Post-Liberalization in Germany: “Overhelmingly negative”

Deutsche Post and his competitor pin seen in Prenzlauer Berg, Berlin

In theory the monopoly by the Deutsche Post is gone:

Since 1998, the German Federal Network Agency for Electricity, Gas, Telecommunications, Postal Service and Railways (Bundesnetzagentur) has licensed the professional transport of letters and mail, to which there was no weight restrictions. However, the relevant service providers were obliged to provide the so-called “higher-valued services” such as “same-day express delivery” or collection from the sender by the post office by 31 December 2007. Thus, additional costs that make it usually impossible for the licensees resulted in ‘professional transport of letters’ to set more favorably than the German post office AG in the “normal delivery” in comparison to the usual letter dispatch. With the cessation of the postal monopoly on 1 January 2008, the requirement to provide “higher-valued services” also fell away for the post office competitors.

For a while there was another exception, the German Letter Monopoly (Briefmonopol), wich is also gone:

The Letter Monopoly was a condition created after the German Postgesetz law was changed in 2005—2007 to allow an exclusive license to the German post office, Deutsche Post, for the transport of letters and catalog deliveries of up to 50 grams from the previous 100 grams. This limit only applied to a portion of the postal market in a service industry of some 1,000 providers, but it created a monopoly.

So much for the theory.

The practice: “After fifteen years of market-opening the balance sheet of post liberalization is overwhelmingly negative”, GlobalResearch, a Montreal-based non-profit Organisation founded by Michel Chossudovsky, says in a report called “Deregulating and Privatizing Postal Services in Europe“.

Extract from the report:

With few exceptions, the new competitors emerging from the liberalized market never opened post offices or installed letter boxes. Instead they pick-up mail directly at the premises of their mostly large corporate customers. As for mail delivery, they typically deliver only two or three days a week and only in highly populated areas. Prices for large customers such as banks, telephone companies and online retailers have decreased – not least because they can negotiate individual price rebates. But standard mail costs have increased in a number of countries. However, in spite of major investments in the automation and streamlining of delivery networks and drastic cuts in labour costs (see below), several former national post companies are struggling to break even because of decreasing letter volumes and market losses to new competitors. However, the new competitors also have problems to establish themselves in a shrinking market as shown by the 2008 insolvency of the main competitor in Germany and the recent takeover of a major competitor in the Netherlands.

Join the Pixeloekonom on Facebook, follow him on Twitter, Instagram and Google+ or subscribe via RSS.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.