Page 31 - ITU Journal - ICT Discoveries - Volume 1, No. 2, December 2018 - Second special issue on Data for Good

ITU JOURNAL: ICT Discoveries, Vol. 1(2), December 2018

THE GENERAL DATA PROTECTION’S (GDPR) IMPACT ON DATA-DRIVEN BUSINESS MODELS:
THE CASE OF THE RIGHT TO DATA PORTABILITY AND FACEBOOK

Moritz Böhmecke-Schwafert, Crispin Niebel
TU Berlin

Abstract – The General Data Protection Regulation (GDPR) has recently come into force and will have wide
implications for the digital economy and the business models of various tech firms, as well as providing new
opportunities for innovation. The GDPR aims to provide consumers with the control of their personal data,
provide trust in the digital economy and harmonize data protection throughout the EU pursuant to the
Digital Single Market strategy. This paper attempts to analyze and outline how the GDPR might change the
data-driven business models (DDBMs) of firms, yet nonetheless they may lead to a variety of positive effects.
Indeed, the principles and individual rights in the GDPR tackle monopolistic structures (and lock-ins), and
they can increase the quality of data and digital provisions as a result of competitive pressures, as well as
promoting consumer trust in the digital market. One of the individual rights and newer features introduced
by the GDPR, namely the right to ‘data portability’, will be considered with regard to the case of its impact
on Facebook’s DDBM.

Keywords – Business models, data economy, data portability, Facebook, GDPR, innovation, trust

1. INTRODUCTION

The surge in digital technologies and platforms in The structure of this paper is as follows: Section two
recent years and the progression towards a digital will provide an overview of the data economy,
economy has at its core the monetization of digital business models, the GDPR and data
personal data and the use of ‘Big Data’ to create portability. Section three will outline Facebook’s
value (see [1]). Hence, many firms have capitalized business model within Hartmann et al.’s [1]
on data-driven business models (DDBMs) such as framework illustrating the impact of the GDPR’s
the social media company Facebook Inc. that right to data portability with consideration of
became a global leader and a multibillion-dollar consumer trust, the nature of the digital economy,
business in less than one decade. digital markets and competition, as well as
interoperability between platforms.
The introduction of the EU General Data Protection
Regulation (GDPR) introduces sweeping changes to 2. BACKGROUND
the digital environment, most notably
compromising traditional business models and 2.1 Data economy
mechanisms regarding the collection, processing
and use of personal data. It should be noted that, the Data has become an integral part of our way of life.
totality of the GDPR with its various principles and The gathering of data and its subsequent
rights interacting with one another will have a far commercialization has transformed contemporary
more widespread and multidimensional impact on economies, politics, societies and cultures. In the EU
DDBMs that cannot be captured within the limited for example, the value of the data economy is
scope of this paper. Rather, using Hartmann et al.’s continuously increasing. In 2016, the value was
[1] taxonomy for DDBM of start-ups as a basis of calculated to be EUR 300 billion (1.99% of the EU’s
analysis, the paper seeks to provide a case study GDP) and is estimated in 2020 to be EUR 739 billion
outlining the effects of one of the more unique (4% of the EU GDP) [2]. Indeed, over the last
features of the GDPR, namely data portability on the few decades multinational companies have
DDBM of the social media company Facebook. mushroomed with several of them ascending very

© International Telecommunication Union, 2018 9