Postcodes have become the new bugbear of the UK opendata campaigners, its something everything knows and uses as their default spatial reference to home or work. As such, its the reference that is essential to make many location enabled websites work, we almost unconciously look to enter our postcode in a little searchbox when we see a map.
I really, really don’t want to see a massive debate rage in the comments about “ooh, it should be free”, yes we all agree, but it won’t happen. The Postcode Address File is a commercial asset to the Royal Mail, who are a quasi-private company, its their IP and funnily enough they ain’t going to give it away for free.
Ernest the Troll

Ernest Marples, was a valiant effort but as someone put it, was a “blatant trolling exercise” on the Royal Mail. Raising the flag, saying we’re making your copyrighted data freely available for good purposes, come and get us if you want a veritable hurricane of bad publicity.
Predictably, the Royal Mail responded with legal threats and poor old Ernest was exiled to Monaco. In the even more predictable furore that followed, we had the futile petition to the Prime Minister, and an awful lot of ‘outraged of Oxford’ posts on the OSM and data.gov.uk mailing lists.
We Need a Practical Solution
Putting together something that’s usable and won’t get you sued seems like a top priorty to me. It turns out a Masters in GIS was useful after all. The Office of National Statistics aggregates the UK’s census and national statistics to a hierarchical spatial referencing system called Output Areas, like this one which includes my postcode:

From conversations with people from the ONS, this is free from copyright, confirmed here:
Boundaries for Output Areas (OAs), Lower Layer Super Output Areas (LSOAs), Middle Layer Super Output Areas (MSOAs) and Travel to Work Areas (TTWAs) are available free of charge to all users.
The supply of boundaries for all other geographies requires recipients to be licensed for use of OS Boundary-Line™ before we are able to supply them.
ONS Website, 20th October 2009
Output Areas are free of Ordnance Survey contamination and available to all without licence. Win. You can request a copy here.
What about Postcodes?
The ONS also make available postcode to Output Area lookup files, correct as of 2004. Free of copyright. Big win:
Conditions of Supply
There are no restrictions on the use of the information contained on this CD.
“OA to higher areas lookup readme file final.doc” – OA to Higher Area & Postcode to OA Lookup Files (Mar 2004)
What does this mean?
We can reference any postcode, free of copyright, to a local area. While it doesn’t georefence to an exact street, it does reference to an area that is perfectly usable for websites such as PlanningAlerts.com and JobCentreProPlus.com. The ONS states that each OA corresponds to about 125 households, and there are 175,434 OAs in England. Another example:

What’s Next?
We had a good hacking session and I expect @simonw will be releasing something very useful, very soon. So, free postcodes for all then.