Information commodities make use of storage, processing, and communication capabilities in varying degrees to acquire market value. We have identified five major value-adding dimensions of information commodities: (1) kernel; (2) storage; (3) processing; (4) distribution; and (5) presentation. The kernel is the (organized) information provided by an information commodity. The storage dimension of an information commodity encompasses both the medium used to store information and the method used to gain access to it. Computer-based, as opposed to traditional, commodities can process and reconfigure the information stored within them. Processing adds value by making it possible to transform the kernel. Distribution adds value by making the kernel of an information commodity accessible to the user. Presentation, the final link in the value-adding chain, involves the display of information in forms suitable to the user. The five value-added components provide the basis for an analysis of the cost of producing an information commodity. Major steps in the analysis include: (1) Identification of subtasks in the production process. (2) Determining interdependencies between subtasks. (3) Construction of digraph representing interacting subtasks. (4) Determining the costs of the subtasks and their respective allocations. (5) Using the digraph representation to answer questions about production costs. introduction
This is the second in a series of three articles on the market value of information commodities. In the previous article (Mowshowitz, 1992a), we introduced an abstract definition of information commodity, based on our definitions of information and commodity, respectively. Information is defined as ability rather than as stuff, i.e., information is the ability of a goal seeking system to decide or control. Anything that can be