Select Committee on Transport, Local Government and the Regions Minutes of Evidence

Examination of Witnesses (Questions 200 - 219)



Mr Betts

  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 aggressive.


  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.

Mrs Dunwoody

  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 purposes—and 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 mapping—the 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 price—this 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 water—everyone 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.

Mr Betts

  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 organisations?
  (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 satisfactory.

Chris Grayling

  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 sense?
  (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.

Ms King

  211. Talking about the courts and complaining—without wishing to breach the sub judice law—could you give us your view on the principle of the case surrounding Getmapping and Ordnance Survey, and whether you think it is reasonable or not?
  (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.

Chris Grayling

  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 follow.
  (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.

Mr Cummings

  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.

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