The problems for Royal Mail got much worse when private companies were allowed to cherry pick the profitable parts of the business, leaving RM with a pricing policy to deliver a letter the next day from one end of the country to the other, which meant they were loosing approx 4p for every first class letter they delivered. (These were the approx figures when I left the business)
Private companies were also allowed downstream access to our delivery service, meaning they could collect 1000s of letters leaflets etc. from a company bring them to our mail centre where we had to deliver them for a few pennies.
Now the Royal Mail is on the verge of being privatised it has to stand on it's own two feet and make a profit, I agree people will not send as many letters so there will be many more job losses, leaving a profitable company renamed Deutsche Post.