Open data: what it is and why business should care
Governments and organisations around the world are opening up data for free use. A look at the practical opportunities this creates.
In recent years the open data movement has been gaining momentum. Governments in several dozen countries have started publishing statistics, registries, geographic data, and other information for public use. In the US and UK such portals have been running for several years now, and the volume of available data is already substantial.
For business this is not just a policy initiative. It is the emergence of a new layer of information that can be used - for free or at minimal cost - for analytics, products, and services.
What open data actually means
Open data is data that is officially permitted to use, copy, distribute, and modify without restrictions or with minimal conditions such as attribution. This is fundamentally different from data that is merely "publicly accessible" - visible on a website but technically protected by copyright.
Typical sources: government statistics (demographics, economics, industries), business registries, geospatial data, transport and infrastructure data, results of government-funded research.
Quality and completeness vary widely. Some open data is well-structured and regularly updated. Some is outdated exports in inconvenient formats. That is worth factoring in.
Where this is practically applicable
I see a few scenarios that are relevant right now for different types of business.
Market and geographic analysis. Demographic statistics, income data, business registries - these allow you to assess potential demand in regions without expensive research studies. Particularly useful when choosing new locations or evaluating new markets.
Enriching your own data. If you have a customer database with addresses, linking it to geographic data, transport routes, and population density data allows you to build more accurate models. This is cheaper than buying commercial geodata.
Competitive landscape monitoring. Company registries, procurement data, industry statistics - sources from which you can build a picture of a market without expensive analyst agencies.
Product services. Some companies build products entirely on open data - real estate aggregators, transport apps, services that monitor public tenders. This is an example of using open data as raw material for creating value, and it maps directly to thinking about the company as a platform built on open data and APIs.
What to keep in mind
Open data does not mean high-quality data. Data quality must come before analytics - and open sources are no exception. Before building anything on a specific source, it is worth understanding how regularly it is updated, who is responsible for it, and whether the methodology has changed in recent years.
Licence conditions differ. Most open data allows commercial use, but not all of it. This needs to be verified for each specific source.
Processing requires effort. Raw open data is rarely ready to use as-is. Normalisation, cleaning, enrichment - this is real work that needs to be planned for.
How to start
If you want to understand which open data is relevant to your business, start simply: write down three to five questions you wish you had data to answer. Then check whether an open source exists that addresses them.
Often it turns out the needed information has existed for a while - nobody just knew it was available for free.