As we have become more digitised, we are generating more and more data. According to Forbes, there are approximately 2.5 quintillion bytes of data produced each day. In the last two years alone, we have generated 90% of all the data that exists in the world. Today, data is produced and used by almost everything you can think of from smartphones to social media, GPS systems to the stock market. It is big money with Big Data and Business Analytics Solutions forecasted to reach $260 Billion in 2022.
Despite being an industry worth over a quarter of a trillion, it is difficult to exact a value on data economy. Few people understand the myriad of intermediaries and data aggregators who sell data to companies – many of whom are household brand names. Even fewer people realise that these same middlemen often refuse to show where they sourced their data. The reasons for this are plenty and varied; data could be stolen, replicated, falsified, damaged, or they simply want to protect their own sources. The underlying truth is that governments and corporations are spending millions of dollars and trusting decisions made based on data that might be far from accurate.
Data Storage Asean spoke to Mike Davie, CEO of Quadrant to get his views on data economy and how new technologies can be used to authenticate data to generate more trust and accuracy and at the same time, making data more accessible.
Understanding the Data Economy market
According to Mike, the production, analysis, selling, and use of data has formed its own economy, known as the Data Economy. He claimed, “Despite its size and importance, very little is known about it, and much of the conversation around data has centred on the acquisition and sharing of personal data, mainly thanks to Facebook, Google and other companies, but the Data economy goes much deeper than that.”
“The Data Economy is the creation, flow, buying and selling of data. Data producers (such as ride-sharing apps which emit data on the movements of passengers and drivers) create data, which is then stored and often purchased by a third party. The third parties who purchase this data then use it for their own, separate business purposes.”
“There are many different types of data producers, from mobile apps to Point-of-Sales systems. Then there are the purchasers of data, such as FMCG firms or governments who buy data and use that data to make decisions – often major ones worth tens of millions of dollars.”
He believes that in most cases, “some, if not all of this data used to influence these decisions will have come from the Data Economy”. Examples of some of the benefits of using data from the Data economy include the health services becoming more accessible to everyday people and marketing campaigns becoming more effective for corporations.
For Malaysian companies, Mike explained that there is a lack of transparency in the Data Economy, which could have real consequences.
“If you base decisions on information and data that you have no idea where it came from, then you should expect poor results from that data.”
Mike attributes the biggest problem to be the method by which data transactions are being made, which are often “chaotic and opaque”. In order to purchase data, organisations would have to go through a series of middlemen – such as data aggregators – to get the data they need. For example, if a large consumer firm wanted to know how many consumers bought its products around the world, it would have to go through several other companies to gather this, who in turn would gather this data from other companies such as POS or loyalty card firms.
Mike pointed out that many of these firms hide their sources. They do not want to show where they get their data from for legitimate reasons (protecting sources from competition etc.) or possibly due to malicious reasons (falsified or replicated data). This means that by the time the data is delivered to the end-user they have no idea where it originally came from and therefore risk using poor quality data to make multi-million-dollar decisions. This is not a position any company would want to be in.
When it comes to data regulations and compliance laws, Mike said the regulations in most parts of the world and the Southeast Asian region are more driven by privacy concerns rather than problems with transparency in the Data Economy.
“Few people understand how data is transacted, yet modern mainstream media narratives primarily concern data privacy and cybersecurity. More regulation will emerge, and it is hard to gauge the effects they will have. However, we need to concentrate on developing regulations that protect the individual yet still make data easy for firms to access and use to create solutions and innovate. If we manage this then life for all of us will get better.”
Using Blockchain technology to authenticate data
The most common method to ensure data is secured is through encryption. Yet still, the source of data is not known. Mike suggested that one possible way for businesses to authenticate data is via blockchain technology.
“Quadrant authenticates data via the Quadrant Protocol. We use Blockchain-enabled data authentication technology to stamp data with a unique signature (also known as a ‘Hash’) as it is created, placing it on Quadrant’s blockchain. This guarantees that, from the time of stamping, any change in or corruption of the data will result in a misalignment to the unique signature, signalling to the buyer that the data has been changed.”
Mike added that by using Quadrant Protocol’s data authentication technology and blockchain, companies hash data that goes onto an immutable ledger. So, whenever it is analysed and consumed, they go back to the data source, knowing that the data is true to the moment it was stamped.
Quadrant Protocol enables the tracing of the bad data to the bad actor whenever the data is delivered in a bad state. This allows for trust and transparency in the data economy, as companies are able to know who the middlemen are who supplied the data – thus creating accountability. Importantly, it also allows companies to map disparate sources of data together, organising the data and making it easier to innovate and develop creative solutions and products.
Organisations who would benefit from this technology fall into two main categories. Firstly, data producers would use Quadrant to stamp their own data into an immutable historic ledger. This creates a record of the data that they produce and provides a guarantee that the data is authentic as at the time of stamping. Importantly, this also creates trust and encourages organisations to use their data.
Secondly, data users would benefit from our technology. These users could be any industry or type of organisation – from start-up to multi-national, government to NGO – and they would require data to help them make business or strategic decisions. Many of these users would be making multi-million-dollar decisions based on analysis of data, and so it is vitally important that the data they use is accurate and authentic. Furthermore, there is a growth in the development and use of Artificial Intelligence (AI) which needs accurate, quality data in order to work properly.
In general, Mike believes Blockchain technology is perfect for supply chains- be it for data, food or goods, as it allows companies to trace products to the source. Walmart is asking its suppliers of green vegetables to upload their data to the Blockchain, for example, as this will allow for better and quicker tracking of vegetables to source farms (helping identify sources of E. Coli, for instance). Most industries have long and complex supply chains, and so Blockchain technology will grow in use and importance.
Lastly, the ability for users to map different data sources will allow them to do more, create new and better solutions, which is another huge plus point.
Blockchain allows data to be tracked to its source (as at the time of stamping) which creates accountability and trust. Furthermore, as the data is mapped together on the Blockchain, Quadrant can also start to map multiple (literally thousands) sources of disparate data together, helping to create a much bigger picture. The organising of this data will allow entrepreneurs and companies to develop better and more innovative solutions that can be used to solve problems.
“We have also developed solutions that enable organisations to pay for our services using Fiat currency – ensuring they comply with their own accounting standards – and allow data producers to have a choice of being paid in Fiat or token. We do this through our Data-Smart Contracts, which make it easier for producers to monetise their data and facilitates the transfer of good quality, authenticated data between producer and user.”