Postal Markets and Electronic Substitution: What is the Impact of Intermodal Competition on Regulatory Practices and Institutions?

Martin Maegli, Christian Jaag, Martin Koller and Urs Trinkner

Competition and Regulation in Network Industries, 2010, vol. 11, issue 4, 382-398

Abstract: The increasing convergence between postal products and telecom applications is a new phenomenon in the communications environment: postal operators provide new services on telecom infrastructures, telecom infrastructures are likely to substitute last mile mail delivery and consumers are likely to demand a secure combination of electronic and physical mail. In the course of the increased substitutability of physical mail by electronic communications and continually decreasing physical mail volumes, it becomes obvious that regulatory regimes in general and regulatory institutions in particular should co-evolve in the future. But, there is hardly any discussion in academia or in practice about the consequences for regulation. Relevant questions are: which parts of current regulation will become redundant? Is there additional regulation needed due to new bottlenecks or changes in consumer behaviour? In our qualitative analysis, we investigate the implications of intermodal competition and growing convergence between postal and telecommunications services on regulatory institutions and regimes. We provide a comparison between the networks and compare the scope of universal services and issues concerning market power regulation in the two different industries. Furthermore, we develop the idea of a unified universal definition with a holistic understanding of the topic before concluding that there is need for a unified regulatory approach in the future. Such an approach will likely consist of a jointly-defined communications universal service and consequently of corresponding regulatory strategies for policy makers.

Date: 2010
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