Open Data: A ‘No-Brainer’ for all

By , 5 December 2013 at 12:52
Open Data: A ‘No-Brainer’ for all
Digital Life

Open Data: A ‘No-Brainer’ for all

By , 5 December 2013 at 12:52

By Richard Benjamins, Director Business Intelligence and Francisco JariegoTelefónica Digital

5 December 2013: The open data debate has, until recently, been largely driven by governmental institutions. Earlier this year, countries from around the world came together in London for the latest Open Government Partnership summit. The meeting was designed to encourage dialogue around making governments more transparent, accountable and open.

While open data is currently mostly a government play, there is no reason why the open agenda cannot be a driver for social good in the private sector as well.

According to McKinsey (see chart below, courtesy McKinsey), as of October 2013, 40 nations had open data portals where they published different types of government data for others to use, such as data on healthcare, crimes, education, traffic, etc. There are more than 90,000 open data sets on the US governments site, while the UK boasts more than 10,000 as of 2013. In total, there are more than one million data sets publicly available from governments worldwide today.

Capgemini estimated that the direct impact of open data on the EU27 economy was €32 billion in 2010, with an annual growth of 7%. In June 2013, the G8 adapted a new charter which will give open data initiatives a significant boost, with many suggesting that the initiative could lead to open data becoming the new big data.

In its report, McKinsey goes further, suggesting that open data could have an annual value of $3 trillion: “Making data more…open, widely available, and in shareable formats has the potential to unlock large amounts of economic value, by improving the efficiency and effectiveness of existing processes; making possible new products, services, and markets; and creating value for individual consumers and citizens.”

[rpsb_list title=”Striking Statistics”] [rpsb_list_item url= ] As of Oct 2013, 40 nations had open data portals [/rpsb_list_item] [rpsb_list_item url= ] 90,000+ open data sets on the US governments site [/rpsb_list_item] [rpsb_list_item url= ] 10,000+ open data sets in the UK (as of 2013) [/rpsb_list_item] [rpsb_list_item url= ] Impact of open data on the EU27 economy was €32 billion in 2010 [/rpsb_list_item] [rpsb_list_item url= ] Open data could have an annual value of $3 trillion (McKinsey) [/rpsb_list_item] [/rpsb_list]

However, while open data is currently mostly a government play, there is no reason why the open agenda cannot be a driver for social good in the private sector as well. There are significant business and social opportunities within reach. For example, who will be the next Redhat or Cloudera of open data?

The areas of opportunity in the open data field break down as follows:

  • Business intelligence: Open data is a valuable external source of relevant information for companies to include in their BI initiatives. Traditionally, BI departments focus on data associated with specific products and services. Enriching company data with open data enables better decision making. If, in addition, social media data is included, business managers will have an integrated view of their customers and markets: what are their customers doing and how it relates to the external environment.
  • External data monetisation of aggregated and anonymous data: Some companies are starting to monetise the data by opening it to industry and governments, especially in the telco and financial services industry. One of the reasons is that they have unique datasets, with the potential to transform whole industries with new insights and products. While open data is not differential by definition (it is free for everybody), combining it with differential internal data may significantly increase the value proposition for the companies’ data plans.
  • Improve society and the planet via Smart Cities: Open data is “of the public and for the public.” A large variety of applications can be built with open data, for both consumers and businesses that optimise energy consumption, improve traffic management, reduce pollution, make healthcare more efficient, and generally make cities smarter and more efficient for residents and businesses alike. Moreover, a growing group of startups are donating elements of their proprietary information as open data to benefit the wider social good.

The real opportunity in open standards is the creation of a thriving open data ecosystem with a platform play

In order to get the most out of open data, a platform is needed that brings all the data together, making data from disparate sources as interoperable as possible, while ensuring privacy, security, and data protection.

This needs to provide APIs for developers and startups, and tools for non-technical people to build simple data-based propositions. However, there is currently no major platform player that can bring everything together in a big data platform and successfully boost the ecosystem.

A key factor to sort out for creating an ecosystem around open data is a new “social contract” (socially and legally accepted) that regulates data production, storage, protection, consumption, and monetisation.

Other important factors in creating an open data ecosystem include ensuring that sufficient data is available, attracting a critical mass of startups and developers that use the platform, and establishing good relationships with key stakeholders such as regulators, data protection agencies, consumer organisations, and the European Commission. Not surprisingly, candidate “platform players” need to be perceived as leaders in the data and analytics space.

As McKinsey summarises in its report: “The benefits of open data can be self-reinforcing: as individuals perceive benefits from the use of open data, they will help to improve the accuracy and detail of information available, thus increasing the value of the data and the benefits that they can receive. However, this cycle can gather momentum only if private industry and public agencies cultivate a vibrant open data ecosystem and create data policies that provide adequate protection for all stakeholders. Companies will need to put in place the technologies and talent to collect and analyse the data. Individuals—as consumers and citizens—will need to be vigilant and savvy providers and users of open data.”

At Telefónica, we are big believers in open data. From our cross-industry #TheOpenAgenda project to our Datathon for Social Good, via our work with the smart city of Santander Telefónica is showing how open data can be used to benefit society.

Open data is an exciting and innovative space that has the potential to revolutionise the way in which organisations treat their data. However, it will only happen if the private sector follows the example of the public sector and begins to realise the value in making their data available for the greater public good. Once they do, the opportunities are unlimited.

previous article

[Guest Post] We must create a culture of “open data makers”

[Guest Post] We must create a culture of “open data makers”
next article

[Guest Post] Why Open Data is accelerating socio-economic change

[Guest Post] Why Open Data is accelerating socio-economic change