The internet revolution has transformed the economics of postal services around the world. It is no news that, the internet has reduced the demand for letter mail because emails are a cheaper and quicker means of communication. And that online shopping has taken a growing share of the retail market and has boosted the demand for parcel mail. Less widely known is that the incumbent postal operators have also suffered from the introduction of competition into lucrative urban markets, eroding margins originally designed to help pay for loss-making rural services.

It is also often forgotten that GDP, which measures overall economic performance, plays a big role in driving postal activity. US data show very clearly how annual mail growth, which tracked GDP growth closely for most of the 20th century, started to grow more slowly than GDP in the mid-1990s as internet usage spread. From 2007 the Great Recession ushered in a new era of falling letter volumes. The performance of postal operators around the world depends on how badly their economy was affected by the Great Recession, and how rapidly they have responded to falling demand for letters by switching into the more buoyant market for parcels.

The main aim of this report is to show how different postal operators have coped with the twin challenges of the Great Recession and the spread of the internet and to identify countries where, taking account of GDP, postal operators’ performance on volumes, prices, employment and labor costs is out of line with their peers.

Find out more about how are the postal operators are surviving in this internet age. Report (PDF 1.3 MB)

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