Business Daily (BBC World Service)

Episode: What's the future for state-owned postal services?

Date: December 10, 2025
Host: Russell Padmore

Episode Overview

This episode of Business Daily examines the uncertain future of state-owned postal services worldwide amid mounting losses, shrinking demand for traditional letters, and fierce competition from private logistics companies. The episode explores how different countries are responding—with some considering privatization, others doubling down on modernization, and all facing growing pressure to adapt through automation, artificial intelligence, and expanded services. The discussion includes voices from postal executives, economists, technology journalists, and logistics industry experts.

Key Discussion Points & Insights

1. The Decline and Transformation of Postal Services

• Billions of letters and parcels are mailed globally each year, but state postal services face rising deficits and competition from private firms (01:09).
• Traditional mail is declining: In Denmark, letter post volume has dropped by 90% since 2000, and some countries are ending letter deliveries altogether (06:25).
• Postal services are diversifying, shifting focus to logistics, parcels (especially driven by e-commerce), and financial services (03:17).

2. Modernization and Competition

• Case Study: Ireland (An Post)

  • CEO David McRedmond discusses how they're transforming from a letter business to a logistics and services company (03:17).
  • The trusted postal brand and local knowledge are competitive advantages against global firms (03:52).
  • Parcel volume is growing rapidly, outpacing expectations (03:17).
  • Electric vehicles and potential drone/robot delivery are part of modernization efforts (05:16-05:50).
  • AI is being leveraged for route optimization and predictive delivery (06:02).

• Case Study: United States

  • The USPS faces massive losses ($9.5 billion in 2024) and shrinking volumes (07:35).
  • Discussion about privatization versus state ownership: Pressure to privatize is growing due to chronic deficits (07:58).
  • Political and regulatory constraints severely limit modernization and flexibility compared to private competitors (09:12, 09:53).
  • "Delivering to 163 million addresses six days a week...is a remarkable logistical feat...that's also its greatest burden." — Peter S.E. Earle, 01:35/08:33.

• Case Study: India

  • Despite consistent losses, privatization is considered highly unlikely due to the vital social service and rural reach of India Post (13:14, 13:57).
  • 99% of its annual budget goes towards salaries and pensions. Its vast physical network is a key asset (13:57-14:45).
  • India Post is expanding into financial services and partnerships, especially in rural areas, while staying under state control.

3. Role of Technology: Automation, Drones, Robotics, and AI

• Postal modernization includes experiments with drones for remote/last-mile delivery (02:07, 15:28, 17:09).
• AI and robotics are integral to industry transformation, particularly for route planning, sorting, and predictive delivery (05:50; 17:50).
• National services face hurdles in tech investment, unlike giants like Amazon which have vast R&D resources (16:46).

4. Broader Economic and Social Considerations

• Debates on privatization hinge on social obligations, affordability, and rural access, versus investor reluctance to acquire loss-making entities (04:33, 13:57).
• In some countries, the public service function and trust in national post outweigh the push to privatization (14:45).
• Global competition means national posts need major investment to compete internationally, which is challenging for state-run organizations (18:22).

Notable Quotes & Memorable Moments

• “Delivering to 163 million addresses six days a week...is a remarkable logistical feat. You know, that's also its greatest burden.”
  — Peter S.E. Earle (01:35/08:33)

• "Letters are less than half of our business now. We have financial services and other services. Parcel delivery, e-commerce begins to take over."
  — David McRedmond, An Post CEO (03:17)

• “There is a heavy social service obligation. It's priced way below cost to make it affordable as a service to society.”
  — Deepak Lalwani, India economist (13:14)

• “The postal brand is trusted... you need local knowledge, you need people on the ground. That gives us an advantage.”
  — David McRedmond (03:52)

• "AI can really help us cut through... How do you find more efficient routes to deliver? We should, for example, be able to predict who is in before we deliver without actually knowing."
  — David McRedmond (06:02)

• "For national Postal Service to be able to have a kind of R&D department at that level is probably a bit pie in the sky thinking."
  — Elaine Burke, For Tech's Sake podcast (16:46)

• “In my 30 years of specializing on Indian investments, I have never seen it on the list of privatization. Quite frankly, you need investors to buy the company, and investors would not be interested in a loss-making public service.”
  — Deepak Lalwani (13:57)

• “People tend to want things faster. There's been a sense of this kind of Amazonification of people's expectations... that's something that can be a challenge to keep up with.”
  — Elaine Burke (16:10)

Timeline of Important Segments

| Timestamp | Segment | |-----------|----------------------------------------------------------| | 01:09 | Episode introduction: scale and challenges of post | | 01:35 | Peter S.E. Earle on USPS burdens and achievements | | 02:07 | Modernization and drones in Ireland | | 03:17 | David McRedmond (An Post) on business transformation | | 05:16 | Drones, electric vehicles, robots in post | | 06:02 | AI and the future of delivery | | 06:25 | Impacts of digital transition in Denmark & US | | 07:58 | USPS losses and debate on privatization | | 08:33 | Economist Earle on administration’s privatization push | | 09:53 | Earle on regulatory barriers to modernization | | 13:14 | Deepak Lalwani on India Post and social obligations | | 14:45 | India Post’s rural advantage and diversification | | 15:28 | Swiss drone tests and tech-driven delivery abroad | | 16:10 | Elaine Burke on rising customer expectations | | 16:46 | The tech investment gap: state posts vs. Amazon | | 17:09 | Drones for last mile, challenges (noise complaints) | | 17:50 | AI for route and workflow optimization | | 18:22 | Global competition and network scale challenges |

Conclusion

This episode underscores that the future of state-owned postal services will be shaped by their ability to modernize, leverage technology, and adapt business models to meet consumer demand and competition from private firms. Social obligations and the broad national networks of these services remain vital to their identity and, in some cases, to their survival under government control. However, embracing automation and AI, expanding services, and finding new revenue streams are now essential to staving off decline—or irrelevance—in the era of digital communication and global logistics giants.