Data is becoming increasingly important in society and in the economy. A lot of money is also made with data, but until now the value of data was not reflected in statistics. Over the past year, CBS conducted research on how to fill that gap.
'CBS did do research on data,' says CBS researcher Hugo de Bondt. 'But not on what value those data represent. Our new research changes that.' The research into the value of data fits within the CBS Adequate Measurement of the Economy (AME) project and the desire to better capture intangible assets.
'We tried to look at the value of data as broadly as possible,' says De Bondt. 'This includes a lot of focus on definitions and qualifications. What exactly is data? And how can you put a price tag on it?' It's a tricky subject, he stresses. 'For example, we looked at how companies incorporate the value of data in their financial statements and balance sheets. But we hardly see the value of data there. So we came up with a workaround, inspired by the approach of Statistics Canada.' CBS estimates the value of data that companies manage based on the cost of obtaining that data. 'That's a proven method,' says De Bondt. 'To do so, we map different occupations and determine how much working time people in these occupations spend on data. Then we add up labor costs, storage costs and a profit percentage to arrive at a value.'
CBS uses existing sources, including the labor force survey (EBB) and the policy administration, in examining the value of data. De Bondt says the outcome is an estimate. "We calculated a high and a low scenario, within that range the actual value must lie. CBS compiled a time series from 2001 to 2017. This shows the development of the value of data in the Netherlands. 'That is interesting, for example for the Ministry of Economic Affairs and Climate which can use it to determine the importance for the Dutch economy.' At the National Accounts Department of the CBS, there has been discussion for some time about whether it is right that we do not include the value of data in the household accounts of the Netherlands. Especially since large tech companies do derive a lot of revenue from data. Our research contributes to that discussion by at least starting to establish that value.
The study shows that the value of data in the Netherlands measured in annual spending is between 15.6 and 20 billion euros in 2017 and is growing every year. Especially the data science category is growing strongly. The management of data storage, on the other hand, takes place very little in the Netherlands, De Bondt said. "That is often outsourced, for example to organizations in Asia. The government, including CBS itself, and education were excluded from the study on the value of data. 'We did not include these sectors because they do not 'own' the data. But ownership is always a tricky issue with data, especially when personal data is involved.
The research on the value of data was funded by the Ministry of Economic Affairs and Climate. The value of data is difficult to determine, Rogier de Boer of the ministry also emphasizes. 'This is because that value is not intrinsic, but only arises when you do something with the data. At the same time, we know that the most valuable companies in the world are data companies.' In the Netherlands, the sharing of data between companies is not yet as self-evident as thought and often not yet arranged in the most efficient way, De Boer observes. 'That is often done analogously and on an incidental basis, which is quite expensive and time-consuming. The interesting thing about data is precisely that you can reuse them infinitely and that the value increases as soon as you make them available to many others. I also think that we can use certain data streams much better to accelerate innovation.
De Boer sees the study that CBS has now completed as an initial exploration, which he believes will be followed up. 'Knowing what data are worth is important to substantiate why certain rules are needed and why the government supports certain initiatives.'
Data issues are increasingly higher on the political agenda, both in the Netherlands and within the EU, with attention being paid to both the risks and opportunities of increasing data use. De Boer: "As a ministry, we make policy on this and that is only possible if we have good figures. The figures produced by the research clearly show the enormous value of data, and the differences between the sectors are particularly interesting. For example, in the Netherlands the emphasis seems to be on data science and less on data storage. As a ministry, we would like to look for explanations for that fact.'
The publication 'The value of data 2001-2017 can be found on the CBS website.
