I work as a postman , so my view is biased . The points I would make are this - the Royal Mail provides the cheapest service in Europe . The Royal Mail can not raise its prices without Government permission and it has been forced (by successive governments for over a decade ) to keep the cost of a 2nd class letter artificially low - it legally has to accept a payment for a standard 2nd class letter which is LESS than what it costs to deliver it .
The losses incurred (> £100million) can not be sustained .
The choice which the public faces would be the bankruptcy of the Royal Mail and a large increase in prices for sending things via private delivery networks (who certainly will not take things at below cost price) ,
or a price increase for the Royal Mail which enables it to be financially viable .
You can read the official response to the Ofcom review here -
http://www2.royalmail...service/customer-news