This is the second in a series of articles called “Nevermined: Big Data. Small effort”, meant to outline the current challenges companies face in handling data and the very simple, but highly effective solutions offered by Nevermined, a cutting-edge data sharing blockchain technology. #1
In the first article of this series we outlined how Nevermined enables companies to share data in an easy, secure and governed way. Now it is time to talk money and show you how Nevermined creates opportunities for new value streams.
From our experience, current data strategies are too defensive and focused on minimizing risk. This stands in the way of unlocking data’s real value. With Nevermined, companies can pivot from defense to offense. We enable them to make a major shift, from value obstruction to value creation.
In this article we want to dig a little deeper into each of the 3 new value streams Nevermined has impact on.
- Better products
- Direct monetization
- Net new products and businesses
BETTER PRODUCTS THROUGH BETTER INSIGHTS
This is the no-brainer: access to more data will create better insights, leading to better products.
Imagine, you’re a data scientist at Ford or any other traditional car company that is working on self-driving vehicles. You don’t have a huge amount of data to train your algorithms on, especially compared to Tesla with more than 40 billion miles of driving data.
Nevermined makes it possible for you to share data with competitors like GM, Honda, etc., so each participant of the data-ecosystem can train their AI and improve their product without exposing the source data to each other. Wouldn’t this come in handy? 😉
We’ll get into more technical details in our next article but , briefly, the concept is Nevermined allows you to bring the algorithm and computation to the data and not the other way round. It’s called Data In Situ Computation.
This mechanic of easily getting access to relevant data can also be applied within an organization. As the Head of Research from an international pharmaceutical company, you want to share data from clinical trials across research units, across countries. Again, the no-brainer thinking behind this: more data = better insights = better products.
But regulations like GDPR make it hard, expensive or even impossible to do that. With Nevermined the data doesn’t have to be moved, consolidated or copied to a 3rd party data sharing service. Insights can happen wherever the data is.
But for now, we’ll focus on the value that Nevermined creates in these situations, which is twofold:
- On the one hand, better products will have a positive impact on business metrics like pricing, margins, time to market,…
- On the other hand, the cost of data-sharing governance, procedures and workflows will dramatically decrease.
UP A NOTCH: DIRECT MONETIZATION
Moving beyond cost displacement and product improvement, Nevermined also enables companies to monetize their data and data-related assets. We don’t just make it easy and secure to share data across organizations, we also make it easy and secure to add payment conditions.
Defensive data strategies focus on protecting data for internal use, by building gates around it. With Nevermined it’s possible to open your gates and start charging people for entry.
Whether you’re a telco or a bank or an airplane manufacturer, you’re sitting on data that might be valuable for other organizations. An insurer might want access to credit card data from a bank in order to fine-tune their risk assessments. A media company might want access to geo-location data from a telco in order to analyze campaign impacts. Currently, this doesn’t happen or it happens through expensive and slow ‘data partnerships’, facilitated by 3rd party services that lack agility.
So why spend money on maintenance, security and governance when Nevermined can help you monetize the data directly?
The same mechanic can also create value for internal processes. Imagine, the retail unit of a bank in Germany is putting together a Global Consumer Trends report. They know that their colleagues in Asia have useful data, but they find it impossible to get permission to use it.
Business units or subsidiaries have little incentive to share data. Not only is it cumbersome from an architecture and compliance point of view, there is no real economic incentive. “We paid for it and maintain it, so why share it?”
With Nevermined, the team in Asia can offer it up, at a price, to the whole company and recoup some costs. And the German team no longer needs to go through lengthy, internal governance procedures. They just click.
The technicalities of this, too, will be explained in another article, but the principle is simple: you don’t move the data, but allow algorithms and compute to securely enter your environment, at a price.
Oh, and tokenization! That’s another key aspect of Nevermined. Tokenization is the concept of having ‘something’ represented by an immutable, transferable digital asset. The market is very familiar with tokens as money or art but all value can be tokenized. Take the cases we described above, where a token can represent an existing data set. But what if you could monetize your algorithm? Or an insightful report? Or anything data-related, really.
We can do that. Say, two data owners allow for a 3rd party analyst to do an analysis across their datasets. This results in a net-new data asset. With Nevermined you can set the conditions in such a way that each of the original data owners can have a shared co-ownership of the new data set. Which, of course, can be monetized. Ad infinitum.
FULL BLAST: NEW PRODUCTS/BUSINESSES
Now, with Nevermined, organizations can go up another level, where the impossible becomes possible.
The net-new creation of value on the magnitude of $3 trillion annually. That’s what McKinsey estimates to be the value of connecting data across institutional and geographic boundaries. That’s huge! We believe that a big chunk of that will come from the development of new products and even companies that are based on data sharing.
At Nevermined we have already worked with a European telco, who saw this potential early on. They reached out to an international insurance company and together they created a new product, which effectively turned into a new joint venture. The key enabler was the fact that they could use Nevermined to share data without the costs associated with governance, data consolidation and 3rd party data management. Estimated annual revenue from this new product: $300million. Now, that’s a new value stream!
But this is just one example. Really, the sky’s the limit. Taking away the bottle necks for data sharing is a super power for your innovation teams and business developers.
The question you need to answer is: what can we do when we bring together a variety of data sets with a range of data science and AI? What problems can we solve? What new products can we create?
SOMETHING FOR EVERYONE
Moving your data strategy from defense to offense can create value on different levels: from new insights, over direct monetization to developing new products.
But there is one red thread through each of these new value streams. A big chunk of the $3 trillion that McKinsey mentioned will be captured by companies who understand that the key is in collaboration, in the creation of data ecosystems. So when we said in the previous article that we are rocket fuel, this is what we mean.
Nevermined is the rocket fuel that allows business units/organizations to collaborate, leveraging data and knowledge that was previously inaccessible.
Get in touch, book a demo!
In the next article we’ll go under the hood and elaborate on a few of the technical components that make this possible.
Originally posted on 2021-10-22 on Medium.