Data Markets: a category in search of new business models

1. Summary

In domains like financial services, the buying and selling of data is commonplace, and providers such as Bloomberg and Thomson Reuters are well-established. Elsewhere, too, there is recognition that data supports good decision making when creating new products and services, both for businesses and the individual consumer.

This is joined by a growing realization that the data to support decision making doesn’t always have to be created in-house. As a result, a number of new data markets have emerged in the past few years. Riding a wave of freely accessible data from governments, nongovernmental organizations (NGOs), and international institutions such as the World Bank, these companies are in the business of providing access to data — from information on U.S. census returns to the location of every Starbucks in Canada.

A wide range of companies exists in this space, and often there are more differences than similarities in the various products on offer. Some of these companies, like AggData or Datafiniti, act as aggregators, pulling data from numerous topic areas across the web (e.g., entertainment, health, legal) and offering it for download from a single place and in a consistent manner. Others, like Factual, go further, cleaning data and aggregating facts from across multiple data sets. Still others offer visualization tools to better understand data, as DataMarket does with its datamarket.com portal. The financial models for these companies are different, too. Some charge the data provider, others the data consumer, and others are exploring ways of charging both.

In this report we describe the basics of a data market, explore the ways in which various companies are beginning to position their offerings, and look for evidence that there is sufficient demand for this market segment to prove sustainable.