Posti Group Corporation’s Supervisory Board
March 14, 2019
Posti’s Supervisory Board: mail and newspaper delivery must be secured
The Finnish society has become significantly digitalized during the past decade with web services, social media, electronic communication and eCommerce establishing themselves. The digitalization of public sector services has sped up during the previous and current governments, as well.
The development of digitalization offers many positive opportunities for the society, but at the same time, it has had a dramatic impact on the postal and media industry. The number of addressed letters delivered in Finland has decreased by half since 2008, and the volume of printed newspapers has fallen to the level of the 1950s. In the coming years, the amount of mail will decrease even faster as the government is planning to give up on sending paper mail almost entirely. According to estimates, the number of letters in 2025 will have decreased by approximately 75–90 per cent from the level of 2000.
Posti’s Supervisory Board is extremely concerned about how newspaper deliveries and Posti’s universal service can be maintained in the coming years as the reduced deliveries wreck the financial base of five-day mail delivery. The declining volume is estimated to cause EUR 150–200 million of lost income for Posti in the next three years.
Without new actions, the heavy decline in the volume of letters threatens to raise unit costs for newspaper deliveries to an unsustainable level. As the number of mail declines, all that’s left in the mail carrier’s bag is newspapers, which have to cover an increasing portion of the delivery network’s costs. However, newspapers cannot afford to high price hikes, as the financial situation of many small and medium-sized newspaper houses is extremely difficult.
As a result of all of this, Posti’s Supervisory Board proposes that the next government will take quick actions on the basis of parliamentary preparatory work to guarantee postal services and newspaper delivery.
Daily newspaper delivery is still important for newspaper subscribers and advertisers. Printed newspapers also play an important role in how citizens obtain information. The support would improve the prerequisites for newspaper operations in the countryside and enable media services to move to the digital era in a controlled manner.
When the renewal of postal regulations continues in the following parliamentary term, it is important that it happens in a competition-neutral manner. Delivery aid must also be implemented via public tendering. Competition is now deregulated with the earlier changes in the Postal Act. Posti operates on market terms without public subsidies.