miércoles, 9 de marzo de 2016

The case for the regulation of the economic value of personal data

Every public policy has its common places. Regarding the data economy,  there is few sentences more repeated than "data is the new oil". Far from being the exaggeration of the consultants dedicated to the data economy field in order to create momentum for their business, the facts are proving the truth of the statement. However, the sentence was used at the beginning within the context of the open data projects and now it is clear that the real source of revenues is not the open data but the personal data

The time has also prove the truth of another common place, "if you're not paying you are the product". In spite of the rejection that being a product awaken in ourselves, the reality is that the profits of the providers of freemium services increase day by day. And we are not totally feeling awkward with the situation, as a recent Pew research shows, "many Americans say they might provide personal information, depending on the deal being offered and how much risk they face". The worldwide spread of freemium services also proves that not only americans think that way.

Beyond intuition, we can find some figures about the value of personal data. A recent article published by Bruegel present an excellent compilation of the value of personal data for platforms, firms and consumers. The most clear figure is the Google's ARPU (Advertising Revenues Per User) which it is estimated in 45$ per year.

A bold step towards enshrining data as a source of economic power was taken by the Commissioner Vestager a few weeks ago. In a speech in a Big Data conference she left the door open to consider the accumulation of personal data as an element to be analysed in mergers and acquisitions. But the European Commission is not only advancing future scenarios, it is also puting on the table legislative proposals where the economic value of data is plainly recognised. The proposal of a directive for on certain aspects concerning contracts for the supply of digital content considers data as a possible element of a contract for exchange for services instead of money.

Europe is undervalued by US regarding the digital economy and it is criticised for its excessive regulatory activity. However, starting to assume that personal data is an active element in economic transactions and promote the regulation of this value is an step that could help Europe to recover the digital leadership.

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