A frame from the movie "The Adventures of Buratino." Belarusfilm, the creative association Telefilm.

Open data and commercial projects

Open data has been discussed for a long time. I personally have been promoting this topic for more than 7 years, and many enthusiasts around the world have been promoting the ideology of openness for almost their entire adult life.
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Yes, open data has many explicit and implicit benefits for community initiatives. Real-time traffic data helps citizens better plan the logistics of their movements. The data of the declarations of officials help to create public projects on the transparency of the civil service and at the same time not to spend huge resources on digitizing and recognizing declarations filled out by hand. There are many more examples of how open data helps citizens and the state.

At the same time, many people have been talking recently about earnings on open data. But every time I hear about this from prominent analysts, I want to ask them: why are you talking about how others can make money, but don’t do it yourself? Where are all those who directly earn on open data? Why are they so non-public? Why are project owners and creators so rarely presented to the general public?

The reasons are many, and I will give only some of them:

• entrepreneurs do not want to attract the attention of competitors and officials. When representatives of real projects begin to talk about how they earn, they attract attention and competitors, and those who provide them data (officials). There are compelling concerns that officials will not open the data, but, on the contrary, will look for ways to make them not completely open, so as to remove the rent from those who want to get this data,
• The media does not like to write about commercial projects on the data. Russian media rarely write about startups based solely on the information business. Repacking information into services and their subsequent sale requires an understanding of where the data comes from and what to do with them. There are few technological journalism in Russia, and even fewer journalists willing to write about startups based on open data
• business knows nothing about open data. Strangely enough, but the creators of many projects that earn money on data do not know that this is “open data”. Some of them use databases collected from state sites since the beginning of the 2000s, and during this time their business model has changed slightly. Instead of unloading databases, scrapping and repacking of information from web pages into databases is used.

In the world, open data cases are under active consideration. There are two iconic projects - OpenData500 and Open Data's Impact . They collect examples of how open data benefits and changes the world. Both projects are the result of research by The GovLab, a small expert center.

In Russia, no one has ever conducted such research. Strange as it may seem, but for all the existence of the Open Government (and simply the Government of the Russian Federation), there was no time and resources to finance such work.

But we, in Infoculture, somehow deal with this topic and are working on our own report on the openness of financial data in Russia. What will go there?

Who and how earns on public public financial data?

It is no secret that a lot of financial data is published in Russia. And most of this data is published by the authorities. These include the Ministry of Finance of Russia, the Federal Treasury, the Federal Tax Service and, in part, the Central Bank, which is formally not an authority, but an authority with strong state influence on it.

What data is published?

• Government procurement, government contracts, procurement plans, tender documents and many other bases on this topic;
• Budgets, draft budgets, data about organizations - participants of the budget process;
• Tax, budget and financial statistics;
• Data on government debt, sovereign obligations, funds, etc.

This data is very, very much. But how to find those who use them? How to understand how much they earn from it?

In a number of topics it is almost impossible. For example, the Ministry of Finance maintains and makes publicly available the official register of audit organizations .

How to find out how much profit this register brings to Yandex, which has a section “Auditing organizations in the Yandex.Readership” or the “Audit-it” project, which keeps a register of auditing organizations? With a high degree of probability, it is impossible to answer this question, since this data is supplemented by others and mixed to create new products or to integrate into existing ones.

Therefore, as a first approximation, we decided to consider projects on open financial data in the field of public procurement.
We analyzed 48 Internet projects using open procurement data and contracts. Of these, 16 we dropped because of any lack of output data and examined in detail 32 commercial and non-commercial products for which contacts and details of the organizations that created and sell these products are available.

Here are the business models we discovered:

• search and subscribe services for purchase announcements for suppliers;
• business intelligence services and counterparty checks;
• services for monitoring average prices for customers and suppliers;
• services for government customers on the calculation of the initial maximum price;
• marketing research services;
• performance of work on government contracts requiring a base of government procurement and government contracts;

As a result, all the analyzed projects were classified by us into the following categories:

Category	Number of projects
Services for searching tenders and arranging suppliers for purchase announcements	nineteen
Verification of information about counterparties	five
Analysis of average prices and the establishment of the initial maximum price	five
Social control	3

Two types of companies were identified using open government and municipal expenditure data.

The first type of companies includes enterprises whose business model and revenue are based only on open data - the use of these data is an integral part of their business. For example, projects such as Purchasing360 and TenderLand, providing tender subscription services.

Companies that use open data as an essential addition to already existing commercial products belong to the second type of companies, however, in their absence, they can still continue to develop their own products.

The results of the study revealed the following indicators:

• about 500 million rubles - an expert estimate of the revenue of all companies earning only on open data of public procurement and government contracts,
• from 200 to 500 million rubles - an expert estimate of the revenue of companies for checking counterparties using trading data.

The total expert estimate of the revenue of companies using open data on state and municipal expenditures is about 1 billion rubles.

We are talking about, for example, products such as FIRA, Spark. Interfax and Contour. Focus that allows you to verify counterparties, including information about their purchases and contracts.

We will publish a complete list of companies and their business models by the time we complete our report. In the meantime, the question is, what other projects are there in the world and what to do in Russia?

Foreign projects

If in Russia commercially successful projects and products on open financial data are concentrated in the field of government order, then in other countries there is greater diversity. Projects such as ClearGov and OpenGov are focused on SaaS solutions for visualizing budget data for municipalities in the United States. These are small startups focused on high-quality visualization of budget data. Or companies such as Avalara, who provide software products to automate the filing of tax returns.

Numerous projects use SEC.gov (Securities Commission) data to track information about public companies. Projects like Google Finance and Yahoo Finance are based on this data.

BudgetApps Competition

In Russia, the complexity is not only in order to use the data (it is, but not always available in a convenient form). But also in the search for a starting point for creating your project.

In order to help solve this particular problem, we have been at Infoculture for the second year already helping the Ministry of Finance of Russia in conducting the BudgetApps contest specifically for those who like to count other people's money in order to multiply their own. This year there are nominations for programmers, journalists and designers and there is an opportunity not only to win a prize, but also to draw attention to your project.

Why are we interested in this? Over the past few years, we have been doing a government spending project, in which we not only collect data on government contracts, but also give a convenient interface for working with them, and publish data in the form of API and data sets . For those who want to create new projects, focused not only on money, but also on public control over government spending, our data can be very useful.

However, without distracting from startups and businesses: what ideas in Russia can be in demand and what can be monetized?

Ideas that can be monetized

1. Analogs of ClearGov.com and OpenGov.com. There are more than 24 thousand municipalities in our country and, oddly enough, they can sell visualization services of their budgets. They can also be sold to candidates for governor, mayor and more. These are instruments of politics and public good. Not without benefits for the creators, of course.
2. Cool infographics can be successfully commercialized. And products like Death & Taxes (Timeplots) are one of the very successful examples of monetizing data in the form of real-world objects.
3. Another one-subscription service for tenders. Yes, there are many. But who knows, maybe your service will become the new standard of convenience and openness of public financial data.

Experiment, test, we are ready to help with the consultation, suggest where to take what data and how to work with them. You can start by participating in one of our free hackathons this summer, which will be specially organized to help the BudgetApps contestants decide on a theme and prepare a decent application.