Where given far more then a fresh start from clearing all their existing debt before they were sold off on the stock market, an exercise that most think saw them vlaued way below their real value.
They were given an advantage most companies could only dream of in the market place. An advantage worth millions in the open market at the time. Perhaps not so much now they’ve made such a mess of the market and changes to laws that surround them. That advantage was clear access to the existing customer databases with millions of contact details and account history not ony for customers but also suppliers. What’s worse those customers didn’t realise and didn’t get any benifit from it, in fact pehap it helped to put their bills up higher than they shoud have been.
Pretty quickly after privisation of these companies the suits in charge soon realised they could expliot this free gift they had been given. In fact it would be foolish not to assume they hadn’t realised this, and the government hadn’t realised the true value either. Yet no restrictions were given on the companies and no oversight was put in place.
So how were these databases exploited ? simple cross selling. Suddenly your bill included recommend offers and services such as home insurence, assurence and even pet protection. All these services managed by companies setup by privatise utilities. Each looking to make a profit from the customer database they had exclusive access too.
This is the point where Neolibrals exclaim “Great, extra income means greater profit. Better for shareholders and customers too via great dividends and lower bills” Errr no sorry. What’s happening here is the Utility takes all the risk and gets on reward. Many companies failed to even get of the ground and the investment came from the utility so they took the hit. If the new venture was a success sure the shareholder may have benifited by that’s not proven and very quickly the new ventrue would be split off and even sold off for massive profits. Some of these companies could have been valued higher then the utility that gave birth to them.
If a utility database could be worth billions to a marketplace like insurence how much do you think the NSH database is worth ? it covers everything from Insurence, private healthcare, Big Phama even holidays and pensions.