Data portability and interoperability: A primer on two policy tools for regulation of digitized industries

Article by Sukhi Gulati-Gilbert and Robert Seamans: “…In this article we describe two other tools, data portability and interoperability, that may be particularly useful in technology-enabled sectors. Data portability allows users to move data from one company to another, helping to reduce switching costs and providing rival firms with access to valuable customer data. Interoperability allows two or more technical systems to exchange data interactively. Due to its interactive nature, interoperability can help prevent lock-in to a specific platform by allowing users to connect across platforms. Data portability and interoperability share some similarities; in addition to potential pro-competitive benefits, the tools promote values of openness, transparency, and consumer choice.

After providing an overview of these topics, we describe the tradeoffs involved with implementing data portability and interoperability. While these policy tools offer lots of promise, in practice there can be many challenges involved when determining how to fund and design an implementation that is secure and intuitive and accomplishes the intended result.  These challenges require that policymakers think carefully about the initial implementation of data portability and interoperability. Finally, to better show how data portability and interoperability can increase competition in an industry, we discuss how they could be applied in the banking and social media sectors. These are just two examples of how data portability and interoperability policy could be applied to many different industries facing increased digitization. Our definitions and examples should be helpful to those interested in understanding the tradeoffs involved in using these tools to promote competition and innovation in the U.S. economy…(More)” See also: Data to Go: The Value of Data Portability as a Means to Data Liquidity.