An independent report, written for UK Mail, dismissed the often-citedoption of ‘structural separation’ for the Royal Mail suggesting instead a radical new commercialmodel with two accountable businesses operating independently with distinct targets.
The report was undertaken by David Stubbs of Europe Economics,technical economics consultancy in UK, commissioned by UK Mail.
The new model introduces a new business unit, Royal Mail Sales, whichwould interface with customers, and would contain all existing retail sales, marketing and productdevelopment aspects of Royal Mail. It would operate alongside Royal Mail network which would beresponsible for the operational delivery of postal services and sell services to access customers,downstream access providers and Royal Mail Sales on an equal and transparent basis.
“This model would give Royal Mail staff much stronger incentives tomaximise the value of its universal service infrastructure as a commercial asset – providing postalservices to a wide range of customers and would ensure that all customers such as access customers,downstream access providers and end to end customers are being treated in the same way. This couldincrease the benefits that the UK is deriving from the infrastructure and assist the safeguardingof universal service provision for the future,” explained David Stubbs.
Guy Buswell, UK Mail CEO commented: “We believe that this paperproposes a radical and much needed change which will instil a new commercial outlook to the benefitof the mail industry as a whole – customers, competition and Royal Mail itself. It is a lessproblematic option than structural separation in many ways.”
