Liberalisation of the EU Postal Market Need for Restructuring of Postal Operators

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Liberalisation of the EU Postal Market Need for
Restructuring of Postal Operators

• Marc Pouw
• Secretary General - PostEurop

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PostEurop

• 43 Public Postal Operators
• Network reaching out to 800m
• 200,000 counters
• 2.1 million staff
• 130 billion mail volumes (2004)
• 1/3 of world wide postal volumes
• Representing gt 40 of UPU contributions
• Lead in 16 groups in UPU

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Various forces at work in the postal industry.

Regulatory
Technology

Traditional letter mail volumes being eroded by
substitute electronic services

Liberalisation decision practice DG Comp EU
courts The social and political context has a
significant impact on the liberalisation process
of former state monopolies
Enhanced capabilities to manage complex solution

New products services
Postal Industry
Customer demand
Globalisation/Competition
Growth will continue in advertising mail, parcel
and international services The growth of
eEconomy is also affecting the business customer
needs. They expect posts to become competitive in
terms of service and technology. Providers of
service to companies are challenged to account
company specificities (such as size, industry)
and create true value to its clients e.g.
through integrated solutions, ad hoc on-line
tools

Large European postal operators are expanding
internationally through acquisition of package
distribution express and logistic services
providers

,
Partnerships are being formed to improve both
services and access to international markets

Source adapted from Accenture, 2000
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Mail volume per capita varies from one EU
country to another
Number of addressed mail items delivered per
capita
Source Ecorys 2005
includes addressed, items of correspondence,
addressed printed matters
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Postal Operators have reacted in various ways,
going from diversification
Sources Annual reports, press clippings,
strategic intelligence
UPU figures 2003
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to increased efficiency
Sources Annual reports, press clippings,
strategic intelligence
EBIT Margin EBIT / Total Operating Income
(consolidated accounts) Regarding De Post-La
Poste, consolidated data not available for 1999
and 2000. 7.6 out of the 9.6 growth between
2000-2001 due to consolidation
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Postal market in Europe

• Reserved area 50 grams and 2,5 X domestic tariff
• NRAs installed in 25 Member States
• 3rd Directive now in the making
• Commission studies
• 2005
• evolution of the regulatory model for European
  postal services
• development of competition in the European postal
  sector
• 2004
• main developments in the European postal sector
• the economics of postal services

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Road towards liberalisation is still uncertain
50 g for services which might be reserved to the
universal service providers 2.5 times the public
tariff for an item of correspondence in the first
weight step of the fastest standard category EU
report about the status of the liberalisation of
the European letter market.
100 g for services which might be reserved to the
universal service providers 3 times the public
tariff for an item of correspondence in the first
weight step of the fastest standard category
Weight limit
?
EU review and proposal confirming, if
appropriate, the date of 2009 for the full
accomplishment of the internal market for postal
services OR determing a relevant alternative step
towards it.
Price limit
Other
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Postal market in Europe

• Disruptive scenario
• POs privatising and on public stock exchange
  (Deutsche Post Germany, TNT the Netherlands,
  Austria in 2006)
• Changing composition ownership Posts (CVC
  investment group)
• Danish Post CVC
• Belgian Post Danish Post / CVC
• Significant diversification - revenues no longer
  only from mail

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Postal market in Europe

• Disruptive scenario
• Part liberalised markets
• All EU 25 (up to 50 grams and 2,5 X basic
  tariffs)
• Beyond EC 2002 Directive requirements Czech
  Republic, Netherlands, Norway, Romania, Slovenia,
  Spain, Switzerland
• Fully liberalised markets
• Estonia, Finland, Sweden, United Kingdom
• 2009 possible further opening of market for EU
  25

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Postal market in Europe

• Key factors of change
• Market changes increased needs of customers
  (globalisation, digitalisation)
• Market liberalisation possibly full opening to
  competition in 2009
• Obligations of USO
• Financing of USO
• Impact of politics on posts (flexibility and
  freedom to act in response to challenges)
• Technology impact on operations cost reduction
  factor
• Corporate Social Responsibility (CSR)

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Postal market in Europe in 2012

• 3 factors necessary for a viable and sustainable
  postal sector in Europe in 2012
• Flexiblity
• free from unfair and unbalanced constraints
• Quality of service
• keep customers
• Innovation
• adapt to new market needs and requirements

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Response from PostEurop - Vision

• PostEurop represents the European Postal Industry
  
• It supports its Members throughout the evolving
  market and promotes the industry interests to all
  stakeholders

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Some thoughts for 2012

• Email is mail too
• Volumes decline murphys law / self fulfilling
  profecy PostEurop focuses on increasing volumes
  in cooperation with all interested industry
  stakeholders
• Composition of mail changes POs need to remain
  vigilant and flexible to deal with changes
• High political dimension hinders flexibility
  (civil servants)
• UPU needs to take into account specificities of
  European postal market in work programme
  increase flexibility from regulators, solution
  for USO provision and financing

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EUROPE in 2012?

• Disruptive scenario
• Are we in the cold wave scenario???
• Social mail, Direct mail, E-commerce mail
• Transformation of composition of mail
• Significant diversification
• Changes in structures
• Levels vary per PO
• Europe is in 2012 already

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Contact PostEurop Headquarters Tel 32 2
7247280 Fax [phone] Email
posteurop_at_posteurop.org