Examination of Witnesses (Questions 200
TUESDAY 19 MARCH 2002
200. You are saying there is a need for a monopoly
doing certain functions, but a concern that Ordnance Survey can
just go off and act in any field with an advantage over the commercial
operators? What is the solution if that is the problem; what is
the solution to that situation?
(Mr Nicholson) I think there are no easy solutions.
I could give you a trite solution, but I think this is something
which needs careful consideration. Could I give you my trite solution
in just a few words, because clearly this thing could be the subject
of discussion for hours. I believe that Ordnance Survey should
own the framework and manage the framework and be the key mover
in setting standards for cartography in this country; I think
it should do the survey work. I think there are several key functions
that it should do. I question whether it should move a long way
beyond that role. I think, personally, we do not want the situation
which you have in the States where mapping actually has degraded,
because mapping from the centre is not being adequately done in
depth. I would like to see Ordnance Survey very strong in cartography
and very strong in survey, but benign rather than commercially
201. Who pays for it?
(Mr Nicholson) I think we should pay for it. I think
the public should pay for it. I have no hesitation about that.
I do not believe that the freedom of access to information is
the same as free information. I believe we should pay for it.
I have no concerns about Ordnance Survey making a profit either.
202. Are you talking about "we" as
taxpayers or "we" as individual buyers of the service?
(Mr Nicholson) This is a personal view, but I believe
that buyers of the service should bear the load. I think it is
difficult to explain to my 92 year old mother that she might need
a map and that she is paying for it out of tax. I would personally
prefer to pay for it myself when I needed one.
203. Would she be altogether delighted if she
then had to pay what would be an economic rate for that map?
(Mr Nicholson) I would be delighted to pay
an economic rate for that; she would be appalled!
(Mr Roper) I think there is a real problem which has
arisen, because with the mapping that Ordnance Survey produces
for engineering purposesand in engineering applications
there is no problem about the pricing, it is not expensive in
relationship to the things that engineers and surveyors want to
do with that mappingthe problem arises that that mapping
could be used for many other purposes. In a networked world there
becomes a real problem when that mapping becomes freely available
through some other channel, when at that point the people certainly
are not prepared to pay the money; it would not be worth it to
them in the way it is worth it to an engineer or a surveyor; and
so there is pressure within government, particularly through some
of the new e-services that government wants to provide to the
citizen perfectly reasonably and properly. I would not agree that
there was any single right price or economic pricethis
is an arbitrary value that is put on it, but at that point if
you are giving it away free in one place you cannot charge for
it in another. It is like watereveryone will go to the
free tap, rather than the expensive tap. Therefore, there tends
to be an artificial constraint on the way Ordnance Survey's mapping
can be used.
204. You talk about the monopoly position that
Ordnance Survey has. When we talked to their senior executives
they actually deny that and say it really is not a monopoly. Do
you think that is a concern, that they do not recognise that?
(Mr Nicholson) It has to be. I think it is an enormous
concern, because if it is really how they feel about it then it
seems to me it is quite difficult to run their business. The first
thing must be to consider the sort of organisation you are and
the environment in which you are operating, and only then can
you really formulate your business plan. If they genuinely do
not believe they are a monopoly (and my opinion is that they are)
then I think it is quite difficult for them to forward plan.
205. Currently they act as regulator, supplier
and competitor. Does that make life impossible for commercial
(Mr Nicholson) No, it does not. I think what makes
life difficult is uncertainty. I think that if one said they are
regulator, competitor and so forth, you can live with that on
condition you do not invest a £1 million, £2 million
or £10 million in something and suddenly discover that actually
Ordnance Survey has decided that looks like a good field to plough
and they have decided to move into that themselves.
206. How do you stop that? Either they are going
to keep out of the areas where they are going to be competing
with the private sector; or if they are in their little bit you
cannot then be in there a little bit and never change, because
the world changes and they are bound to respond to changes?
(Mr Nicholson) I would say the answer is a sort of
caveat emptor situation; where you draw a boundary and
say, "That is the area of operation we perceive Ordnance
Survey should correctly be doing in the national interest, for
the benefit of industry, government and so forth, and if you venture
into that area then you are potentially venturing into an area
where there will be competition". I think that is perfectly
207. Where do you draw the boundary?
(Mr Nicholson) Personally I would like to see it as
being guardian of the national master map. I would like to see
it as a surveying base. I would like to see it as the organisation
which sets the standards in consultation with government, in consultation
with the private sector; and an organisation which sells the resultant
maps and digital information.
Sir Paul Beresford
208. Where do you see the private sector's role?
(Mr Nicholson) The private sector's role could be
in all sorts of additional information to do, for example, with
location-based services; to do, for example, with aerial photography;
to do, for example, with the way some of that data is interpreted
and added to others.
(Mr Roper) With added value. We have worked with Ordnance
Survey for the last seven years and we add value to that mapping
in a variety of different ways, by adding other data, the data
sets. I agree with Michael, the worst thing is disruption. We
need to plan our business two, three or four years ahead, like
any other business. If the complete landscape is going to change
because government has changed or Ordnance Survey has changed
its business plan, that can give us problems. I would agree, I
would like to see some outside body, somebody outside Ordnance
Survey, deciding whether this was in the national interest and
where the boundary lies. I do not think it is right for us to
try and set the boundary, any more than it is right for Ordnance
Survey. I should not be able to say, "Hey, Ordnance Survey,
you can't do that"; but there must be a boundary between
private and public, because I would agree that Ordnance Survey
is in a monopoly position and I think there has to be some independent
regulation which sets where that boundary is. It is not fair to
ask either of the players to also be the umpire. We cannot do
it, because all we will do is fight our corner, and that can end
up very close to litigation, especially at a time of very rapid
change and development of Ordnance Survey's role.
209. Should there not be a cross-flow of techniques
between Ordnance Survey and, if you like, the competitors? I am
just thinking about the way in which maps of mountaineering areas
have developed over the last 100 years. Ordnance Survey did most
of the survey work and did it on the basis of contours, but Bartholomew
and, more recently, Harvey have demonstrated that you can put
in colour shading which probably means that the walker has more
idea whether they are going up a mountain which is steep than
they did just from the contour lines. Once Ordnance Survey has
seen the way in which those private map makers did it rather more
effectively they then followed their lead. Does that not make
(Mr Roper) I think the digital world has changed the
rules of the game rather. You can see in France where with walkers'
maps you have got a lot of competition at that median scale. When
you have digital data, which can be taken and merged into other
products, I think you have a much harder job in keeping different
products apart. The boundaries are much harder to regulate than
they were in a paper publishing world.
210. I accept they are harder to regulate, but
should there not be that cross-flow of information? You should
not complain if Ordnance Survey copies some of the techniques
and ideas that come from the private sector?
(Mr Roper) What can I say? I think there should be
an umpire somewhere, given the size of the Ordnance Survey. They
are my sole supplier; I have nowhere else to go. We invested large
amounts of money in good faith because we were told these were
the rules of the game. I think it would be unreasonable if Ordnance
Survey then changed the rules and I have nowhere, other than the
courts, to complain to.
211. Talking about the courts and complainingwithout
wishing to breach the sub judice lawcould you give
us your view on the principle of the case surrounding Getmapping
and Ordnance Survey, and whether you think it is reasonable or
(Mr Roper) I cannot.
212. I think that is probably a dangerous area
to go into.
(Mr Roper) The only thing I would say about it is
that I think this kind of problem is going to occur again, without
there being any villains or any good or bad guys. I think it is
inherent in the lack of an independent umpire.
213. Do you think an independent umpire would
be better than the courts?
(Mr Roper) Yes, undoubtedly.
214. Could I probe Mr Nicholson on this area
between the role of Ordnance Survey as the public custodian and
also as information supplier. Can you tell us a bit about the
practical problem that causes within the business?
(Mr Nicholson) I think, first of all, it causes a
problem of investment, and Christopher has just described one
situation. I suspect he is not in a position to be entirely frank,
because you develop a technique in the expectation of something
happening. It happens and then your main supplier changes their
stance potentially in the way they supply data and suddenly you
are at a disadvantage. If we look back to the principle of Getmapping,
potentially there is a similar situation here. It goes back to
what is expected of Ordnance Survey. Ordnance Survey is, as the
Quinquennial Review says, expected by the Government to be more
commercially focused in its dealings with the private sector and
more cost-effective in its dealings with the public sector. Well,
that is easy to say, but if I were the Director General, what
I would be saying to myself is, "I have got to be competitive,
more effective, more aggressive in the way I do things".
Most of the players in the GIS industry in this country are relatively
small and they do not have deep pockets and they are certainly
not in a position to compete with an organisation of the size
and with the database of the value of Ordnance Survey.
215. So what is your view of the proposal that
Ordnance Survey becomes a plc, a government-owned plc?
(Mr Nicholson) I feel extremely uncomfortable with
it. I do not think it was well considered in the Quinquennial
Review. I think that the Quinquennial Review said a number of
sensible things, one of which was that it felt that Ordnance Survey
had not been a trading fund for long enough for the case of a
trading fund to be proven or otherwise, but the rationale for
moving to a GO plc was, interestingly, one of the shortest paragraphs
or sections in the Quinquennial Review and it brought forward
reasons which leave me feeling very uncomfortable.
216. So do you think that the Quinquennial Review
looked at the issues in enough depth or not?
(Mr Nicholson) I do not. I think that, first of all,
if you are doing a Quinquennial Review, it seems to me that you
have to start from the consideration of the sort of trading environment
which the organisation exists in, so although it acknowledged
that OS was a monopoly in several places, it did not actually
investigate and consider the impact of that. Therefore, it did
not touch on regulation as far as the outside world was concerned,
but it looked at regulation simply as far as government is concerned.
It also accepted, it seemed to me, the Ordnance Survey business
plan as read rather than questioning whether in the trading environment
in which it exists it was in fact a reasonable business plan to
(Mr Roper) We are agnostic about whether it is a GO
plc or a trading fund, and there are two issues that I can see,
one of which is the regulatory issue and the other is I do think
that the Government has been remiss in not being better at defining
what it wants from Ordnance Survey, so I do not altogether blame
Ordnance Survey for the situation that has been created because
I think the problem is with its political masters. They should
have decided what it is that they want Ordnance Survey to produce
and if it becomes a GO plc, before it becomes a GO plc they had
better get it absolutely clear what it is they want from it. I
think there are the wider issues that Mark Linehan referred to
which have nothing to do with the geometry of surveying, but have
to do with location-based services and all the other things that
we may want in the future to provide to the citizen, and they
had better know that before it becomes a GO plc because it will
be more independent, not less independent of government when that
has happened, and I am not convinced that we will be pleased with
the results in ten years' time.
217. You mentioned America and France this morning.
Has any country got the relationship right?
(Mr Roper) Lots of countries have got bits of the
question right. I would not say there was an ideal, and you could
pick and choose. I think the Tiger Files in America have worked
extremely well. Are you familiar with the phrase? The Tiger Files
is the mapping that is produced every ten years for the Census
at the cost of government. It is part of the expense of doing
the Census. The data is then made widely available. It does not
provide all the geometry, but it does provide the topologically-accurate
road network, together with all the number ranges of houses along
it, and there is a huge industry in America adding value to that
mapping. Now, I actually believe that we are going to need something
like that for Europe within a relatively short time and I think
it would be interesting if we had something like that for the
United Kingdom and Ireland.
218. Mr Nicholson, you wanted to add just three
points, but briefly as we are tight for time.
(Mr Nicholson) I will be very brief. The three points
are, first of all, that if we move to a GO plc, I do not really
know if anyone can possibly move back from a GO plc to a trading
fund if it appears inappropriate, so actually this is not a step
to be taken lightly. Secondly, if you look at the reasons that
were given for becoming a GO plc, one of them, it seemed to me,
inevitably was going to increase salaries and thus the cost base
of Ordnance Survey. So I know that the Director General feels
that a GO plc would not put up the prices of its products, but
it does seem to me that if your cost base rises, then your prices
may follow. The third thing is that I have a press release here
describing the terms of reference of the next stage of the Quinquennial
Review. They are very introspective in the sense that they are
looking more at how, as a GO plc, the Ordnance Survey should conduct
itself vis-a"-vis its stakeholder, the Government,
rather than, given new commercial freedoms, how it should conduct
itself as against the outside world and the private sector.
219. AGI have suggested to the Committee the
possibility of Ordnance Survey operating as a plc with its shares
distributed across to the organisations currently generating public
sector and utility parts of Ordnance Survey revenues. What are
your views on this option?
(Mr Roper) I would come back to thinking that you
have still got to decide what it wants to do. I think that would
lead to probably a number of conflicts as each of the stakeholders
wanted Ordnance Survey to do something slightly different. We
already have conflicts around other areas of datasets, around
addressing between three different government bodies, Ordnance
Survey, Consignia and the Local Government Information House.
I think you would multiply the conflicts around Ordnance Survey
if you did that. I think it would add confusion and uncertainty
and not the stability that people like me want.