[mattgibson]

If you define 'effective' as 'maximises the amount of money that shareholders get', then it's not ineffective at all. The best investments you can get are monopolies where the companies provide shit services. Costs are very low (because you pay for as little as possible, therefore it's shit), but the monopoly keeps revenues artificially high, leaving big profits in the middle. A cynic might say that this approach was deliberate, and that the competition not arriving was predictable and intentional. You get a system that looks like a free market, but which isn't.

See the recent parallel in how competition does not work well in the natural monopoly of postal delivery: http://www.telegraph.co.uk/finance/11596796/Royal-Mail-share...

"Whistl's announcement shows it is very difficult to set up a delivery service in urban areas in the UK that makes a profit, the vast majority of the cost is in that last mile of delivery."

Not likely to be much competition then. What better investment could you get (for your mates)? http://www.dailymail.co.uk/news/article-2455653/George-Osbor...