With all the attention that big data’s place in the enterprise has been getting in the press as well as the coverage of a number of high-value data purchases and exchanges, people are beginning to wonder, “How much is my data worth?” Despite the volume of money being invested in data and data technology, methods for answering this question are severely lacking. In this talk, we will discuss relevant concepts to data’s valuation from related fields, the characteristics of data that make it unique from other economic goods, and practical considerations for how to begin thinking about the general value of data for the enterprise. Presented by Chloe Mawer, Data Scientist at SVDS.

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What is Your Data Worth?
Chloe Mawer
Data Scientist, SVDS
SVDataScience

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UNSTRUCTURED
Data Science POP-UP in Seattle
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Produced by Domino Data Lab
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3. What is your data worth?
UNSTRUCTURED Data Pop-Up Seattle
October 7, 2015
Chloe Mawer |@chloemawer

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@SVDataScience

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How much is my data worth?

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How much is my data worth?

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Information goods
Information does not adhere to three main features
of the traditional market system:
1. Excludability
2. Rivalry
3. Transparency
DeLong and Froomkin, 2000; Varian, 1995;
Varian, 1999;Dou and Wu, 2015

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Intangible asset valuation
Intangible assets: non-physical assets with
commercial value but not in a form eligible for
traditional IP law protection.
Three main models:
1. Cost-based
2. Market-based
3. Income-based
Matsuura, 2004

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Added complexity of data

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How much is my data worth to others?

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Other considerations
• Completing the chain
• First copy costs
• Liability
• Substitutes

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The data market (or lack thereof)
• Data marketplaces have been bought by
aggregators.
• Data exchanges occur through aggregators or 1:1
deals.

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How much is 3rd party data worth to me?

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Buying data
• Completing the chain
• First copy costs
• Substitutes
• Liability

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External data’s value to you
• A/B testing
• Value of information (VOI) framework
VOI = Expected value of decision using data
- Expected value of decision without data

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What is my data worth within the organization?

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Assessing current data value
• Mutual information (MI)
MI = Information entropy without added data
- Information entropy with added data
• Take inventory

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Increasing data’s value in your
organization
• Accessibility
• Integration
• Ease of use
• Coverage
• Completeness
• Accuracy
• Latency
Choose metrics that are easy to measure and suited
to your business.

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Data breach or loss
• How much PII do you have?
• What trust could you lose from your customers?
• Average $154 per record
• $363 healthcare
• $300 education
• $165 retail
• $121 transportation
• $68 public sector 2015 Ponemon
Institute Cost of Data
Breach Study

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• Unique properties of data make
it difficult to value.
• Buying and selling is taking
place 1:1 or via aggregators.
• Method for valuing data for
internal use depends on
intention.
CONCLUDING
THOUGHTS

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