The data economy is on track to become one of the largest economic sectors globally, according to a new report by Dubai Future Foundation (DFF) and Dubai Economy.
The rapid accumulation of data on smart devices has driven the development of several innovative businesses that are enabled by data and it has led to the emergence of the global data economy in which firms and countries are collecting, processing and analyzing data to generate insights but also underpin artificial intelligence (AI) and machine learning algorithms and create new value leveraging advanced technologies.
According to the report titled ‘New Data Economy’, the global market for big data is predicted to touch $243.4 billion by 2027, more than trebling from the $70.5 billion in 2020.
Companies and governments are using data to increase efficiency, streamline operations and derive strategic insights with a level of accuracy that was not previously possible, the report said and it further highlights the growth of this economy across the world.
In advanced economies, like Germany, the UK and the Netherlands, the data economy already represents around seven to 10 percent of the GDP and is expected to double over the next few years.
“The UAE and Dubai are considered a leader in harnessing the immense potential of data. Dubai Future Foundation is keen on enhancing collaboration with stakeholders around the country and globally to study the future of data, identify emerging trends and devise strategies to leverage data that will create added value. The Foundation also assists public and private sector entities in developing digital systems and data management policies. The new report, published in collaboration with Dubai Economy, provides recommendations to accelerate data exchange and utilization and encourage investments in the data sector.”
Role of data in economic sectors
According to Google’s estimates, the value originating just from Search and Maps data in the UAE is around $2.7 billion a year. This value can be optimized if data is used more efficiently, the company stated.
The report examines the role of data as a key driver of economic sectors, for instance, the availability of geographic information system (GIS) data led to the growth of satellite GPS applications, an industry that has become a critical enabler of the global transport and logistics sector.
In the healthcare sector, data sharing and analytics across research institutions and hospital facilities have driven the emergence of the precision medicine industry. The global precision medicine industry is expected to be worth $105 billion by 2026.
The report recommends stepping up collaboration among various stakeholders to improve data quality and management. This approach will allow government entities, private sector corporations, startups and innovators to access and exchange open-source data with researchers and other interested parties to reduce time and cost associated with R&D, and data gathering and classification.
Other suggestions include developing existing open data platforms, fast-tracking data exchange through hybrid data-sharing models, such as data trusts, curbing anti-competitive practices by large data holders and aligning data-sharing requirements with the needs of specific sectors.
Dubai has been at the forefront of technology adoption since it announced the first ICT strategy in 1999. It was followed by initiatives such as e-Government, m-Government, Smart city, open data, autonomous transport and the mandating of blockchain for government transactions. The emirate’s integration of digitalization into government service and economic development strategy makes it stand out in the region.
Mohammad Shael Al Saadi, CEO of the Corporate Strategic Affairs sector in Dubai Economy, said, “During the pandemic, national strategies have further emphasized the role of the Digital Economy as a priority sector. Moving forward, we need to power ahead of the competition with our digital innovation, business-friendly data policies and technology investments to ensure maximum returns for our society, business and economy.”