Last week, the European Commission published a “proposal for a regulation of the European Parliament and of the Council on harmonized rules on fair access to and use of data.” Building on the European strategy for data published early in 2020, this Data Act is meant to give European institutions and member states a common set of rules for using and reusing non-personal data from industrial equipment and the internet of things.
My Paris-based colleague, Thomas Husson, wrote a report back in 2020 which argued “Europe’s digital renaissance starts now.” Europe’s then-fresh data strategy and this week’s Data Act are critical pieces of his argument that “industrial B2B platforms are the key to Europe’s technology future.”
The Commission forecasts that the value of the data economy to the European Union’s 27 member states will grow from €301 billion in 2018 to a predicted €829 billion by 2025. But there’s a significant challenge here, and it’s one that I hear again and again in my conversations with Forrester clients: Smaller industrial firms without the talent, confidence, and legal muscle of Europe’s manufacturing giants have picked up a worrying message from years of being told that data is “the new gold.”
Instead of enthusiastically rushing to share their own data and reuse data shared by others, they’re (understandably) taking a far more cautious approach. They hear that data is valuable, but they’re not sure how valuable, and they don’t want to sell themselves short. They hear that data can be combined to extract new insights, but they’ve no idea how, and they don’t want a competitor inferring more about their assets and customers than they know themselves. It’s easier, many conclude, not to share than to share too cheaply or too freely.
And even those that take the plunge are struggling: A report of mine on monetizing machine data notes that only 29% of the manufacturers monetizing data in 2019 described their efforts as successful. The Commission seems to understand this, and there are activities underway to help organizations build the skills, confidence, and legal safeguards they’ll need. Europe’s industrial superstars such as Airbus, Bosch, Siemens, or Volkswagen can do a lot, but they recognize that even they can’t build much of an industrial data economy on their own.
Data Spaces Help Companies Safely Share, Find, Or Monetize Data
And that’s where an important piece of the European data strategy slots into place: the idea of building common data spaces that will be as valuable to the smallest players as they are to the continent’s giants. The Commission proposed nine of these data spaces:
- Industrial & Manufacturing
- Green Deal
- Public Administration
A staff working document released with all the other documents the Commission published last week offered a fresh look at progress to date. I’m finishing my own report on the value of industrial and manufacturing data spaces at the moment and may dig into mobility, energy, and (maybe) agriculture at a later date.
These recent documents are the European Commission’s proposal for what the rules should look like. The final result may be quite different, and it will take several years to materialize. But there are important signals here for European firms and for those from whom they buy, to whom they sell, and with whom they partner. To realize the ambition behind these proposals, data must be able to cross Europe’s borders, both inbound and outbound. But everyone — data owners, users, and subjects — must have the confidence that the data is accurate, timely, secure, properly valued, and not subject to misuse. As industrial firms across the continent continue shifting from grease to code, recognizing that data-powered services matter as much as the physical machines, they need to get this right.
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