In today’s data-driven economy, the amount of data a company holds has a direct and non- trivial impact on its overall market valuation. Data are catalyzing not only business, but also governance and everyday life, across all sectors, regions, time scales, economic and political sys- tems worldwide. Online advertising and market- ing have driven developments in this space, trans- forming a decades-old industry and creating some of the biggest businesses (and in a few cases, controversies) of our time. In fact, the online advertising industry is breaking records year after year, both in terms of growth and overall value. BIA Advisory Services predicts that mobile ad- vertising spending in the U.S. will surpass direct mail as the top media advertising platform for the first time in 2022. The global market for Big Data, estimated at US$130.7 billion in 2020, is expected to reach a revised size of US$234.6 billion by 2026, growing at a compound annual growth rate (CAGR) of 10.2%. All this has clearly driven data collection, processing and utilization technologies, with complex platforms enabling online data trading within 100 ms.
However, online advertising is just the tip of the iceberg. Data is being sought and offered in a wide range of applications, and data-driven decision making is having a significant impact across a variety of sectors. According to a large- scale 2016 study by McKinsey, the numbers for the potential of data-driven decision making are staggering, even by the most conservative estimates. Mobility could have a benefit of nearly trillion USD by 2025, while banking is predicted to benefit 260 billion USD per year. The data economy in Europe was worth nearly C325 billion in 2019, equivalent to 2.6% of GDP. By 2025, it will rise to over C550 billion, equivalent to 4% of the total EU GDP. According to a recent McKinsey report, data from connected cars could add 250 to 400 billion USD in annual value to players across the ecosystem by 2030.
In some aspects, this economy is primitive: the source of value – or raw material – are the users of online systems, and they have no choice but to give away their goods (data) to a very few omnipotent companies against whom they have no bargaining power. In exchange for their goods, users receive a range of services, some of which are now essential to everyone’s digital life: web search, connecting with other people, shopping, etc. In each area, there is often a monopoly (Google, Facebook, Amazon, to name a few). As a result, users can not really opt out and must continue to give away their goods without being able to negotiate compensation. This is not a market. It is more like the colonial economy, where peasants had no choice but to work for the colonists, without any bargaining power whatsoever.
This situation has sparked intense debates on various issues, including privacy, discrimination and bias, manipulation of public opinion and spread of fake news, competition and mo- nopolisation, automation and its impact on unem- ployment and economic inequality. Privacy is at stake, and regulators are rushing to establish basic guidelines and barriers to curb negative consequences before it is too late. Data protection has been at the heart of this activity, with the EU’s GDPR being followed by developments in other parts of the world – such as California’s CCPA. In a relatively short time, it has become gener- ally acknowledged that (loss of) privacy is not something to be left to chance or to uncontrolled market dynamics.