New publication in Riigikogu journal

Professor Indrek Ibrus published a new essay in Riigikogu’s (Estonia’s Parliament) annual trend-monitoring journal Pikksilm. In this he discusses long term trends affecting media sector including datafication, platformisation and mediatisation, but linked these also to the potentials of decentralisation/blockchain that is relevant also to this project. See the publication here.

blockchain innovation systems Proposal public value Semantic Web Theory

The origins: The initial ideas for the project

This research project titled “The Public Value Chains of Cultural Open Data Solutions” is funded by the Estonian Research Council. This is what the abstract of our original application claimed:

“The project studies the complex ways in which cultural open data solutions could produce ‘public value’. In conceptual terms it builds on Moore’s and Mazzucato’s work on public value, links these to our work on innovation systems in creative industries and investigates how new open data technologies such as the Semantic Web and blockchain could be seen as conditioning the emergence of new innovation systems, how they provide new tools for understanding the functioning of the related public sphere and of industry systems and how public value is produced within these systems. Our work in this project will be both empirical as well as applied, aimed at designing and testing new cultural open data management systems with Estonian Public Broadcasting. The project is highly international (studying multiple case studies across the world) and interdiscplinary (combining network science and data analytics with media and innovation economics, anthropology, information systems design and others).”

And this is how we justified the whole project:

The EU sees open data (OD) as its main instrument for public sector reform and is improving its OD provision (European Union, 2017; European Data Portal, 2018). In parallel, EU and its governments are investing in digitising cultural heritage – mainly with an aim of repurposing heritage so that to arrive at new “value propositions”, especially in educational services (EU Parliament and Council, 2005; EU Commission, 2011; EU Council, 2012). It is expected that public sector and private industries will work together to achieve this. Yet, what kinds of private firms? While global platforms are interested in data about cultural practices their conduct has been seen as a risk (van Dijck et al., 2018; Ibrus and Rajahonka, 2019). European firms again tend to be too small to risk investing in extensive services and, thus, it is the public sector that needs to make these costly early investments (Ongena et al, 2012). This suggests that the public sector produces complex ensembles of public value – provide free resources for public education and invest in data production and management in ways that would motivate third parties to utilise the data to produce both private assets and further public value. The inherent conflicts and challenges are apparent (see also McBride et al. 2019).

This highlights the central interest of our proposed project – to investigate the complex ‘public value chains’ of cultural open data provision. ‘Public value’ concept has been in recent times mainly studied within the public administration (PA) and innovation economics domains. Within PA this has been based on Mark H. Moore’s work (1995) on ‘public value’ as an alternative to the ‘new public management’ approach. In his articulation, public value is what the public most values and what adds quality to the public sphere (Benington and Moore, 2011:14). These two dimensions are interdependent – what is most valuable can be sorted out in a well-functioning public sphere. But the contemporary public sphere is fragmented and constituted by different kinds of institutions, including private media and communications platforms. Articulations of value and what may be produced as such may differ significantly. Thus, Moore and Benington (2011:15) have suggested that public value thinking is about the analysis of these interconnections, interdependencies and interactions between heterogeneous sets of parties operating across multiple boundaries. The role of the government therein is increasingly not one of rule-setter or service provider but of a proactive shaper of the public sphere and creator of value.

Within innovation economics Mazzucato has renewed the critique toward neoclassical economics (NCE) according to which value is subjective, supply and demand regulate the price and the latter is a direct measure of value (Mazzucato, 2018a:65). According to her, NCE leads to an economy of rent-seekers dominated by non-productive value extraction. She suggests that in a digital economy, we can no longer reliably say who creates value and who just extracts it, or how, therefore, the income should be distributed (2018a:71). Mazzucato suggests turning to the classical economists (Smith, Ricardo, Polanyi) who worked on the role of labour in conditioning value.

Considerations of labour – i.e. work towards value creation – would need to include the role of public institutions behind the provision of OD and related cultural services. Mazzucato shows that private capital is not leading in the early and most risky stages of innovation and, therefore, the ‘entrepreneurial state’ needs to step in (Mazzucato 2018b:30). Such public contributions should not be understood narrowly as just provision of ‘public goods’ that have ‘use value’ (in terms of Aristotle), but as active creation of public value – public institutions address what is of value in the public sphere and invest in creating relevant new markets (in the vein of Polanyi 20011944:144). They can do so by supplying new services (such as OD) or commissioning other services (that deploy data). This means that governments can ‘crowd in’ private investments – by creating new markets, they stimulate further activity, labouring towards value by multiple parties that otherwise would not have happened. This phenomenon was evidenced as we studied value creation by Estonian Public Broadcasting (ERR) in the music sector (Ibrus, Rohn and Nani, 2019).

In the context of government evoking new markets the concept of innovation systems (Chaminade 2018; Cooke 2004; Edquist, 2012; Freeman 1995; Lundvall 1992; Nelson 1993) becomes relevant. We have worked with this concept before (Ibrus, 2015a; 2015b) – the work culminated in a book (Ibrus, 2019) that studied the emergence of convergent innovation systems between audiovisual media and other service sectors. We build on Lundvall’s concept of systems of ‘interactive learning’ (1992; 2010) and on the work by Potts et al. (2008, 2011) on creative industries as ‘social network markets’ – as innovation systems consisting of networks of very small firms or professionals (fluid concept) where system coordination takes place in those professionals networking in complex ways, learning from, adapting, modifying and complementing each other’s work and as a result generating incremental innovations that, as they accumulate, may lead to more radical forms of innovation. In such systems institutional diversity is important (Cohendet and Llerena 1997, Johnson 2010, Gregersen 2010, Ibrus 2019) – the inclusion of public institutions such as public service media conditions the diversity of objectives and value propositions that not only secures the system against failures, but creates endogeneous dialogues between alternative views that may eventually produce the most apt solutions – i.e., what the public most values.

To understand value creation in such systems/networks means, therefore, to study the labour contributed by all parties, their interactive learning processes, value articulations, dialogues and system coordination, and how the resulting incremental innovations and their accumulation contribute towards sorting out and producing public value and in which ways, eventually, are the rewards distributed for the production of value.

The role of OD provision in this context is twofold: 1) to use linked data to model activities in the network in order to interpret value creation; 2) to improve further public value creation by making data about networked value creation publicly available.

Aiming to achieve both functions our project focuses on 2 data technologies hailed as the technologies of Web 3.0:

  • Semantic Web (SW) – a set of standards (RDF, OWL, SPARQL) driven by W3C;
  • Blockchain.

SW technologies establish a machine-readable semantic context for every element in the web. That is, they are designed to identify the meanings of everything online in their cultural and social contexts. The problem with such linked data that connect users and producers to each other and to content and services is that they have been monopolised by the largest platforms. The network effects that the platforms enjoy has consequences for how the created value is shared and measured. The privatisation of social data to serve private profits only produces a new form of inequality – skewed access to the generated data and profits (Mazzucato, 2018a:221). In this context the public provision of open data linking cultural producers, cultural practices and content constitutes an alternative strategy with regard to public value generation. In our recent project on cultural metadata, we experimented with such linking (Ibrus and Ojamaa, 2020; also Schich et al 2014; Schich and Meirelles, 2016) and predict that such data tools could enable not only to analyse how in public sphere/cultural innovation system novelties are arrived at, but also who have interacted and laboured to make them happen and ‘what the public values’ in terms of Moore. Yet, in addition to analytics there is value in the use: while there is some work out on the potentials of public value generation by (cultural) open data provision (Callinan et al., 2018; Lin, 2015; Pereira, 2017), the value created by transparently interlinking cultural producers, content, services and consumers needs special attention and is understudied everywhere.

The promise of blockchain is similar – it is an autonomous technology enabling ‘free’ data markets – i.e., data become resistant to the network effects of platforms. The affordance of blockchains for data management is accountability – any piece of content can be written to a blockchain, establishing a secure record of creation that can be tracked, traded, verified, etc. The qualities that a ledger possesses are clarity, consistency and consensus as a factual and agreed-upon recording of the basic datum of an economy: of identity, property, contract and value (O’Dair 2019, Potts and Rennie, 2018). This would enable agents to validate identity (Norta et al, 2019) in order to enter into contracts without needing to share private information. This means overcoming the trust problems characteristic of internet-based cooperation and trade (Dopfer and Potts 2019, Potts and Hartley 2018). There are many initiatives attempting this for the creative industries – Cinezen, FilmChain, MinersINC, Resonate, Binded, Custos, Kodak, Ujomusic, musicNow, etc.

What is interesting to us is that blockchains could enable labour to be traced across a supply chain – it would become a public record who produced or repurposed what. This relates to our aim to understand the role of labour in value and, more specifically, in public value creation. The question is how a data management technology could bring about a new form of coordination where labour becomes publicly visible and can start influencing value perceptions. This relates to Locke’s (1690) concept of ‘just deserts’ – an economic system in which individual labour is important, is possible to identify and conditions just rewards. In the digital economy where incremental innovations accumulate, individual labour contributions have been impossible to identify. This has enabled what Simon (2000) has pointed out – any inventor or investor builds on a vast store of collectively produced intellectual capital, yet they feel justified in earning a much higher proportion of rewards than their own contribution warrants.

Blockchain as a complementary technology to open data provision could enable to trace how value is built when some of its ‘particles’ are publicly contributed forms of content and data and some by independent labourers. It has been suggested that governments should set up a blockchain-based digital infrastructure of registries that would underpin cultural production ecosystems. These could enable identity management, data security, asset provenance, contracting and value transfer (Potts and Rennie, 2018; Norta 2018a, 2019).

We are interested in this potential, but also in how to use open (linked) data and blockchains in complementary ways (technical work for integration has started: Beris and Koubarakis 2018, Kim and Laskowski 2018, Janowicz et al 2018, Norta 2018b, Ruta et al, 2018) as coordination technologies for cultural innovation systems so that whole systems start to generate both public value and private assets.

Relatedly our main research question is: 

How the emergent open cultural data provision utilises Semantic Web and blockchain technologies to integrate a diverse set of value creators into ‘datafied cultural innovation systems’ and what are the ways therein to generate more public value?

Applied aim of the project is to design appropriate solutions for ERR and put forward recommendations for how to improve the public value generation by cultural open data provision.

Towards this end we integrate and build Moore’s and Mazzucato’s views to public value generation and suggest that if we reconceptualise ‘public sphere’ as a ‘cultural innovation system’ to which public institutions and all cultural labourers notably contribute and which as a whole is designed to sort out the publicly valued cultural services, then we need to find a way to identify their contributions so that return a part of the wealth created by this system to these public institutions and independent labourers as value creators for enabling their continued contributions into the creation of public value.

So, these have been our initial ideas. They do change dynamically, however. But for this project also to rely itself on new decentralised data infrastructures we decided to start communicating about it on Subsocial – a new decentralised social network utlising the token economy. We created a special ‘space’ for this here. For us this is an experiment itself. Let us see where will it takes us.