Is data really that important to a business?
A quick survey of the top companies by market capitalisation readily reveals that data is key.
The myriad ways in which data may be used
Global | Publication | February 2021
The value that can be gained from data by businesses will inevitably lead to an increase in the use of data to improve daily operations and to develop new products, services and processes.
There are many ways in which businesses might do this:
- Increase in licensing-in of data: Including use of open data, or sharing of data.
- Monetization of data: This may be in the form of bilateral negotiations between businesses or, for example, through specific data markets for sharing data relating to specific industry sectors.1
- Increase in the use of available data: For example, the European Commission is driving efforts to make public sector information open, EU-wide, accessible and reusable in order to stimulate the region’s data and knowledge economy and to support SMEs. The European Commission is also focusing on dominant data platforms (so-called “digital gatekeepers”) from an antitrust perspective with a view to opening up their data as part of the EU’s proposed Digital Services Act (see Antitrust / Competition Law Data Issues).
- Use of own business data: To improve product design and manufacturing, operational efficiencies, benchmarking, customer service, market reach and decision-making, in each case to drive innovation and to reduce the time to market. A business’s own data may also be used for the purposes of providing a better working environment for staff, such as equality and diversity, health and safety and training.
- Sharing of data and insights with business partners: Such as manufacturers, suppliers, distributors, and customers in order to optimise procurement, supply chain efficiency, customer service, and to enhance product offerings.
- Sharing of data with complementary businesses: In order to deliver new and innovative services and products.
- Sharing of data with new forms of data businesses: Such as data aggregators, analytics companies and AI developers.
All these data-related activities will need to be carried out within a rapidly changing regulatory environment for data in many jurisdictions, particularly where such activities are cross-border in nature (see Regulatory Environment for Data).
Footnotes
1
See Commission Staff Working Document, Free Flow of Data and Emerging Issues of the European Data Economy, page 13, footnote 43.
The myriad ways in which data may be used
The value that can be gained from data by businesses will inevitably lead to an increase in the use of data to improve daily operations and to develop new products, services and processes.
Nature of data, ownership, and control
In many jurisdictions pure information, or data, is not considered to be property. This is because a claim to property in intangible information presents obvious definitional difficulties.
Ways of protecting data
There is a patchwork of different rights, intellectual property rights and contract rights that may apply to data. Understanding the way in which these rights come into play enables a business to understand how its data assets can be protected.
Disruptive technology data: case studies
Disruptive technologies, such as AI, IoT, AVs, distributed ledger technology (DLT), cryptocurrencies and smart contracts, generate many different forms of data. What are the particular characteristics of such data, and to what extent can intellectual property rights or other rights protect them?
The regulatory environment for data
In this section, we review the EU’s position with regards to industrial and non-personal data and look at whether other jurisdictions have similar initiatives.
Free flow of data
Data location laws (in relation to industrial and non-personal data) can be restrictive (as in banking secrecy laws, which may require some types of data to remain onshore or to be “localised”) or liberalising (as in laws that ban the prohibition of export of data from a locality).
Data for re-use
In furtherance of the objective of leveraging existing datasets paid for by public funds, a number of jurisdictions have sought to make public sector information (PSI) available to industry.
Antitrust / competition law data issues
The exclusive possession or control of data can have antitrust / competition law considerations, giving rise to access disputes.
Contractual considerations in sharing data
The uncertain nature of intellectual property rights in data means that “contract is king” in data transactions.
Managing Data
Data is an incredibly valuable resource for businesses, enabling organisations to effectively operate and to make business improvements. In order to exploit this value most effectively, businesses must invest in good data management.
Liability
Errors, incompleteness or biases within data may flow through, and be amplified by, data analytics process outputs upon which a business's strategic and investment decisions may depend, potentially causing business losses. In this section we deal with liability arising out of use of data / datasets that are in some respect sub-optimal.