An iTunes model for data

Datasets as albums? Entities as singles? How an iTunes for data might work.

iTunes and a spreadsheetAs we move toward a data economy, can we take the digital content model and apply it to data acquisition and sales? That’s a suggestion that Gil Elbaz (@gilelbaz), CEO and co-founder of the data platform Factual made in passing at his recent talk at Web 2.0 Expo.

Elbaz spoke about some of the hurdles that startups face with big data — not just the question of storage, but the question of access. But as he addressed the emerging data economy, Elbaz said we will likely see novel access methods and new marketplaces for data. Startups will be able to build value-added services on top of big data, rather than having to worry about gathering and storing the data themselves. “An iTunes for data,” is how he described it.

So what would it mean to apply the iTunes model to data sales and distribution? I asked Elbaz to expand on his thoughts.

What problems does an iTunes model for data solve?

Gil Elbaz: One key framework that will catalyze data sharing, licensing and consumption will be an open data marketplace. It is a place where data can be programmatically searched, licensed, accessed, and integrated directly into a consumer application. One might call it the “eBay of data” or the “iTunes of data.” iTunes might be the better metaphor because it’s not just the content that is valuable, but also the convenience of the distribution channel and the ability to pay for only what you will consume.

How would an iTunes model for data address licensing and ownership?

Gil Elbaz: In the case of iTunes, in a single click I purchase a track, download it, establish licensing rights on my iPhone and up to four other authorized devices, and it’s immediately integrated into my daily life. Similarly, the deepest value will come for a marketplace that, with a single click, allows a developer to license data and have it automatically integrated into their particular application development stack. That might mean having the data instantly accessible via API, automatically replicated to a MySQL server on EC2, synchronized at Database.com, or copied to Google App Engine.

An iTunes for data could be priced from a single record/entity to a complete dataset. And it could be licensed for single use, caching allowed for 24 hours, or perpetual rights for a specific application.

What needs to happen for us to move away from “buying the whole album” to buying the data equivalent of a single?

Gil Elbaz: The marketplace will eventually facilitate competitive bidding, which will bring the price down for developers. iTunes is based on a fairly simple set-pricing model. But, in a world of multiple data vendors with commodity data, only truly unique data will command a premium price. And, of course, we’ll need great search technology to find the right data or data API based on the developer’s codified requirements: specified data schema, data quality bar, licensing needs, and the bid price.

Another dimension that is relevant to Factual’s current model: data as a currency. Some of our most interesting partnerships are based on an open exchange of information. Partners access our data and also contribute back streams of edits and other bulk data into our ecosystem. We highly value the contributions our partners make. “Currency” is a medium of exchange and a basis for accessing other scarce resources. In a world where not everyone is yet actively looking to license data, unique data is increasingly an important medium of exchange.

This interview was edited and condensed.

Photos: iTunes interface courtesy Apple, Inc; Software Development LifeCycle Templates By Phase Spreadsheet by Ivan Walsh, on Flickr

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  • http://ideaapps2cash.com Marie

    Nice article with lots of great information competitive biding sounds GREAT to me!