Posted on: Friday 11th of January 2013
Last night the Government lodged an amendment to the Enterprise and Regulator Reform Bill in the House of Lords to give the midata programme legislative backing. The amendment enables the Secretary of State to make regulations to companies to provide to their customers (upon request) their personal historic transaction and/or consumption data in an electronic format.
At one level, the practical implications of this move are quite limited. Only a few sectors are directly involved (energy, mobile phone, current account and credit card suppliers) and most of them have been involved in the voluntary side of the midata programme for over a year already. Also, the amendment doesn’t amount to legislative compulsion in its own right. Instead it gives ministers the power to introduce secondary legislation, and this decision will only be undertaken once a review of the voluntary programme has been completed.
So, at this level, the impact of the amendment is both limited in scope and delayed in terms of practical impact.
At another level however, this move is deeply significant. Here’s how.
1) The fact legislation has now been introduced demonstrates to all concerned that this is real. midata is going to happen. So, for companies, the question is no longer ‘should we bother paying attention to this?’ but ‘how should we respond?’
2) It’s not only real for energy, mobile phone, current account and credit card companies, it’s real for every other industry, both private and public sector in retail, media, travel and leisure, health, education and so on. Why? Because the data these organisation collect is also potentially valuable to their customers. In fact, (as the midata Hackathon last year showed) many of the really valuable innovations only become possible via new services which rely on new combinations of data from many different sectors. The obvious question now is if energy, mobile phone, current account and credit card companies are going to release their data back to customers, why shouldn’t every other company?
3) The longer the debate goes on, the more the idea of data release and information as a tool in the hands of the individual gets socialised. It wasn’t that long ago that the basic midata concept seemed utterly outlandish and dangerously radical. Now, like votes for working men and for women, it seems … well, obvious. Why on earth shouldn’t individuals be allowed to use their personal data for their own personal purposes? What sort of person or organisation would want to stand in the way of this?
4) Finally, the positive economic potential of this shift is being increasingly recognised, not only in the UK but internationally as Nudge author Richard Thaler’s recent article in the Harvard Business Review on ‘Smarter Information, Smarter Consumers’ shows. This is the catalyst of a whole new industry of life management and choice engine services for individuals, powered by personal data. It’s a source of jobs and revenues in its own right; a trigger for investment in skills and infrastructure; a driver of both innovation and more efficient markets; plus a means of reducing regulatory burdens (because so much regulation is required to compensate for the problems caused by consumers being disempowered rather than empowered).
A long journey
None of this is to say the journey is going to be easy. Scores of practical hurdles still have to be cleared. Data that’s released back to consumers has to be protected so that individuals’ privacy is not compromised and they can trust the process from start to finish. There are countless potential headaches with data quality, format, useability, comparability etc. Successful innovation is easy to talk about and hard to do, especially when it comes to identifying the real hot spots of value and designing positive user experiences. Everyone involved – companies releasing data and building new information sharing relationships with customers, information service providers, and consumers themselves – need to have a clear, compelling business case.
So there is a huge amount of work still to do. But we have turned a corner and the new personal data landscape is looming up at us ever faster.