“Mashups” -- applications that take information from multiple sites and make them accessible at a single site -- are growing in popularity. Consider Kayak.com, which lets users compare airfares by searching multiple travel sites. The application automatically visits multiple sites and compares the data, extracting and reusing the relevant Web data, often in innovative ways, to make the information more valuable to users.
Among Web developers and users of these applications, there's enthusiasm for reusing data this way. But the companies originating the information often try hard to control who can use what they consider their data, and how it gets reused. Online travel company Expedia Inc. sent a “cease and desist” letter to Kayak, and Kayak now doesn't incorporate data from Expedia and four other sites in its search results.
Does Expedia actually own the data on its Web site? How can online data be owned and controlled if it's so openly accessible? What's the best strategy for those who believe they own the data? And what's the best strategy for those who want to reuse it?
When a company makes data accessible to the public on the Web, intellectual property law determines ownership of that data. When considering databases that contain mundane facts, such as airfares, and are publicly accessible, companies can't claim trade secrets, trademarks or patent protections. But what about copyrights? Copyright protection cannot be claimed for individual facts stored in databases when those facts are openly accessible.
However, the issue is still murky, and copyright law is evolving. So, in the face of uncertainty, what should companies that create databases do? It's always good to be vigilant about those who extract your data to re-create an identical copy of your database. However, this is less likely than a company reusing your information to create a significantly different database that has richer data and functionality. You may not have legal means to protect your database, but you can consider data repurposing: That is, you should find innovative ways to make your data valuable to broader market segments. First, consider selling “private” data not related to your openly accessible data. Second, try reusing your data yourself, but offer better and more creative services.
Regarding selling private data: A company offering open access to certain data likely also has certain private data that combined makes the set unique. And, like other types of information goods, a unique database has much less competition and can often be sold with a good profit margin. For example, from eBay's Web site, one can obtain only the bidding price history for an active auction item. The actual transaction prices are not available more than 10 days after the close of the auction. The historical prices for similar items are also not openly available from eBay's site. Neither are the quantities sold at different prices. Such information is vital to people who want to analyze online auction markets for purposes such as auction mechanism design and auction trend analysis. Realizing that the data combined with auction prices can serve other purposes, such as market research, eBay is now selling such data directly via licenses, as well as through resellers.
Alternatively, if you want to become a reuser, you may, in fact, find opportunities to expand your business. For example, shipping carrier United Parcel Service Inc. owns iShip Inc., a data reuser that compares shipping charges for multiple carriers. It's best to focus on using technology to construct a unique database that will add value to existing data, whether through differentiation or data analysis.
Differentiation can vary. Most price comparison sites reuse data from a wide range of vendors. They add value by improving efficiency: Their site becomes the place to go to in order to search for deals in the fastest way possible. They can further differentiate their databases by improving the quality of the data and adding functionality to the database. For example, AddAll.com reuses price data intentionally. It presents data in a uniform currency that the user chooses, even though the original data may be in other currencies. Therefore, its data has higher value because it's easily interpretable and more usable than the data in its original source.
Finally, you could use the integrated data to make better decisions for your company, or offer services to help others make better decisions. BizRate.com, for instance, is a price comparison site that also analyzes the searches and click streams to its database so that it can produce market analysis that it sells to market research firms and retailers.
If your company has an extensive Web site, chances are that you've made a database available for others to reuse. So it's best to come up with innovative ways to use the data or to reuse data from other companies.
This article is adapted from “Finding New Uses for Information,” by Hongwei Zhu and Stuart E. Madnick, which appeared in the Summer 2009 issue of MIT Sloan Management Review. The complete article is available at http://sloanreview.mit.edu/smr/.