14 NATS' revenues are the product of its air traffic volumes and prices, plus any non-air traffic income. In the short run NATS cannot increase its revenue: it has very limited control over volumes of traffic and its prices for en route services over the UK and oceanic services are regulated by the CAA. For technical reasons, moreover, NATS cannot normally raise its prices more frequently than once a year, even if the regulator agreed. NATS has adopted a cautious approach to the development of its non-regulated business due to the overriding need to conserve cash following the events of 11th September and to ensure that the core business is sustained.
15 NATS' major costs are largely fixed in the short term, comprising mainly staff wages, as well as repairs, maintenance and interest on capital in respect of its fixed assets.