miércoles, 6 de septiembre de 2017

The rising importance of free flow of data (I): Why

Enabling Free Flow of Data (FFD) in the European Union has jumped from a marginal note to a first rank priority on the European Digital Agenda. In order to appreciate this change, it is enough to compare the space dedicated to the issue in the policy documents published by the European Commission. While in the communication "A Digital Single Market Strategy for Europe" the issue was described in few more than a paragraph; in the recently published "Mid-Term Review on the implementation of the Digital Single Market Strategy A Connected Digital Single Market for All" the item was described with greatest detail accross several pages.

Why the issue of free flow of data is so important? A few figures taken from recent studies are enough to provide the big picture. On one hand, the McKinsey Global Institute has estimated a growth of 45 fold of data flows which have boosted the world GDP by 10% since 2005. On the other hand,  according with a study on the European Data Market it is expected that the value of the data economy in the EU will be around €739 billion, 4% of the GDP.

Besides the economic figures, there are also political reasons. Enabling FFD is required to updating the European project. The basis of the European Union are the so called four freedoms: the freedom of movement of services, products, capital and people.  In an increasing digitalised world, the above freedoms heaviliy depend on the free movement of data. FFD has become the 5th freedom to guarantee for an ever closer Union. 

And it spite of its importance on the digital era, only 87% of the European companies shared data with other companies. This is what can be called an economic blindness. The value of data growth with its aggregation and processing, following a recursive pattern. Therefore, promoting the sharing of data is critical to reap the full of the data economy and the distrubution of its benefits among the whole society. Namely, the dat economy enable more innovation, new business models and accessing to new markets, and better welfare services based on policy evidences.

So far is what we can obtain from the data economy and the free flow of data. What we can do for the creation of the right environment for a thriving data economy will be the focus of the next post

 


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