www.consultingwhere.comandrew.coote@consultingwhere.com

Twitter: @acoote

Andrew Coote

ConsultingWhere

GSDI Addis Ababa

The economics of Open Data:

there is no such thing as a free lunch

1

Agenda

• Problem Definition

• Analysis

• Solution Options

2

Problem Definition

3

The Open Data Proposition

• Free and open public sector information

– Strong political justification for making free to stimulate

innovation and economic growth

– Government information was created from taxation therefore

citizens should be entitled to use it for free

• Benefits flow to Government in the long-term

– through growth in prosperity and increase in taxation

– So, when the decision is taken it is an “Act of faith”

– As there is no proof the promised benefits will be realised

• In some circumstances there are genuine security

reasons NOT to release data

– Stir ethnic tensions

– Bad uses outweight benefits of good uses

4

Producers have a problem

• The problem for National Mapping Agencies:

– There is no such thing as a free lunch – someone has to pay if

they are to continue to produce / maintain the databases

– Open data removes the primary source of income

• Other issues

– How to retain the “value proposition” that national mapping is

an underpinning infrastructure if its free?

– Coping with increased demand for web services

– Intermediation from your customers – the public think its

Google that created the data

– The genie is “out of the bottle” – no way back to charging

– A proportion of the economic benefit flow out of the country

through big multi-nationals

5

Analysis

6

What is the future role of the National

Mapping Agencies?• Apply economics of the market – where MUST

Government intervene?

• Critically analyse the logical of intervention:– Imperatives

• Disaster management

• Security

– Core Government functions

• eradicating poverty, guaranteeing land tenure, protecting the

environment, clean water ….

– Market failure

– Market making

– International Commitments – ICAO, SOLAS

• Do this objectively

7

Solution Options

There aren’t very many!

8

No change?

• Accept the need to rely on central Government

recognition of your value

• In some countries there is “cultural” support for state

funding of mapping:

– this issue seems less problematic, for now ….

– What happens when the political decision is close a hospital or

reduce funding for the NMA?

• If you chose this option, then creating and sustaining

your political profile becomes paramount:

– Build political support

– Build industry support

– Develop a strong business case for continued funding

– Tie yourself to key Government initiatives (e.g. e-government)

9

Amalgamation

• Merger with other smaller agencies

– Statistics (safety in numbers)

– Land Administration (independent source of income)

• Seek to become part of a bigger department

– Defence

– Environment

– Information Technology

– Transport

– This has to downside of being largely driven by one agenda, but

may provide a “buffer” from direct cuts to your budget

– On you own, you are vulnerable – there are no votes in mapping

10

Freemium Model

• Already in play in the geospatial market

– ESRI Free Viewers

– Google Maps

• Open data equivalent:

– Some basic data free, more detailed data charged

• Favoured by Ordnance Survey GB

11

Diversify

• Grow new income streams by offering other services

– Strategic advice

– Training

• In country, risks “treading on toes” of commercial players

– Swede survey have privatised their commercial wing (Metria)

• Internationally, can be seen as a positive move by

Government. Selling the national “brand” overseas:

– IGN France

– Dutch Kadastre

• Curating data for other agencies

• Partnerships with commercial organisations

12

Retrench

Focus on intercepting the Government agenda:– Political Imperatives

• Policy Priorities

• Incident-driven Responses

– Core functions of Government

• Backed by primary legislation, regulation or other forms of directive

or accord

– Market Failure¹

• Including partial failure e.g. advertising drives Google to capture of

building footprint data in urban centres, but no business case for

accurately capturing the coastal zone.

– International commitments

• International Civil Aviation Organisation (ICAO)

• Safety of Life at Sea (SOLAS)

Privatise

• Split operational and policy functions

• Sell-off operational functions

– Database production / maintenance

– services

• Retain policy and regulatory functions in Government

– Land registrar

– Surveyor general

– SDI coordination?

• New Zealand did this 10 years ago

– The operational wing (Terralink) is now financially successful

14

Conclusions

• Strong evidence for wider economic benefits of open

data

• If Government decides to open access, data providers

(not only NMAs) have relatively few options in terms of

their business model

• There is an urgent need for a serious (balanced) debate

about the future role of Government in geospatial

information creation and maintenance

15

Thank you for Listening

16