What does addresses got to do with economic theory and political dogma? turn out that quite a lot. As I was looking at the latest press release from the cabinet office, proudly announcing that the government is investing in (yet another) UK address database, I realised that the handling of UK addresses, those deceivingly simple ‘221b Baker St NW1 6XE‘ provide a parable for the stupidity of neoliberalism.
To avoid doubt: this is not about Open Addresses UK. It’s about the systemic failures of the past 20 years.
Also for avoidance of doubt, my views are similar to Richard Murphy about the joy of tax. I see collective action and common investment in national assets through taxation as a wonderful thing, and I don’t mind R&D investment being spent on infrastructure that might fail – it’s true for Beagle 2 as much as it’s true for a national address database. So you won’t see here ‘this is a waste of taxpayers money’. It’s the systemic issues that I question here.
Finally, If I got some specific details of the history of the development wrong – I’m happy to be stand corrected!
The starting point must be to understand what is the point in address database. The best explanation is from one of the top UK experts on this issue – Bob Barr (OBE). Bob identified ‘Core Reference Geographies‘ which have the following characteristics: Definitive; Should be collected and maintained once and used many times; Are Natural monopolies; Have variable value in different applications; and, Have highly elastic demand. We can also call these things ‘Commons‘ because the way we want people to be able to share them while protecting their future – and ideally avoid ‘tragedy of the commons‘.
Addresses are such ‘core reference geography’. Think about all the applications for a single, definitive database of all UK addresses – it can be used to send the post, plan the census, dispatch emergency services, deliver a broadband link to the right property, check for fraud during purchase transactions, and much more. To make sense of the address above, you need to have geographical location, street name and house number and postcode. Ordnance Survey map can be used to set the location, the street name is set by the local authority and the postcode by the Royal Mail. Merge these sources with a few other bits of information and in principle, you can have a definitive set. Do it for the whole country and you have this ‘core reference geography’, which sounds simple…
The story is a bit more complex – as long as information was not digitised and linked, mismatches between addresses from different sources was not a huge problem, but in the mid 1990s, because of the use of digital records and databases, it became important to have a common way to link them. By that time, the Post Office Postal Address File (PAF) became the de facto definitive address database. Actually, it’s been around since the 1970s, used by the Post Office not as a definitive address database, but to serve internal needs of mail delivery. However, in the absence of any other source, people started to using it – for example, in statistical studies (e.g. this paper from 1988). While I can’t find a specific source for the history of PAF, I guess that at some point, it became a product that is shared with other organisations and sold for direct marketing companies and other users. Naturally, it wouldn’t be what you would design as the definitive source if you start all over again, but it was there, and it was good enough, so people used it.
Without raising false nostalgia about the alternatives, imagine that the need for definitive address database happened at a time when all the entities that are responsible for the elements of an address were part of the public sector. There would be plenty of power struggles, feet dragging, probably cross-departmental animosity and all sort of other obstacles. However, as been proven time and again – when it is all inside the sphere of government control, reorganisation is possible. So you could imagine that at the end of the day, you’d get ‘address directorate’ that manage addresses as national commons.
Now, we can get to the core of the story. Let’s look at the definition of neoliberalism that I want to use here. The definition is from a very good article on the Daily Kos that uses the definition ‘Neoliberalism is a free market economic philosophy that favors the deregulation of markets and industries, the diminution of taxes and tariffs, and the privatization of government functions, passing them over to private business.’ In terms of the political dogma that came with it, it is seeing market solutions as the only solution to societal issues. In the UK, this form of thinking started in the 1980s.
By the time that GIS proliferated and the need for a definitive address database became clear, the neoliberal approach was in full gear. The different entities that need to share information in order to create this common address database were pushed out of government and were asked to act in quasi-commercial way, at which point, the people who run them are instructed to maximise the self-interest of the entity and market their products at prices that ‘the market will bare’. However, with no alternatives and necessity to use definitive information, pricing is tricky. In terms of sharing information and creating a common product, such entities started bickering over payments, intellectual property and control. The Ordnance Survey had Address-Point, the Post Office/Royal Mail had the PAF, and while being still de facto datasets, no satisfactory definitive database emerged. You couldn’t get beyond this point as the orgnaisational structure requires each organisation to hold to their ‘property’, so while the need became clearer, the solution was now more difficult.
In the second round, what looks like a good bottom-up approach was proposed. The idea was the local authorities are the best source of information to create a definitive address database (National Land and Property Gazetteer) because they are the closest to the changes on the ground and can manage them. However, we are under neoliberal dogma, so the whole thing need to operate commercially, and you go for a public/private partnership for that. Guess what? It didn’t work.
Third round, you merge the company from the second round with entity from the first round to create another commercial partnership. And you are still stuck, because fundamentally, there is still the demand to control assets in order to sell them in the market.
Fourth and something that deserve as the most idiotic step in the story is the privatisation of the Royal Mail, which need to maintain ‘assets’ in order to be ‘attractive for investors’ so you sell the PAF with it. It all work within neoliberal logic but the implications is that instead of just dealing with a network of public owned bodies which it is possible to dictate what they should do, you now have it in the private sector, where intellectual property is sacred.
In the final stage, you think: oh, I got a solution, let’s create a new entity that will crowdsource/reuse open data, however, you are a good neoliberal and you therefore ask it to come up with a business model. This time it will surely work, ignoring the huge effort to build business models and all the effort that was invested into trying to pay for a sustainable address databases in the past 20 years. This time it’s going to work.
Let’s ask then, if we do believe in markets so much, should we expect to see a competitor address database to PAF/Address-Point/NLPG appearing by now? Here we can argue that it’s an example for ‘market failure‘ – the most obvious kind is when you can see lack of investment or interest from ‘participants in the market’ to even start trading.
If indeed it was all about free markets and private entrepreneurial spirit, you might expect to see several database providers competing with one another, until, eventually, one or two will become the dominant (the ‘natural monopoly’ above) and everyone use their services. Building such a database in the era of crowdsourcing should be possible. Just like with the early days of OpenStreetMap, you don’t want ‘contamination’ by copying information from a source that holds database rights or copyright over the information that you use. So we want cases of people voluntarily typing in their addresses, while the provider collate the raw data. Inherently, the same way that Google crowdsource queries because people are typing it and giving the text to Google for use, so does anyone who type their delivery address in Amazon.co.uk. This is crowdsourced addresses – not copied from an external dataset, so even if, for the aim of error checking the entry is tested against PAF, they are not derivatives. Take all these addresses, clean and organise them, and you should have a PAF competitor that was created by your clients.
So Amazon is already an obvious candidate for creating it from ‘passive crowdsourcing’ as a side effect of their day to day operations. Who else might have a database that came from people inputting addresses in the UK to a degree that the body can create a fairly good address database? It doesn’t take a lot of thinking to realise that there are plenty. Companies that are operating at a scale like Amazon probably got a very high percentage of addresses in the UK. I’d guess that also Experian will have it for their credit checks, and Landmark is in a very good place because of all the property searches. You can surely come with many more. None of these companies is offering a competition to PAF, so that tells you that commercially, no private sector company is willing to take the risk and innovate with a product. That’s understandable, as there is the litigation risk from all the messy group of quasi-public and private bodies that see addresses as their intellectual property. The end result: there is private sector provision of address database.
And all the while, nobody is daring to think about nationalising the database, force, by regulation and law that all these quasi-commercial bodies work together regardless of their ways of thinking. And it’s not that nationalisation is impossible – just check how miraculously Circle Healthcare is ‘exit private contract‘ (because the word nationalisation is prohibited in neoliberal dogma).
To avoid trolling from open data advocates: I wish the best to Open Addresses UK. I think that it’s a super tough task and it will be great to see how it evolves. If, like OSM, one of the companies that can crowdsource addresses can give them their dirty data, it is possible that they build a database fast. This post is not a criticism of Open Address UK, but all the neolibral dogmatic people who can’t simply go for the most obvious solution: take the PAF out of Royal Mail and give it to Open Addresses. Considering the underselling of the shares, there is an absolute financial justification to do so, but that’s why I pointed the sanctity of private companies assets…
So the end result: huge investment by government, failing again and again (and again) because they insist on neoliberal solutions instead of the obvious treatment of commons – hold them by government and fund them properly.