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3. Institutional Strategies3.7 Costs and business modellingNote: This is a new section and has been prepared by Deborah Woodyard-Robinson [March 17 2006] "Delays in taking preservation decisions can (and
most often will) result in preservation requirements that are more complex,
labour intensive and therefore costly." Through several recent projects and studies we are now beginning to understand what it costs to manage digital material in the long term. See Exemplars and Further Reading Preparing cost models and estimations is an invaluable task. It combines the initial investments with ongoing costs to inform sensible and economical decision making and provides advice on the total resources required to implement digital preservation. Calculating the cost of digital preservation is a complex task, but perhaps even more challenging is assessing the value of this work and securing the funding to perform it. Key decision makers must be convinced that the value of the digital assets is equal to or greater than the cost of the services to maintain them in order to establish economically sustainable processes and business models. CostsThere are too many variables for a single model to be applied to developing digital preservation costs, but there are now several tools and case studies available that can be useful for guidance. Using an established model as a basis can be helpful but be aware of significant differences in collections and material types, organisation mission and the services they provide as all these aspects of an organisation can have significant effects on their costs. A standard approach to determining costs is to break down the digital life cycle into processes based on workflow or a system model such as the OAIS Reference Model2. Each stage or process, called a cost event (for examples see table 1 below), is then evaluated for likely cost sources (for examples see table 2 below). Depending on the purpose of the study a total cost may then be calculated per item, per time period for preservation of all collection material, or per process. Life cycle management is a sensible tool for allocating costs. Using a structured approach such as this can help identify costs which may not have been considered (e.g. costs of selection, etc) and also reinforces that costs are cyclical and very few are one-off expenses. This is well illustrated by Shenton3 in the examination of life cycle management of library collections. Stages identified in the life cycle of traditional collections start with selection, acquisitions processing, cataloguing and pressmarking and go through to preservation, conservation, storage, retrieval and the de-accession of duplicates. Similarly the digitised material lifecycle was broken down into selection, checking intellectual property rights, conservation check and remedial conservation costs, retrieval and reshelving costs, capture of digitised master, quality assurance of digitised master and production of service copies, metadata creation cost, access cost over time, and storage costs over time. An observation of this study was that a one off cost such as cataloguing may appear to be a large proportion of the initial cost, however over time it may easily become a smaller cost component than a recurring cost in the life cycle such as providing access. Similarly the LIFE (Life Cycle Information for E-Literature) Project4 aims to establish individual stages in the born-digital life cycle and examine the cost to provide the full financial commitment of collecting digital materials over the long term. On that basis it also hopes to identify possible cost reductions and potential efficiencies. It may be helpful to use the OAIS reference model as a guide to enhance and inform the future of the long term digital life cycle. The OAIS discusses many processes that will be needed for long term preservation that may not yet be fully implemented within an organisation.
Several factors can have a significant influence on the result of these cost events. The relationship of costs and institutional strategies such as collaboration, third party services, rights management, training and standards are discussed in the previous sections. Other factors include: Labour Object types and storage size Beware of generalising storage sizes for digital file formats. The definition of an “object” must be very specific to make sense of figures. For example an image may be a small low resolution GIF or a large high quality TIFF. When one file size is multiplied by many thousands of objects this can impact storage predictions and costs considerably. Yet the smallest version of an object may not be the most cost effective to preserve if it cannot serve the required purpose, such as in the case of the high quality, substantially larger image. Repository boundaries Existence of services that can be shared such as file format registries and technology watch services will reduce long term preservation costs. Availability of software tools for providing automation will also be a key factor particularly for smaller organisations not able to afford to create their own. Preservation service level Timing Another aspect of timing in relation to costs is the period of retention. Expect that materials to be preserved indefinitely will be more costly than those for finite retention. The cyclical nature of digital preservation expenses will likely determine that disposal of material not required permanently in a timely manner will provide a cost benefit, providing the disposal event does not cost more to achieve than the continued preservation expenses. Business modelsAs described above methods for assessing the costs of managing digital materials in the long term are becoming clearer. Further to this work is the need to prove the benefit or return of this investment in order to secure adequate funding. Key stakeholders and decision-makers need to be motivated to contribute to the medium to long term preservation of digital materials. These key stakeholders include the producer, the rights holder, the repository and the consumer, who each may or may not be the same entity depending on the organisation. Each stakeholder will have different interests and require different incentives to actively participate in the preservation process. In examining the business model a clear focus should be on the end purpose of the archiving process which is to serve the consumers or "designated communities" of current and future users. Organisations such as the British Library are now exploring ways to enumerate the value of their collections and services which had previously appeared to be unquantifiable7. These new calculations based on “Contingent Valuation” prove the worth of supporting their operations to their key stakeholders and funding sources. One reasonably simple method to assess the value of maintaining digital material in an organisation is to present the case if there were inaction and the assets were effectively lost to the community. What would be the cost of replacing them, recreating them or managing to work without them? The espida Project8 at the University of Glasgow is developing a sustainable business focused model for digital preservation at an FE/HE institution. They have recognised that digital preservation so far has frequently been funded only by short term projects, yet there is an on-going cost for preservation. There is a lack of commitment to sustainable funding. Therefore there is a need to demonstrate the benefit weighed against the costs and risks. There needs to be a demonstrable return on that preservation investment, even if it isn’t directly financial in nature. To open PDFs you will need Acrobat Reader - click on the logo:
 References
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