Are data rooms the key to monetizing data?

Many companies are sitting on real data treasures. These can be monetized – either through the direct sale of data or through value-adding use via digital marketplaces. So-called data rooms or data spaces provide the platform for this. According to many experts, these data spaces can open the door to the next dimension of digitization.  

According to a survey conducted by the German Economic Institute at the end of 2022, however, only three out of ten companies are truly “data economy ready” – i.e. they store, manage and use their data intelligently. This is confirmed by a recent Bitkom study, according to which only one in three companies exploits the full potential of the data available to it.  

However, this could soon change. Three lines of development are currently converging on the same goal: the economical handling of data across company boundaries.  

• The global networking of companies and data ecosystems is developing rapidly and has long since become inevitable.  
• The pressure on companies to actively promote this networking is increasing. After all, well-networked companies can shorten their time to market, find answers to their cost pressures, and are able to master growing regulatory requirements. To cite just one example, the requirements of the German Supply Chain Act can only be met through global networking.  
• Experts agree that the value of data, which has so far largely existed in internal company silos, increases dramatically through the systematic exchange of data across silo boundaries. Many companies and initiatives are already implementing this insight in their business activities – with data spaces.  

Controlled data exchange platform  

Data rooms provide an infrastructure that makes data sharing much easier. A data room consists of the technical platform with the services, processes and governance functions needed to ensure compliance with the agreed standards and principles.  

The individual data spaces differ thematically and in their areas of application. The Mobility Data Space (MDS), for example, is a marketplace where any mobility-related data can be offered and obtained. The data offered ranges from information on traffic volumes, construction sites and road conditions, to gas prices and electric charging stations, to weather, public transportation and car and bike sharing information, or vehicle data from manufacturers that provide information on vehicle use, for example. It is up to the consumer to decide for which use cases the data is used.  

Others, such as the automotive network Catena-X, are designed to implement specific industry-specific use cases. These include, for example, recording the CO2 footprint of products across the entire supply chain,  

• Battery and product passports  
• The circular economy and the traceability of parts, or  
• To be able to track and communicate quality issues across a supply chain  

Together, the initiators want to reduce costs, accelerate implementation and create new business value. A crucial point here is that operational data is not stored centrally in a data room but remains with its owner. The only thing that is done centrally is the mediation of the data, i.e. above all, the discovery and contracting.  

This means that users have access to data from various sources, but the administration, security and compliance of this data always remains in the hands of the respective provider. However, each partner with a data set also assumes responsibility for data protection, data security and further handling of the data within their organization.  

A data space thus enables the participating organizations that produce and use data to make their data accessible to third parties without running the risk of losing control over it. At the same time, they have the opportunity to use data for their own value creation that would hardly be available to them without a data space.  

Data spaces: A breeding ground for creative ideas  

The communicative framework of data spaces and the many possibilities it offers are the ideal breeding ground for creative ideas and impulses. This makes a data space a highly professional environment for new solutions that can advance entire industries.  

The fact that this principle not only works in theory but also proves itself in practice is demonstrated by the success of existing data rooms such as International Data Spaces (IDS), MDS and Catena-X, as well as the dynamic development in this area.  

The opportunities provided by data rooms are particularly welcome where companies in the same economic sector or industry work together in certain business processes or are involved in the same value chain.  

Common interests, common data rooms  

But companies from different industries that have similar interests in terms of content can also use a data room to jointly develop new products or solutions. One organization created for this very purpose is Gaia-X. This EU-backed project provides the basis for data room initiatives and positions itself as an open-source platform that helps small and medium-sized companies and organizations develop new data-driven business models.  

The basis for this is a common set of rules for access and transport protocols, services and guidelines, which is built on the principles of transparency, data security, GDPR compliance, interoperability and scalability. The open-source approach is designed to enable stakeholders to easily combine different providers as needed.  

Companies from the energy and automotive industries, for example, can collaborate on e-mobility. Gaia-X makes such cooperation much easier and more efficient than before. Gaia-X Germany supports a wide range of funding projects from the Federal Ministry for Economic Affairs and Energy.  

The mobility industry is pioneering the use of data spaces  

The mobility industry is at the forefront of the data spaces initiative. Almost 180 players are currently involved in its data space Catena-X – major manufacturers as well as suppliers, mobility providers and organizations such as ADAC. Their stated goal: a common data infrastructure for the entire supply chains of the industry.  

Raw material suppliers, component suppliers, carmakers, users and recyclers are also networking via Catena-X to better trace sources of error. So far, companies have only documented information on processes and components for which they are responsible internally. In the future, end-to-end data chains will show exactly who has installed which materials and components or which software has been used.  

A second shared data space for the industry is the aforementioned MDS, which is funded by the Austrian Federal Ministry for Digital and Transport (BMDV). Around 150 companies are currently active there – mobility service providers, municipalities, public transport companies, companies from the energy sector, mobile network operators and research institutions. The data offered by MDS includes information on traffic and traffic flow, construction sites and road conditions, parking and public transport, car and bike sharing and much more.  

The goal: A networked industry  

The Gaia-X standards and the pioneering role of Catena-X also form the basis for the Manufacturing-X industry platform. Its goal is to share data across the entire manufacturing and supply chain. Among other things, Manufacturing-X is designed to make resources and the carbon footprint transparent and provide information in line with the Supply Chain Act.  

The benefits for companies:  

• Through the controlled exchange of information, ideas and data, they have the opportunity to master their own challenges faster and more efficiently.  
• They can meet the requirements of the supply chain law and the future battery passport – this is almost impossible without cooperation via a data room.  
• They may be able to monetize their own data.  

First steps toward a data room  

Companies that want to participate in a data space should first take a look at the existing data spaces on offer. As a user, all that is required is a simple registration. The services needed to connect to the data space can be booked as a SaaS solution. Knowledge is made transparently available in the form of open-source solutions and KITs (Knowledge and Innovation Toolboxes).  

It then makes sense to clarify which use cases could benefit from additional data sources. To do this, you select a suitable use case in the data room – for example, determining the PCF (CO2 footprint), supply chain resilience or quality management. Based on this, the corresponding data requirements can be determined.  

The concept of data products can help here. This involves treating a data set like a product. This simplifies the structured overview of which data is still required or should be connected and, if necessary, transformed.  

Data exchange takes place via the Eclipse Data Space Connector. Those offering data can define policies (who can use which data for which purpose and for how long, etc.). The conditions under which the exchange takes place (price, retrieval intervals, etc.) are negotiated in a contract. If the partners agree, the data exchange can take place via a secure API.  

Data spaces increase the benefits of digitization  

The initiators of data spaces expect cross-company data spaces to significantly increase efficiency and thus the benefits of digitization in the industry. Companies that want to take advantage of the opportunities can work with service providers who are familiar with data spaces and can help them enter the relevant data rooms.  

Konrad Krafft is founder and CEO of the consulting and software company doubleSlash Net-Business GmbH. He studied general computer science with a focus on artificial intelligence and has been involved in the development of digital services for over 20 years, particularly in the area of business processes and software products. As an expert, he deals with the industrialization of software development and new digital business models.