I think there are a few things which will be interesting to watch in the next few years as this develops - Governance, Carbon Markets and Regulation.
This looks quite favourable actually.
Open data is not a fully developed theme yet, but if we think about where we currently are:
- Restrictions on data use in Europe (GPDR - General Data Protection Regulation) and in some parts of the US (e.g. California Consumer Privacy Act) are already heralding a change in the landscape.
- Open Banking regulation is already mandated across Europe, UK, Australia and is in early phases of adoption across the US, Brazil and India. Open Banking refers to an open protocol for permissioned sharing of bank account data across financial institutions to encourage more competition in the financial landscape.
- There are predictions already that the emphasis will move to ‘Open Finance’ i.e. sharing other financial information and not just account data and even a full move towards ‘Open Data’ across all platforms - utilities, telecoms, and possibly Agricultural Data?
Open Agricultural Data - Outlandish? Unlikely? 😀
In July, President Biden in Executive Order 15069
encouraged the chair of the FTC to examine “unfair data collection and surveillance practices that may damage competition” and even referring specifically to agriculture:
“unfair anticompetitive restrictions on third-party repair or self-repair of items, such as the restrictions imposed by powerful manufacturers that prevent farmers from repairing their own equipment”
Similarly in Europe, one major funding programme, Horizon 2021 has also offered generous funding of up to €10m for projects “mapping and improving the data economy for food systems” for example. It will be interesting to see what it backs and what happens afterwards commercially.
One of my key takeaways is the issue of trust and governance.
The line from Farmobile above keeps echoing in my head 👉 “lines become fuzzy in situations where the trusted advisor also serves as a retailer selling inputs”.
This is where the actors within the data exchange ecosystem become extremely important.
For example, how might dispute resolution work on a platform, if the dispute involved the platform owner or a major shareholder? This can obviously be managed but generally raises eyes brows if not full suspicions.
I think the market needs to be independent and obviously buyers vetted. The market rules and regulations will need to mirror those of other markets such as regulated financial markets.
3️⃣ Link to carbon markets
Are data markets too closely tied to carbon markets in Agriculture?
Both companies above agreed that current demand from sustainability projects was high and predicted demand for data for sustainability purposes would continue.
Scaling of carbon markets will rely not only data from formal soil carbon projects, but also data from those not participating in carbon projects. Developers and marketplaces have an incentive to gather this data and maybe they are natural buyers of this data.
The value of this data may create a price floor on all data assets while carbon markets scale. Over time, one would expect this to decrease as carbon models start to reach maturity.
But what about the other touted use cases of Manufacturer’s, Financial Services, Insurance or Retail? Will we see these use cases materialise and scale?
This is where use cases on Ocean Protocol could be interesting to watch, to garner which ones take off and which don’t. 🚀🧨
The key question still remains,
Will this usher in an era of ‘Dollars for Data’ for producers of that data?
I think it is clear, somebody will monetise it and hopefully this accrues across the value chain.
For me, this is where the importance of Governance really comes in - the mechanism with the best governance and trust will win.
What do you think?