Presentation on ICT and FI-PPP for IFSA conference on Farm System Research in Berlin

1. How ICT is changing the nature of the
farm: a research agenda on the economics
of big data
Krijn Poppe Berlin, IFSA, April 2014
Co-authors: Sjaak Wolfert, Cor Verdouw

2. In 2020 DATA-flows....
are as important
as Money and
Material flows
Thanks to the
strong trends in
ICT

3. Strong ICT Trends
 Satellite and (remote) sensing technology, geo-
informatics
 Sensor technology, robotica in tractors and machines;
computer vision;
 Bio-sensors and bio-informatics
 Internet of Things: ‘everything’ gets an IP-address
 Cloud computing: service delivery via (broadband)
infrastructures
 Smart phones and tablets with data ‘in the cloud’
 Social media (Facebook, Twitter, Wiki, etc.)
 Web of data, Linked Open Data, Big Data
 E-knowledge, E-science

4. App store
Smart Farming in the Cloud
Services
sensors
actuators
data sources
(‘Internet of Things’)
Local
FMS
Spraying Advisory
Services
Meteorological
Service
State and Policy
Information Service
FMIS
E-agriculturist Service
for spraying potatoes
FI-Ware enabled
Cloud Platform
Machine Breakdown
Service
User’s
devices
Other
sources
Cloud
FMS

5. Data exchange by ABCDEF’s
• Large organisations mostly have gone digital, with ERP and other
systems
• But between organisations (and especially with SME) data
transfer and information exchange is often on paper
• While more data exchange to monitor business processes in the
chain would be welcome
There is a need for ABCDEF’s:
Agri-Business Collaboration and Data Exchange Facility
FIspace is such a collaboration facility, built in the FI-PPP

6. Envision that....
 Firms could find each other and connect like in social media
(LinkedIn, Twitter, Facebook, Wordpress)
 Also to specify their workflow / contracts in a ‘conversation’.
 Firms then could start to stream data between each other– like
you upload a photo or video on Google+ to one of your ‘circles’
Linked Open Data: invoices, ‘Internet of Things’ sensor data
Making a choice in using standards like EDI, XBRL etc.
Although compared to Facebook firms might like to have more
control on access to their data (possible with web services and
access rights),
 and do not need storage of their data
 Firms could buy apps (that work with the data streams and
enrich such “open” (and big) data to provide advice)
THAT IS WHAT FIspace WILL DELIVER

7. FIspace platform High Level Architecture
Front-End
FIspace
Store
Real-time B2B
Collaboration
Core
System & Data Integration
Security, Privacy, and Trust Management
Operating Environment
DevelopmentToolkit
I2ND
IoT
IoC
IoS
S&T
GENERIC ENABLERS
DEVELOPMENT
TOOLKIT
Base Technologies
Validation
1. Crop Protection
Information Sharing
2. Greenhouse
Management &
Control
3. Fish Distribution &
(Re-)Planning
4. Fresh Fruit and
Vegetables QA
5. Flowers & Plants SC
Chain Monitoring
6. Meat Information
Provenance
7. Import & Export of
Consumer Goods
8. Tailored Information
for Consumers

8. 8
Technical Overall Platform Approach
Deployed in
the Cloud
Future Internet Core Platform
I2ND IoT Cloud IoS
Real World
Integration
Service Provisioning
& Consumption
Ubiquitous
Broadband
Connectivity
Infrastructure
Virtualization
SPT
Security &
Reliability
Generic Enablers
FI-CODE
Tool Support
FIspace: Extensible SaaS
App 1 App 3 App n
…
Collab.
Workflow 1
…
Collab.
Workflow k
Extension
Mechanism 2:
Configurable
Collaborative
Workflows
Extension Mechanism 1:
Addition of value-add functionality through Apps
User

9. FIspace approach for Software Mass Customisation
FIspace App Store
My FIspace
Develop
Apps
Pre-configure
User Systems
Configure &
Use Systems
FIspace Platform
Single App
Configuration
App developer Business Architect User (farmer, coop)

10. Impact of ABCDEF’s on the food chain
 International market for platforms and apps; replace the
current Farm Management Information Systems
 Also a market for data ?
 New types of contracts: e.g. service level agreements on
machine use
 End-to-end tracking and tracing
 Virtualisation of food chains
 Emergence of direct farmer-consumer markets
supported by ICT.
 More data analysis, more sustainable production

11. How more data contributes to current business models
Transport
loyaltySmall Cost priceGRIN
Transport Transport
Input industries
Farmer Food processor Retail / consumerSoftware
Provider
Logistics
solution
providers
Service cope with retail
Sustainability HealthFood SafetyFeed the growing world
Precision Farming:
better control
Better management
decision
Sophisticated
Technology,
More advise
Segment
products and
input suppliers;
Benchmark with
competitors
Consumer
decision support
(pre- and after
sales)
Better service concepts, e.g. in
store replenishment

12. Impact ABCDEF’s on the nature of the farm
The Nature of the Farm: Family Farms dominate
 The market creates income by enabling specialisation in
functions like labourer, manager, land lord, investor.
 The family farm combines these functions,
 as the market does not induce specialisation
 Due to transaction costs that are too high (a.o. due to
moral hazard and regulations on wages)
 And a low profitability combined with relatively high risk
(due to imperfect factor markets: the exit of labour is
slow as in the family farm the total income is the
relevant variable and opportunity costs are low)
 IS THAT GOING TO CHANGE IN THE FUTURE??

13. Trends favour larger non-family farms:
 Increasing prices and profitability make it more attractive
for outside investors to invest in farming.
 Access to cheap labor from Eastern Europe in Western
Europe also leads to more specialization.
 ICT is a clear thread for the family farm: with ICT the
monitoring options strongly increase and agency
problems can be solved.
 Some activities could disappear from the farm when they
become automated or instructions come from apps
developed in Berlin or Wageningen.
 Effects are stronger in proprietary systems that are linked
exclusively to the ERP system of a big food business than
in an open system where switch costs are low.

14. Towards a research agenda
 Estimate costs/benefits of ABCDEFs in concrete cases
 Analyse the European market for farm software (small
national markets collapsing?) and apps
 Analyse the pros and cons of open ABCDEFs over
proprietary software.
 Analyse how ABCDEFs support regional food webs
 Analyse how ABCDEFs support new services (business
cases) in food chains
 Analyse the regional effects of the trend to big data (does
value added disappear; lack of rural ICT infrastructure)
 Property rights on data: sometimes unclear or very
skewed to industry

15. Thanks for your
attention
krijn.poppe@wur.nl
www.lei.wur.nl
www.FIspace.eu