Data that can be used for the performance of public tasks is increasingly being collected by parties other than the government (=third party data), sometimes as a by-product of their core processes (like data produced by TomTom), sometimes as a hobby (such as pedestrians updating OpenStreetMap) and sometimes with a specific mission (measuring noise values by citizens living in the area of the Dutch main airport Schiphol). Quite rightly the government looks at these data with great interest also realizing that its position and role is changing as a result: the powers differ from the situation where it collects the data itself. This has quite some implications for the its responsibilities, such as quality guarantees and continuity of delivery and service provision, accountability and publicity, allowing reuse and maintaining fair market conditions. In a study we take stock of what is already happening in this area and lists the questions and wishes.
To this end, 10 Dutch governmental organizations from all levels of government have been interviewed. We thereby focused is on so called 'non-traditional' arrangements: situations where there is an exchange of value between the public and private sector not being based on a purchase agreement or a legal obligation to provide these data. Clearly, in view of Geonovum's mission, we have put emphasis on those arrangements where location data plays a crucial role.
The current state of affairs
Judging from the interviews held governmental use of third party data is hot, but there are also many questions. Some of these questions are preventing governments from taking the next steps, while others are reaping the opportunities. There are major differences in the maturity of the initiatives, varying from
cautious project-based trials (RIVM, RWS-CIV and RWS Climate Monitor) to integration into the core processes (CBS, NDW). Also strict adherence to the legal task and frameworks play an important role (RIVM, CBS, Cadaster).
Looking at the private sector we mainly see players from high-tech and somewhat oligarchic markets that are willing to enter into such arrangements. Often the can rely on their own infrastructure. In fact their services built on top of the data makes them profitable. Their motivations for entering into an arrangement vary ranging from 'positive publicity', 'data cleaning', AVG compliance checks, but also the notion that the provision leads to innovation within the government, which can lead to further growth of the markets relevant to these players.
An underlying prerequisite for the establishment of these arrangements is that both parties have the will and the mutual expectation that the transaction is the start of a long-term relationship and that the relationship will continue to deliver value in the longer term. Accordingly, from the side of the public sector
this requires not only empathy with the needs of these third parties but also the ability to satisfy those needs in the longer term.
Transaction costs as an explanatory factor
As mentioned, there are large differences between the government organizations interviewed. How can these be explained? If we assume that there are no acquisition costs on either side of the transaction, only the transaction costs are important: if these are lower than the benefit that parties (on both sides) obtain,
then the transaction is concluded. These transaction costs consist of three components: (1) the costs of finding an exchange partner, (2) the costs of making the agreements and (3) the costs of executing the agreement.
Looking closely at the 10 cases we can draw the following conclusions:
- The smaller the group of parties involved, the lower the transaction costs for finding the exchange partner, especially if the parties already have worked together in the past.
- The data involved will have a major impact on the transaction costs related to the fine tuning of supply and demand. This applies both to the standards to be se as well as to addressing legal complications. In particular the presence of (sensitive) personal data determine to a large extent the costs of - and in fact the chances of - the transaction.
- public sector organisations with an existing and high-quality technical infrastructure and experience and knowledge in the field of data management are ideally suited. However, the internal organization must also be geared to this and, ideally, there is internal pressure (budgetary pressure and leadership) to set up these arrangements.
- Nevertheless, even small parties can come to (indirect) arrangements. Existing good relationships with customers and sectoral nodes are crucial in this respect.
The wish lists
Wish lists from the interviewees indicate a need for more space, clarity, time and money to further explore this area. At the same time, they also call for a political-ethical discussion about the new division of roles:
how to fill the vacuum left by the retreating government, how to draw the new lines of demarcation?
This discussion must be about the values we consider important, the (new) interests we want to protect collectively and the new standards that emerge from this. The need for reorientation does not only apply to the public sector side. The reallocation of tasks and responsibility should lead to companies feeling (more) responsibility for public tasks.
New demarcation lines
Judging from the successful arrangements parties from both sides realize that there is a need to establish a more sustainable division of roles as the current basis for the arrangements (the mutual interests, the leadership thereon) are not for eternity. In this context, it seems likely that a kind of ‘three-way division’
will arise. First of all, there is a certain part of the public task that is so essential (such as public safety and water management) that the government cannot be dependent on data from third parties and must therefore always rely on its own infrastructure and data collection processes.
At the other end of the spectrum lies an area where, from the point of view of efficiency, the market may 'take over from the government'. The presence of watchdogs, such as the Personal Data Authority and the Consumer and Market Authority, should be sufficient to safeguard and, if necessary, defend public
interests.
The middle area is the 'exciting' area. Here the level of potential public interest in the data collected by third parties is so high that it seems logical to regulate 'this market'. It would be obvious to look for existing levers that the government has and that are uncontroversial, such as, for example, the government's responsibility for allowing vehicles onto the Dutch roads. In this respect, regulations could be enforced to the effect that access of the vehicle to the public road also means that the government obtains access to and use of (part of) the data collected by the vehicles sensors.
What's next
It is beyond doubt that public use of third party data is an area of great potential and that further exploration is an obvious next step. Various lines of development are conceivable in this respect: exploring the legal position in more detail; what are the ethical dimensions to be set; experimenting in domains and themes are most promising (for instance in energy transition, housing, mobility). Furthermore, it goes without saying that a link must be sought with recent other Dutch data-related policy initiatives, such as the National Data Agenda, the Digital Government memorandum and the National Digitization Strategy. Many of the issues identified above are touched upon in these policy documents. A number of members of the Dutch Geo-information Council (GI-Beraad) have already indicated that they will seek to experiment through a number of use cases. In this way, the Council can further contribute to addressing these important questions.