Local Database to Become a Commodity?

TechCrunch, seemingly unaware of the the larger context of its suggestion, asserts that it’s time for an “open database of places.” This emerges logically out of the proliferation of local-mobile applications and the common-sense desire to have access to a single, accurate database of local businesses and points of interest (POI) that developers can rely upon. Trouble is, as TC points out, data is frequently regarded as a strategic asset.

Indeed, it is . . .That’s why the Telcos fought all the way to the US Supreme Court (Feist v. Rural Telephone Company (199)” to prevent third parties from gaining easy access to it. Feist made possible the various local databases that exist today and many of the sites that rely on local data. Without this decision there would likely be no Yelp or Foursquare.

This “open database” concept is different version of a similar conversation I had earlier this week with Localeze. We discussed the possibility that the local database would eventually become a “commodity.”

Placecast’s new Match API is an effort to reconcile all the conflicting local data being used by a growing number of players. If it gains widespread usage, what may emerge is a unified local database that can be “re-syndicated” for free or low cost. Regardless of whether this is the precise vehicle, the market is moving toward what TechCrunch is suggesting.

The three main local data providers, InfoUSA, Acxiom and Localeze, are trying to build enhanced datasets or developing new services on top of the base local data. (I wrote about this in the context of Localeze last week.)

All of them recognize that a time is coming when the local and POI data will be widely available for less money than it takes to access it today. Google, for its part, sees this data as strategic and so is collecting more of it itself (via Street View and UGC) and relying less and less on third parties (e.g., TeleAtlas). It’s possible too that Google would at some point seek to be that local data source. Witness the effect Google Navigation — which motivated Nokia to make its navigation free — has had on the PND/GPS market.

From the business side, it would also be great if there were a single database into which local businesses, national chains and other interested parties could enter, correct and enhance their information. However, despite several efforts toward this objective, it remains elusive. No single private company has been able to be the “single point of entry” or syndication for local data.

An effort to create a Wiki-based global directory of local businesses initially failed in the form of Yellowikis. Since that time Brownbook and Bizwiki have emerged, but they are destinations rather than open data providers. Citysearch is aggressively re-syndicating its local data and content though not providing an open database in the sense that TechCrunch is calling for.

Clearly the market wants a free or low-cost local database. So something will emerge that responds to that demand. The questions are:

• When?
• How will its accuracy be established and maintained?
• What’s the business model to support it (e.g., donations, licensing)?

Bad local data can kill a local site or app. Conversely, giving everyone equal access to the same local data would not necessarily make all apps or sites equal; however it would put considerable pressure on the UI/UX and other variables to differentiate.

What do you think about all this and whether an “open local database” will come to pass?

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Related from TC: CloudMade’s OpenStreetMap Surges On Wikipedia-Like User Passion

While this isn’t the same as local business data, perhaps it’s a “proof of concept” for an open-source local database.