Data Ownership in the Data Economy: A European Dilemma

EU Internet Law in the digital era, (edited volume based on the REDA 2017 conference), Springer, (2018) Forthcoming

16 Pages Posted: 27 Nov 2018 Last revised: 18 Dec 2018

Date Written: August 1, 2018

Abstract

Data has become an essential resource in the new economy. Artificial intelligence is increasing its computational capacity and uses big data techniques to analyse large datasets in real-time and extract precious knowledges. As the data-driven transformation reaches into the society, ever-increasing amounts of data are generated by autonomous connected machines or processes based on the Internet of Things (IoT). The value of the “data economy” in the EU was estimated more than EUR 285 billion in 2015, with a 5.03% annual growth. With the right policy and legal framework conditions, its value is expected to increase to EUR 739 billion by 2020.

The new data economy raises however new challenges and unsolved issues. The enormous diversity of data sources and the variety of opportunities for applying insights into this data are only beginning to emerge. To unleash the potential of these opportunities, players in the data market need to have access to large and diverse datasets. Access in relation to machine-generated-data is therefore a crucial factor for developing a data economy.

In big data, IoT and smart technologies, where a multitude of actors interact in the elaboration of data, it is often questioned: who owns the data? While organized datasets can be subject to intellectual property rights, and the use of personal data is regulated by data protection laws, this question particularly applies to raw (machine-generated) data, that are increasing their value as a source of precious insights and fall outside the scope of classical ownership/property schemes.

As part of its Digital Single Market strategy, the European Commission has started a series of initiatives aimed at addressing the data ownership issue. They culminated with the idea of introducing a novel right in raw machine-generated data.

Do we really need new ownership rights in data? This paper briefly summarizes the European Commission’s strategy. It recalls the main characteristics of the data value chain. It then elaborates on the existing EU acquis on data ownership, deriving from intellectual property rights (namely copyright and database right), trade secrets, and factual control situations derived by data protection laws. These ownership mechanisms are powerful although difficulty extend to raw data. Likewise, raw data appears excluded from traditional property rights. Despite this, gaps in law has been filled through contractual schemes and technological access restrictions that enhance the ability to control data. Thus, many commentators believe this ownership framework does not need further intervention.

The paper further explores the position of those that support the idea of a new property right in data and elaborates on the new proposed right. This analysis concludes that creating new monopolies capable of restricting open access to data, may result in a threat to development of an EU data market. Further economic evidence is needed before discussing the introduction of such a new right. Indeed, we should learn from past lessons, as it happened with the Database Directive: new rights, once introduced in the legal system, even in the absence of any evidence about their positive effect, are here to stay. Other suggested approaches seem more able to fit the needs of the data-economy. In particular, sector-based access against remuneration can be an option to investigate. Also in this case, however, this must come together with economic evidences and in dept analysis of possible market failures.

Keywords: data ownership, intellectual property, data protection, data producer's right

Suggested Citation

Banterle, Francesco, Data Ownership in the Data Economy: A European Dilemma (August 1, 2018). EU Internet Law in the digital era, (edited volume based on the REDA 2017 conference), Springer, (2018) Forthcoming, Available at SSRN: https://ssrn.com/abstract=3277330 or http://dx.doi.org/10.2139/ssrn.3277330

Francesco Banterle (Contact Author)

University of Milan ( email )

via conservatorio 1
Milan
Italy

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