Canada Post vs Geolytica: It’s not about Copyright

Here are my thoughts on Canada Post’s claim to copyright over postal codes.

(Full disclosure: I’m a member of the Canadian Postmasters and Postmaster’s Assistants Association, although I’m not an active employee, I haven’t worked there in several years, and I do not rely on Canada Post for financial remuneration in any way. The views presented here are in no way reflective of Canada Post’s official position. I’m also not a lawyer, in case that wasn’t already obvious.)

Background: Canada Post is currently suing Geolytica over use of the postal code database. Canada Post claims that it holds copyright over postal codes, and that Geolytica’s creation of their own alternative database is a violation of that right.

First of all, I think it is questionable whether Canada Post (CP) owns copyright over postal codes. I’m not sure whether postal codes can even be copyrighted. (“They’re facts” is the justification that I’ve been seeing for this position, and I tend to agree.) So derivatively I think it is wrongheaded for CP to defend against encroachment from companies such as Geolytica based on the assumption of copyright.

However, I do very strongly think that postal code databases require central control. CP already makes their database available for commercial use at a cost (arguments about whether that cost is fair aside, for a moment). Postal code lookup for the public is free – there’s even “an app for that” available on iOs, Android and even Blackberry smartphones. The use of a copyright claim to my mind is really a proxy for the substantive issues surrounding CP’s claim:  who gets to control the postal code database, and who gets to profit from it.

First, the issue of control. By maintaining central control over the postal code database, CP ensures security and reliability. When you send a letter or a parcel, you use CP’s official postal code and you can rest assured that it is correct and that your package will arrive at the correct destination. If a range of unauthenticated databases were to arise, such as the one offered at Geocoder.ca, the potential for abuse also rises. Without proper oversight, what is to stop a malicious user from inputting incorrect postal codes, even just temporarily, to redirect mail to the wrong location?

An appropriate analogy would be the Domain Name System (DNS) used for directing Internet traffic requests. When you type in a website’s name, such as “www.google.com”, your browser queries one of a dozen or so trusted DNS databases to match the human readable name (google.com) to its machine readable IP address. Without this matching system, Internet users would have to remember a huge number of long and confusing IP addresses. For example, Google holds a range of IP addresses like the following:

•   66.102.0.0 – 66.102.15.255

  • 66.249.64.0 – 66.249.95.255
  • 72.14.192.0 – 72.14.255.255
  • 74.125.0.0 – 74.125.255.255
  • 209.85.128.0 – 209.85.255.255
  • 216.239.32.0 – 216.239.63.255

Imagine if you had to pull out a list of all those numbers every time you wanted to google something! And further, imagine if someone switched those numbers with the intention of sending you to a fake google designed to rip you off in one way or the other.

The postal code system works in a similar way. Someone wishing to send a letter just has to know the name and street address of the intended recipient to be able to look up the corresponding postal code from a trusted database.

The DNS system, which manages web site addresses in much the same way as postal codes manage physical addresses, is centrally controlled by the United States government. The central database is called the “root” file, and the US government is said to have root authority.

The importance of DNS root authority was made explicit in 1998. In a contest for control over the root, Jon Postel, the “father of the Internet” attempted to assert control over the root database files by having them recognize his central server as the authority. Postel’s intentions are generally thought to have been beneficent, but the US government, under the direction of Clinton’s Internet czar, Ira Magaziner, intervened for reasons of security and reliability.

Fearing that someone with intentions less benign than Postel could seize control of an uncontrolled root database, potentially breaking the Internet or at least causing financially damaging mischief, Magaziner forced Postel to transfer exclusive control of the root authority to the US Government, where it remains today. The DNS database that links website names to actual numerical addresses was deemed too important to allow decentralized control.

In essence, Canada Post’s legal action against Geolytica’s unauthorized use and modification of the postal code database is an assertion of “root authority”. With the successful delivery of all Canadian letters and parcels at stake, it is not hard to understand why such an important database requires central and accountable oversight. A database that is relied upon so heavily by Canadians for postal commerce and communications could have devastating effects in the hands of someone with malicious intent. It is absolutely imperative that control over this database remain central; the widespread availability of alternate databases would create an all-too-easy opportunity for mischief and abuse.

The second issue in CP’s claim against Geolytica has to do with who can access – and thereby profit – from use of the postal code database. This is less clear cut than the issue of control. As it stands, CP is a crown corporation that does not accept taxpayer money to operate. Its costs are recovered from the services it offers. One of those services is commercial access to the postal code database; companies have to pay to use this service. Regular private citizens do not have to pay to look up a postal code.

Under the current system, a company that wants to make a profit by using the postal code database has to pay CP for access. Those fees go towards keeping the cost of stamps and parcel fees down. As well, they go towards the salaries and benefits of CP’s employees. If companies like Geolytica create alternative postal code databases, that means that other companies wanting to use that information can bypass CP’s database and fees.

This might be a good thing, but first you would have to assume that those databases are as reliable as CP’s – something that’s far from assured. Second, you must realize that the profit resulting from database access will no longer be collected by CP. Again, you might think that this is a good thing; maybe privatization of the mail system in Canada is overdue?

According to the Canada Post Corporation Act, CP operates under the following directive:

(2) While maintaining basic customary postal service, the Corporation, in carrying out its objects, shall have regard to

(b) the need to conduct its operations on a self-sustaining financial basis while providing a standard of service that will meet the needs of the people of Canada and that is similar with respect to communities of the same size;

Source: Canada Post Corporation Act

Companies who would use alternate (sometimes free) postal code databases operate according to a variety of mandates. One of these of course is to make profit. So for-profit companies using alternate postal code databases could bypass contributing to the maintenance of Canada’s mail delivery system. While CP operates under the mandate to provide a quality service for the benefit of the public, private for-profit companies have no such obligation.

So, companies who bypass CP’s database are taking away from CP’s ability to provide quality services and remunerative employment, while there is no guarantee that they will contribute a counterbalancing benefit.

Still, given the ideological preference for free markets that is widespread today, the argument that CP, its employees and its customers should be receiving the benefit of the postal code database may not be convincing to many. Perhaps a system that allows disparate entrepreneurs and innovators to create their own competing services would ultimately result in more benefit for Canadians and “the economy” in general. But it cannot be denied that CP and its beneficiaries will be diminished as a result. This is a choice that must be examined when considering who has access to postal code databases and under what terms they do.

I personally lean towards the view that CP should maintain “root authority” over the postal code database for reasons of security, reliability and public benefit. Their data is already “open” to the public – but if a private company wants to profit from the use of that data, they have to contribute to sustaining the public postal service. By taking legal action against Geolytica, CP is fighting for its survival as a public service. Although making a claim to copyright over postal codes may be the wrong avenue, if its control over the postal code database proves futile, CP’s role as a vital provider of quality services for Canadians will be eroded, and replaced by a hodge-podge of private companies competing for profit, with questionable regard for the public good.

Whether or not you think that private industry is more desirable than public, the fact that CP will have to find alternate sources of revenue if it can no longer benefit from exclusive control of postal code data must enter into consideration. This likely means higher postage rates, increased downward pressure on employee wages and benefits, and potentially a “worst case scenario” of complete postal privatization should CP fail to find a sustainable alternative revenue model.

This debate ultimately boils down to this one issue: Canada Post relies on contributions from businesses that use its services to continue operating. Should private industry be allowed to reap the benefits created by CP without having to contribute? If Canada Post is forbidden from charging commercial businesses for access to its data services, a recursive negative impact will be felt in the quality and cost of services it provides to Canadians, and its continued existence will be threatened.

Personally, I’d rather rest assured knowing that companies profiting from the use of postal code databases are forced to contribute to the maintenance of the postal system. Canada Post has provided reliable, affordable service to Canadians since 1867. Destroying its revenue model could potentially lead to the irrevocable loss of a trusted Canadian institution.

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4 comments

  1. waltermiller · ·

    The “central control” argument is a non-issue. No one will ever consider the geocoder.ca list to be the authoritative document.

    Next, your individual/business split is nonsense.

    Individuals don’t have to pay to look up a single postal code, neither do businesses.

    If businesses want to map postal codes to a latitude and longitude they have to pay around $50,000. And so do individuals.

    This has some nasty side effects. Independent research becomes impossible.

    The public good benefits from geocoder.ca.

    1. If the creation of third party databases is not meant to be authoritative, what purpose could they serve? Besides, geocoder’s database is meant to be authoritative. Their website states:

      “We strive to provide the most reliable and accurate geocoding services for Canada and the USA.”

      If that’s not a statement of authority, I’ll eat my hat.

      If commercial use by individuals/businesses is the goal of accessing the data, why shouldn’t whoever wants to profit from this data, be they business or individual, have to contribute to the database’s upkeep?

      Where have you obtained this figure of $50,000? The most expensive data service option listed on CP’s business website (http://www.canadapost.ca/cpo/mc/business/productsservices/mailing/pcdp.jsf) is $10,625/year. The combined price of all CP’s postal code data services according to their site is less than half of your figure, although as I understand it the $10,000 data set includes the others.

      How exactly does having to pay for data make “independent” research impossible? CP already distinguishes between commercial and non-commercial use of their data in their licensing agreement.

      There are potential public benefits to be had by making this data available freely, but at the cost of squeezing CP’s revenue. These benefits/costs have to be weighed against each other.

      Lastly, geocoder.ca sells the data that they collect. They are attempting to establish a competing service. They do not exist solely for the “public good”.

  2. The root authority argument is a good one, but it’s not the one Canada Post is making, at least not primarily, and that I think will ultimately lead to their downfall in this. They’re fighting the wrong fight.

    Comparing the postal code db to Domain Name Service is also apt, but I’d like to point out that although tightly controlled DNS addresses are not copyright or trademarked, and an alternate DNS system is not illegal — see http://www.opennicproject.org/.

    1. The future’s not looking too bright for the postal service in general…

      I agree that copyright is the wrong avenue. CP appears to be grasping at straws in this case.

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