Data to Go: The Value of Data Portability as a Means to Data Liquidity

By Juliet McMurren and Stefaan G. Verhulst

This article was originally published in Data & Policy, the peer-reviewed, open-access venue dedicated to the potential of data science to address important policy challenges.

If data is the “new oil,” why isn’t it flowing? For almost two decades, data management in fields such as government, healthcare, finance, and research has aspired to achieve a state of data liquidity, in which data can be reused where and when it is needed. For the most part, however, this aspiration remains unrealized. The majority of the world’s data continues to stagnate in silos, controlled by data holders and inaccessible to both its subjects and others who could use it to create or improve services, for research, or to solve pressing public problems.

Efforts to increase liquidity have focused on forms of voluntary institutional data sharing such as data pools or other forms of data collaboratives. Although useful, these arrangements can only advance liquidity so far. Because they vest responsibility and control over liquidity in the hands of data holders, their success depends on data holders’ willingness and ability to provide access to their data for the greater good. While that willingness exists in some fields, particularly medical research, a willingness to share data is much less likely where data holders are commercial competitors and data is the source of their competitive advantage. And even where willingness exists, the ability of data holders to share data safely, securely, and interoperably may not. Without a common set of secure, standardized, and interoperable tools and practices, the best that such bottom-up collaboration can achieve is a disconnected patchwork of initiatives, rather than the data liquidity proponents are seeking.

Data portability is one potential solution to this problem. As enacted in the EU General Data Protection Regulation (2018) and the California Consumer Privacy Act (2018), the right to data portability asserts that individuals have a right to obtain, copy, and reuse their personal data and transfer it between platforms or services. In so doing, it shifts control over data liquidity to data subjects, obliging data holders to release data whether or not it is in their commercial interests to do so. Proponents of data portability argue that, once data is unlocked and free to move between platforms, it can be combined and reused in novel ways and in contexts well beyond those in which it was originally collected, all while enabling greater individual control.

To date, however, arguments for the benefits of the right to data portability have typically failed to connect this rights-based approach with the larger goal of data liquidity and how portability might advance it. This failure to connect these principles and to demonstrate their collective benefits to data subjects, data holders, and society has real-world consequences. Without a clear view of what can be achieved, policymakers are unlikely to develop interventions and incentives to advance liquidity and portability, individuals will not exercise their rights to data portability, and industry will not experiment with use cases and develop the tools and standards needed to make portability and liquidity a reality.

Toward these ends, we have been exploring the current literature on data portability and liquidity, searching for lessons and insights into the benefits that can be unlocked when data liquidity is enabled through the right to data portability. Below we identify some of the greatest potential benefits for society, individuals, and data-holding organizations. These benefits are sometimes in conflict with one another, making the field a contentious one that demands further research on the trade-offs and empirical evidence of impact. In the final section, we also discuss some barriers and challenges to achieving greater data liquidity.

I. Societal Benefits

  1. Informing policy and programs to respond to global problems. Once data can flow freely and be transferred and reused, it can be used to inform responses to issues like poverty, disease, and environmental threats. Ported data made possible the Green Button initiative, which gives consumers access to their smart meter energy usage data and average consumption for their neighbourhood. Consumers using Green Button reduced their energy use by up to 18 percent, which helped states reduce overall consumption, meet their energy efficiency goals, and optimize their grid sizing. Reuse of this energy data by third parties has the potential to deliver further benefits through the design and delivery of smart appliances that optimize energy use based on grid demand. A similar government data portability initiative in India proposes to help underbanked individuals and small businesses access finance by porting and using their past financial transactions.

II. Individual Benefits

Data portability greatly increases individuals’ agency over their information and their choices as consumers. The resulting benefits to individuals include:

  1. Empowerment and informational self-determination. Data portability strengthens individuals’ personal autonomy over data, and their capacity to determine what is shared and with whom. Consumers can choose to share data with certain firms over others, responding to differences in pricing, data handling methods, or other practices. In turn, greater autonomy and control is likely to increase transparency and trust in the relationship between data holders and consumers. Data portability may also empower individuals to engage in citizen science or donate their data for other research purposes.

III. Benefits to Existing and Potential Data Holders

Existing data holders, especially private companies, often see data portability as a competitive threat. It is true that greater data liquidity through portability shifts agency and control from data holders to the consumers who are the data subjects. Equally, it has the potential to increase competition by making data that was once restricted to one data holder available to other players. Nonetheless, organizations holding data also stand to benefit from the data liquidity created by portability if they are willing and able to adapt. Portability has the potential to increase existing data holders’ access to data by enabling them to access additional, previously unavailable sources of data. It can also enable new players to receive data, establish themselves, and become data holders themselves. Among the benefits we would expect to see:

  1. Opportunities for existing data holders to collaborate by aggregating data to create synergistic products. When data becomes more liquid through portability, existing data holders can benefit by encouraging and facilitating the porting of data to collaborators or a jointly created third party. Through collaboration, they can create platform-like ecosystems of synergistic products and services whose value is greater than members’ individual products or services. Smaller players can also use collaboration to achieve the critical mass of data needed to mount a collective challenge to market leaders. Within the banking sector, for example, this could produce opportunities to collaborate over infrastructure, products, and customer interfaces.

IV. Barriers and Challenges

The potential benefits of data liquidity are wide-ranging. Nonetheless, significant barriers to realizing data liquidity at scale through portability remain, even in jurisdictions where an enabling legal and regulatory framework exists. In this section, we discuss some of the barriers and challenges to data portability.

  1. Demand: Both data subjects and data holders need to be convinced of the value of portability to create demand for the right (in those jurisdictions where portability does not yet exist) and for the data itself. Building demand calls for robust use cases that go beyond the often instanced example of mobile number portability to demonstrate the potential value of greater data liquidity. It also requires the development of the skills, platforms and capabilities to exercise the right to portability and make use of any data that is released.

Although the benefits to individuals, organizations holding data, and the public good are real, there is work still to be done in making the public case for data liquidity and in building the structures, tools, processes, and legal framework required to go beyond data portability. As we have suggested above, building awareness among citizens and policymakers is a critical step. To achieve that awareness, we need more robust collections of use cases and insights derived from those cases. In addition, we need a more robust research agenda that recognizes the potential for conflict between the interests and benefits of stakeholders within the portability process, and seeks to identify ways to resolve these conflicts.

We have begun this process at the Open Data Policy Lab (an initiative of The GovLab), and we continue to engage with the emerging field of knowledge globally. In particular, we have been building on our own and others’ work on open data and data collaboratives, all of which offer some important insights into what works and what doesn’t. We invite you to join us in this endeavor by sending us examples of successful (or not so successful) liquidity initiatives, as well as insights and lessons learned.

The authors would like to thank David Osimo for his excellent substantive input and Andrew J. Zahuranec at The GovLab for the editorial review.

About the authors:

Juliet McMurren is a Senior Fellow at The GovLab.

Stefaan G. Verhulst is Co-Founder and Chief Research and Development Officer of The GovLab.



The Governance Lab improving people’s lives by changing how we govern. @thegovlab #opendata #peopleledinnovation #datacollab

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The Governance Lab improving people’s lives by changing how we govern. @thegovlab #opendata #peopleledinnovation #datacollab