopoly finally ends.

Officially, competitors will be able to collect, sort and deliver mail from single letters to bulk deliveries from today, though the New Year weekend means competition will be on hold until Tuesday.

Postcomm, the UK's postal regulator, promised new choices for customers across a range of services and the industry watchdog, Postwatch, said a competitive market was the best way to protect customers' interests.

Royal Mail, which is struggling with a ?4 billion deficit on its pension fund and needing about ?2 billion worth of investment to modernize its sorting operations, has pledged to fight for every letter.

Industry observers believe the UK will not suddenly sprout multi-colored post boxes alongside the familiar red ones or see strangely uniformed figures jostling the local postman on the doorstep. New entrants are initially expected to rely on agreements over access to Royal Mail's delivery network, with existing postmen and women making the final delivery. Royal Mail, however, believes its rivals will start delivery services, cutting it out.

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