Geographic Information Systems: An Introduction, 3rd Edition

20.2 Cost Recovery and Pricing

Cost-recovery methods are normally used to determine commercial prices for public data. Prices are thus expected to cover such costs as data establishment, storage, and distribution. The price is usually dependent on the quality of the data with regard to detail, timeliness, completeness, topological continuity, and so on. In many countries, price is also dependent on usage (application). Thus, some national mapping authorities set lower usage fees for the public sector's use of data and higher fees for commercial uses in the private sector. Correct pricing, however, is difficult. High prices encourage users to compile their own digital map data, which then reduces the importance of the public sector. Low prices can result in data not being kept up to date because of failure to cover costs, and the value of quality data is not appreciated.

We have already seen that the United Kingdom and Canada enforce copyright regulations with corresponding fees/pricing based on the cost-recovery principle. In 1996, the United Kingdom had a total cost-recovering rate of 70 to 80% for the Ordnance Survey. A number of other European national mapping authorities (Norway, Sweden) have a cost recovery rate of 30 to 40%. In the United States, national data are available only for payment of copying and distribution costs, and cost recovery is thus quite low. The general impression today is that there is little point in a cost recovery rate of 100% for public data. There ...