Reinforced Data Approach of EU Showcases Ambitious Objective, Falls Short in Execution

EU Data Strategy: Navigating the Challenges Ahead

The European Commission has proposed a data strategy aimed at creating a common European "data space," a digital single market for data. However, the plan to mobilize sufficient funding for this strategy remains unclear, posing a significant challenge.

The EU data strategy calls for the creation of "personal data spaces" and an expansion of data portability requirements. Yet, the proposal for personal data spaces offers few details on who would provide these spaces or their feasibility. In the United States, venture capital-backed startups have struggled to provide personal data spaces due to a lack of consumer interest and healthy business models.

The European Commission's proposal comes at a time when funding may prove challenging, given the economic recession and delays in approving the new EU budget. The strategy requires funding of €4 to 6 billion, according to the European Commission. Building a European cloud is a protectionist project that may make it harder for non-EU companies to sell to the EU.

To succeed, the EU data strategy should be compatible with existing rules, clarify implementation details, and not impose additional costs on companies. All major U.S. cloud providers have data centers in Europe and offer customers the option to store their data in Europe. Non-EU cloud providers must still comply with EU laws.

The strategy asserts that the EU needs cloud providers owned and operated in Europe, but storing data within a country's borders does not necessarily make it more private and secure. The search results do not provide specific information on which companies are proposed by the European data strategy plan to create personal data spaces or ensure consumer data transfer capabilities.

Data portability can deter companies from collecting and storing data due to the requirement to provide users access to complex, disparate data sets in a reusable format. Separating personal and non-personal data can be costly for companies. The EU should amend data portability rights to account for the costs and technical difficulties they involve.

In a positive note, pharmaceutical research companies have begun sharing historical clinical trial data with outside researchers, and in the U.S. agricultural sector, successful private models enable farmers to share data. These examples suggest that collaboration and data sharing can yield benefits, provided the challenges can be addressed effectively.

The strategy aims to make it easier to share commercial data in nine different sectors, but this could conflict with the GDPR, particularly in the financial and healthcare sectors. It is crucial to ensure that the strategy respects privacy and data protection rights while promoting data sharing and innovation.

The EU runs a massive and growing trade surplus with the United States. The data strategy should strike a balance between promoting European data sovereignty and fostering international cooperation, ensuring that the EU remains a competitive and attractive market for businesses worldwide.