•

Datum Name

Need for a Framework SDI Business ModelEuroSDR

eDelivery Workshop

BKG, Frankfurt, 2005-2-23

Dr. Roland M. Wagner

Name: Dr. Wagner 2

Relationship: Business - Technology• Business Model depends on available/affordable Technology

• Technology Model depends on Business model

Business Model

Scenarios

Implementation Model

Actor Model Process Model

Architecture Model

Source:Initiative GDI NRW Referenzmodell Version 3.1

Name: Dr. Wagner 3

Development

Iteration

Business Model

Implementation Model

Business Model Development

DevelopmentDevelopmentDevelopment

• Business Model: Collection of Use Cases after Sept. 04

• Implementation Model: Collection of Technologies

Name: Dr. Wagner 4

• Business Model: Collection of Use Cases after Sept. 04

• Implementation Model: Collection of Technologies

Development

Iteration

Business Model

Implementation Model

Business Model Development

DevelopmentDevelopmentDevelopment

Examples:

• Pricing Information• Shop• Portal• Applications/Services

• Copyrights• Authentication & Authorization• Pricing & Ordering

Examples:

• DACS• WPOS• SAML• OSCI• … other GeoDRM, see OGC Survey December 2004

Name: Dr. Wagner 5

“Classical” Business Models A-C

Name: Dr. Wagner 6

GI Distribution: State-of-the-art

Iteration

Business Model

Implementation Model

Business Model Development

Development

• Business Model: Shop / Portal, “experts only”

• Implementation Model: propriety geoDRM solutions sufficient

Business Models:• Usage Info [A]• Shop [B]• Portal [C]

Technology Models:• 1:1 Technologies• …

???

But is a Usage_Info/Shop/Portal Business Model an Infrastructure Business Model ?

SDI

SDI

Name: Dr. Wagner 7

Sustainable OGC geoDRM Solutions…require significant investments and depend directly on the general and

concrete Business Models ! A strategic view is important.

Therefore geoDRM Solutions should

• cover • existing Business Models (e.g. Shop or Portal) and• future Business Models (Spatial Data Infrastructure)

• be often re-used as much as possible in the value chain

(=> cutting costs => affordable)

SDI Business Model

outlook required for progress

Name: Dr. Wagner 8

Spatial Data Infrastructure• Where are the SDI system borders?

• How to organize multiple SDI-operators?

• Open or closed Infrastructure?

• If closed, which organization operates it?

• If open, is it reliable from a business point of view? How to control payment?

• Is it a market with multiple providers with different products?

• Is competition possible (same products, different conditions)?

• Is there a Quality-of-Service Control?

• Which investment in a SDI is required for significant return?

• Is a SDI feasible from an economic point of view?

Name: Dr. Wagner 9

Question:

What is theFramework

Business Modelof a

Spatial Data Infrastructure ???

Name: Dr. Wagner 10

General Business Model

Does a

Framework Business Modelexist in

other Infrastructures ???

Name: Dr. Wagner 11

Yes, see other Infrastructures• Electricity

• Periodical Fee, Usage Fee x x

• Water

• Vancouver: Periodical Fee x

• Münster: Periodical Fee, Usage Fee x x

• Airlines, Railways

• Usage Fee x

• Telecommunication,Telephone / Internet

• A.) Periodical Fee, Usage Fee, e.g. Distance x x

• B.) Usage Fee (Call by call) x

• C.) Periodical Fee, (Flat line) x

All concrete Business Models within the Framework Business Model

Name: Dr. Wagner 12

Statement:

Without

a SDI Business Model

no Business (geoDRM) Software

Name: Dr. Wagner 13

Need for a SDI Business Master Plan• Development of the General SDI Business Model required !

• Concrete Business Models of companies within the General Infrastructure Business Model

• Financial grounding required for investments

• Assumption about re-use by• mass market or expert market• multiple usage in value chain

important for grounding to re-finance investments in• Tools technologies

• SDI software

• SDI.geoDRM software

• Which level of total investments? 1 Mio … 10 Billion …?

Name: Dr. Wagner 14

Inductive or deductive Approach

Inductive

• Trial and error

• Native growth

Deductive

• Existing Model from other domains

• New Model derived by existing model

• Results in a Master plan

Deductive, Telecommunication Industries and Operators:

GSM Business Model

•

Datum Name

Telecommunication Industries and Operators:

GSM Infrastructure Business Model

Name: Dr. Wagner 16

GSM Model

Name: Dr. Wagner 17

GSM: Success Story DB Research

• …we estimate that mobile telephony has created 4.1m jobs worldwide

• Why GSM? Without GSM we believe the pace of development of mobile telephony would have pared dramatically and that additional revenue streams, such as roaming (estimated globally at $1.78bn in 2003), would not have been as successful.

• In 1982, the Global System of Mobile communication (GSM) was established to initiate European telecommunication standards. Since 1992, it has been swiftly adopted by nations around the globe and now incorporates over 616 operators and 200 countries worldwide.

Name: Dr. Wagner 18

GSM: Success Story DB Research

• The success of GSM is that its development was founded on the delivery of a specific user benefit - international roaming. The demands of international roaming had profound changes on GSM’s architecture and mandated an open future-proof standard that ensured interoperability, without stifling competition, and innovation among suppliers.

• …This resulted in a profound change in users’ mobile communication style from vehicular-based to personal, opportunity-based communications.

Name: Dr. Wagner 19

Why has been GSM so successful?

Key Factors:

• Standardisation• Economies of scale

• Global roaming

Name: Dr. Wagner 20

Key Factor: Standardisation• Conversely in Japan and the US - where GSM was not initially

adopted - it was common to have the network operator produce handsets and network equipment, provide mobile services and sign contracts with content providers. In such an environment, consumers could not easily switch from one network operator to another, which stifled competition and technological innovation. Moreover, the proliferation of multiple networks of varying conflicting standards in the US resulted in sparse national coverage, lacking interoperability and thwarting potential subscribers from roaming outside their regular service area.

Name: Dr. Wagner 21

Key Factor: Economies of scale

• By focusing R&D to one large market, the advent of the GSM standard reduced development costs and provided suppliers with huge economies of scale in both network elements and handsets. Today, GSM’s maturity and widespread production makes it far more price competitive than any other mobile technology.

• The pre-paid market is the largest growth segment of the mobile phone industry

Name: Dr. Wagner 22

Key Factor: Global roaming

• At the core of the GSM philosophy was the concept that a single standard would provide subscribers seamless and standardised contactability, regardless of national boundaries. The ability to roam, or use one’s mobile on any other GSM network globally, IS the raison d'être of GSM.

• Global roaming, facilitated via the unique authentication feature of the SIM, has contributed greatly to the success of GSM, allowing the delivery of services to users across continents…

Name: Dr. Wagner 23

Infrastructure Costs

• The installed first cost of GSM mobile telephony networks throughout the world is approximately $300bn since the inception of GSM

• The telecommunications industry in the OECD invested nearly $230bn during the decade ending 2000

• In the UK and Germany, the spending on GSM licenses was the equivalent of almost $600 per inhabitant

•

Datum Name

Conclusion

Business ModelGSM vs. SDI

Name: Dr. Wagner 25

Assumption:

A Geoinformation Product for orientation is

as much important for personal mobility

as communication

Name: Dr. Wagner 26

Conclusion• Roaming between SDI content provider is required to bridge

• Geographic distances, e.g. US vs. Canada, and • scaling gaps (Earth-Country-City-House-Room-…body[RFID])

• standardised contactability is a key factor for roaming, supported by geo-

eBusiness/geoDRM Software

• Roaming would have profound changes on SDI’s architecture, therefore it’s

strategic valuable to identify them already now

• SDI requires high investments, therefore standardization is a key factor for

software, hardware and general business models, and therefore contracts

Name: Dr. Wagner 27

Conclusion

• Competition can be done with concrete pricing models within the

General Business Model

• High Investment risk need to be shared

• Mass market is the big goal

• …

• [Many more parallels between GSM and SDI]

Roaming requirements for geoDRM functions

Name: Dr. Wagner 28

Discussion

•…• Are the today's National Mapping Agencies thenew “Telecons” Companies in 10 years?• …