Canada Post’s War on the 21st Century, Innovation & Productivity

The other week Canada Post announced it was suing Geocoder.ca – an alternative provider of postal code data. It’s a depressing statement on the status of the digital economy in Canada for a variety of reasons. The three that stand out are:

1) The Canadian Government has launched an open government initiative which includes a strong emphasis on open data and innovation. Guess which data set is the most requested data set by the public: Postal Code data.

2) This case risks calling into question the government’s commitment to (and understanding of) digital innovation, and

3) it is an indication – given the flimsiness of the case – of how little crown corporations understand the law (or worse, how willing they are to use the taxpayer funded litigation to bully others irrespective of the law).

Let me break down the situation into three parts. 1) Why this case matters to the digital economy (and why you should care), 2) Why the case is flimsy (and a ton of depressingly hilariously facts) and 3) What the Government could be doing about, but isn’t.

Why this case matters.

So… funny thing the humble postal code. One would have thought that, in a digital era, the lowly postal code would have lost its meaning.

The interesting truth however, is that the lowly postal code has, in many ways, never been more important. For better for worse, postal codes have become a core piece of data for both the analog and especially digital economy. These simple, easy to remember, six digit numbers, allow you to let a company, political party, or non-profit to figure out what neighborhood, MP riding or city you are in. And once we know where you are, there are all sorts of services the internet can offer you: is that game you wanted available anywhere near you? Who are your elected representatives (and how did they vote on that bill)? What social services are near you? Postal codes, quite simply, one of the easiest ways for us to identify where we are, so that governments, companies and others can better serve us. For example, after to speaking to Geocoder.ca founder Ervin Ruci, it turns out that federal government ministries are a major client of his, dozens of different departments using his service including… the Ministry of Justice.

Given how important postal code data is given it can enable companies, non-profits and government’s to be more efficient and productive (and thus competitive), one would think government would want to make it as widely available as possible. This is, of course, what several governments do.

But not Canada. Here postal code data is managed by Canada Post, which charges, I’m told, between $5,000-$50,000 dollars for access to the postal code database (depending on what you want). This means, in theory, every business (or government entity at the local, provincial or federal level) in Canada that wants to use postal code information to figure out where its customers are located must pay this fee, which, of course, it passes along to its customers. Worse, for others the fee is simple not affordable. For non-profits, charities and, of course, small businesses and start-ups, they either choose to be less efficient, or test their business model in a jurisdiction where this type of data is easier to access.

Why this case is flimsy

Of course, because postal codes are so important, Geocoder came up with an innovative solution to the problem. Rather than copy Canada Post’s postal code data base (which would have violated Canada Post’s terms of use) they did something ingenious… they got lots of people to help them manually recreate the data set. (There is a brief description of how here) As the Canadian Internet Policy and Public Interest Clinic (CIPPIC) brilliant argues in their defense of Geocoder: “The Copyright Act confers on copyright owners only limited rights in respect of particular works: it confers no monopoly on classes of works (only limited rights in respect of specific original works of authorship), nor any protection against independent creation. The Plaintiff (Canada Post) improperly seeks to use the Copyright Act to craft patent-like rights against competition from independently created postal code databases.”

And, of course, there are even deeper problems with Canada Post’s claims:

The first is that an address – including the postal code – is a fact. And facts cannot be copyrighted. And, of course, if Canada Post won, we’d all be hooped since writing a postal code down on say… an envelop, would violate Canada Post’s copyright.

The second, was pointed out to me by a mail list contributor who happened to work for a city. He pointed out that it is local governments that frequently create the address data and then share it with Canada Post. Can you imagine if cities tried to copyright their address data? The claim is laughable. Canada post claims that it must charge for the data to recoup the cost of creating it, but the data it gets from cities it gets for free – the creation of postal code data should not be an expensive proposition.

But most importantly… NON OF THIS SHOULD MATTER. In a world of where our government is pushing an open data strategy, the economic merits of making one of the most important open data sets public, should stand on their own without the fact that the law is on our side.

There is also a bonus 4th element which makes for fun reading in the CIPPIC defense that James McKinney pointed out:

“Contrary to the Plaintiff’s (Canada Post’s) assertion at paragraph 11 of the Statement of Claim that ‘Her Majesty’s copyright to the CPC Database was transferred to Canada Post’ under section 63 of the Canada Post Corporation, no section 63 of the current Canada Post Corporation Act  even exists. Neither does the Act that came into force in 1981 transfer such title.”

You can read the Canada Post Act on the Ministry of Justice’s website here and – as everyone except, apparently, Canada Post’s lawyers has observed – it has only 62 sections.

What Can Be Done.

Speaking of The Canada Post Act, while there is no section 63, there is a section 22, which appears under the header “Directives” and, intriguingly, reads:

22. (1) In the exercise of its powers and the performance of its duties, the Corporation shall comply with such directives as the Minister may give to it.

In other words… the government can compel Canada Post to make its Postal Code data open. Sections 22 (3), (4) and (5) suggest that the government may have to compensate Canada Post for the cost of implementing such a directive, but it is not clear that it must do so. Besides, it will be interesting to see how much money is actually at stake. As an aside, if Canada were to explore privatizing Canada Post, separating out the postal code function and folding it back into government would be a logical decision since you would want all players in the space (a private Canada Post, FedEx, Puralator, etc…) to all be able to use a single postal code system.

Either way, the government cannot claim that Canada Post’s crown corporation status prevents it from compelling the organization to apply an open license to its postal code data. The law is very clear that it can.

What appears to be increasingly obvious is that the era of closed postal code data will be coming to an end. It may be in a slow, expensive and wasteful lawsuit that costs both Canada Post, Canadian taxpayers and CIPPIC resources and energy they can ill afford, or it can come quickly through a Ministerial directive.

Let’s hope that latter prevails.

Indeed, the postal code has arguably become the system for physical organizing our society. Everything from the census to urban planning to figuring out where to build a Tim Horton’s or Starbucks will often use postal code data as the way to organize data about who we are and where we live. Indeed it is the humble postal code that frequently allows all these organizations – from governments to non-profits to companies – to be efficient about locating people and allocating resources. Oh. And it also really helps for shipping stuff quickly that you bought online.

It would be nice to live in a country that really understood how to support a digital economy. Sadly, last week, I was once again reminded of how frustrating it is to try to be 21st century company in Canada.

What happened?

Directives
  • 22. (1) In the exercise of its powers and the performance of its duties, the Corporation shall comply with such directives as the Minister may give to it.

7 thoughts on “Canada Post’s War on the 21st Century, Innovation & Productivity

  1. Anonymous

    The minister needn’t force canpost to offer the data set free, just tell them not to sue upstarts. Maybe there’s value in the format they have, which people will pay for. Brand value if nothing else.

    Big companies can splash the cash and

    Startups can use unofficial but still practical data sets.

    Reply
      1. neil21

        My pleasure. It was written on the bus this morning so I cut the formalities, but of course I echo Kenneth in my gratitude for your excellent writing and investigations.

        Reply
  2. Guest

    I have invented a new system for uniquely identifying sides of streets in Canada. It is called the Open Address Code. Format and value of these codes is identical to a Postal Code(tm), but this is not a Postal Code(tm). Licence: Do whatever you want with it.

    Problem solved?

    Reply
  3. Pingback: Open Postal Codes: A Public Response to Canada Post on how they undermine the public good | eaves.ca

  4. Alogon

    Seems like a poor understanding of copyright law here on all sides.
    CIPPIC’s argument is not “brilliant”, it is ridiculous. It amounts to saying that I am not violating J.K. Rowling’s Harry Potter copyright is I make my book, Larry Cotter, entirely by having other people read me excerpts of her bbok and then copying the verbatim.
    Second, postal codes are not “facts”, that is akin to saying that, going back to my J.K> Rowling example, that Harry Potter being a magician is “fact” and therefore is open for me to write about him without paying the creator. Postal Codes are a codex entirely conceived and managed by Canada Post. The sun orbiting the earth is a fact, postal codes existing does not then make them a “fact” and not subject to copyright. A Postal Code may relate to a certain facts but, again, to use your argument then the Encyclopaedia Brittanica is not copyright because it contains “facts” and because it is a “fact”, being that it exists?

    Reply

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