The Data Economy is clearly a driver of change in the technology industry, but also affects the healthcare, transport, energy, financial services and other industries. Everyone agrees that data has become a new economic asset and is an essential resource of the future Digital Economy.
Both regulators and businesses are affected: the former trying to adapt the regulatory landscape to ensure that the data revolution will benefit the economy and society at large, the latter trying to exploit all opportunities deriving from the new (big) data market and to adapt to the legal developments.
In the European Union, building a European Data Economy is part of the European Commission's Digital Single Market strategy. According to the European Commission1 , if favorable policy and legislative conditions are put in place, the value of the EU Data Economy may grow from EUR 300 billion in 2016 to EUR 739 billion by 2020, and over EUR 1,000 billion in 2025.
To stay ahead in this growing Data Economy, it is key to understand how the following topics affect businesses across all industries:
A – Artificial Intelligence and Machine Learning
Data is recognized as an increasingly critical asset for the development of new technologies such as Artificial Intelligence (AI) and Machine Learning. From virtual assistants to automated workflows, AI has the potential to have a profound real-world impact on businesses in all industries, and can provide potential benefits for both the public and private sectors. With the right approach, companies that rely on AI are most likely to establish a sustainable, industry leading competitive edge. This, however, triggers a number of legal and regulatory issues, starting with issues regarding the collection, gathering and re-use of personal data in this context.
B – Blockchain
Blockchain and, more generally, Distributed Ledger Technologies enable countless applications and can improve operational inefficiencies, particularly around risk management. Many industries from supply chain to healthcare and beyond are keen to unlock the value such technologies promise. Given their complexity, several legal questions arise. Cross-jurisdictional personal data protection is a key concern. Organizations need to be ready to navigate the rapidly changing regulations in each market as they adapt to the increasing prevalence of Distributed Ledger Technologies.
C – Cybersecurity
Cybersecurity is a high priority for top management, whether in the private or public sector. In light of the risk that recent massive cyberattacks have generated, it is important to remember that the measures aimed at fighting this type of threat are not all of a technical nature. Legal, regulatory and even organizational measures can be key to avoiding damage, or at least to minimizing its impact. Developing, managing and implementing data security policies, procedures and emergency plans may help protect organizations against cybersecurity threats.
D – Digitalization and Big Data
As the world becomes more digital and interconnected, almost any smart device can produce and collect information, presenting both challenges and opportunities as big data is only likely to get bigger. Making profits out of big data requires the use of advanced analytics in addition to a comprehensive understanding of legal ramifications of data use and protection. We see that organizations that learn how to navigate these legal ramifications can get the best out of big data and unlock potential new revenue streams.
E – Ethics
Our digital world and all the new developments mentioned above trigger new ethical and legal problems, in particular in relation to the right to privacy which is threatened by the emphasis on the free flow of information and big data analytics. Technology is neither good nor bad in itself; it is only as good or as bad as what we make of it. This topic is more and more relevant for organizations to take ethic-based decisions in their implementation of technology and use of data and personal data.
F – Free Flow of Data
Ensuring the free flow of personal and non-personal data is key to unlock the re-use potential of these different types of data and is a pre-requisite for a competitive Data Economy. On 25 May 2018, the new General Data Protection Regulation (EU) 2016/679 entered into force. This establishes in principle the free flow of personal data within the European Economic Area. In the same line, the Regulation on the Free Flow of non-Personal Data in the European Union (EU) 2018/1807 will enter into force in May 2019. This Regulation aims at removing data localization restrictions in EU Member States, as well as addressing emerging legal issues in the context of new data technologies (e.g. data access and portability).
No doubt these topics will continue to have a transformative effect on all sectors of the economy, including the TMT industry. They also raise a myriad of legal and regulatory issues to which the answers are still being developed.