The Flow Report - 2024 in review
Data supply risk in 2024 can be characterized by two major themes: data companies operating at scale, and a rebalancing of the norms around commercializing user data. On the former, data and research companies are now subject to risks faced by mature companies, such as cybersecurity attacks, widespread adverse media, and survival at scale. With respect to norms around user data, artificial intelligence has reopened the debate on ownership, collection, and transformation of "public" data. Glacier expects that in 2025 we will see further consolidation and looser regulation in favor of data collection as the United States, the primary market for emerging tech, adapts to a new administration.
Below are some noteworthy examples of the pitfalls of data companies operating at scale in 2024.
Adverse media
Location data (generally) - Starting with Q1 actions against X-Mode and later Gravy Analytics (which merged with Unacast), the Federal Trade Commission has continued its campaign against vendors that track consumer movements where consent may be unclear or lacking, particularly "precise location data" (tracking an individual within 1,850 feet) near "sensitive locations" (such as places of worship or abortion clinics). 404 Media has pursued related stories involving other well-known vendors such as Babel Street.
YipitData - Litigation in New York between Yipit and former employees of competitor M Science have dragged the industry into the spotlight. Many industry participants would've preferred otherwise. The individual defendants seem motivated to settle quickly, given their (public statements of their) limited resources to mount legal defenses.
Cybersecurity
Change Healthcare - No doubt the most impactful breach in this space in 2024. This attack resulted in months of interrupted healthcare, remediation, congressional hearings, and has prompted many to re-evaluate healthcare data governance.
CDK Global - It was not a good year for vehicle data, and CDK was no exception.
Survival
Cybersyn - As data companies aim to become larger and reach more users with broad appeal, costs can go up and runway shortens. Unfortunately, Cybersyn is among the companies that folded in 2024.
Knoema - Recently, Knoema seems poised to join them.
Predictions for 2025 – “public” data
Glacier expects 2025 to raise the stakes on the big questions surrounding ownership of publicly accessible data collected at high volumes. In the near term, we are likely to see more lawsuits and one-off paid licenses between established content creators and VC-backed AI startups; however, Glacier anticipates that longer term, these disputes will follow the established pattern in the United States - courts will support the development of lucrative technology over individual creators’ rights, and large corporations will prevail over smaller plaintiffs with potential copyright claims. Specifically, this trend is likely to involve -
AI companies hunting for valuable proprietary datasets in unexpected places,
Legal opinions accommodating model training and scraping into existing law, and
Re-negotiations between vendors and data buyers on AI-related use cases as deal norms develop.
This will occur against the backdrop of sophisticated platforms with walled gardens deploying -
more defenses against web scraping (and even proxy IPs?),
an avalanche of changes to boilerplate website terms and conditions, and
more expensive APIs.
In the meantime, it’s worth watching the Bright Data/X Corp. litigation closely. Several of the above issues are playing out now in this case, with new types of claims (particularly those grounding legal “harm” in costs such as server capacities, site traffic, scraping defenses, etc.) bringing some of the more aggressive scraping tactics into the public debate.
For a review of the trends Glacier covered in 2024, please see our blog.
See you in the new year,
Don D'Amico
Glacier Network, Founder & CEO
©2024 Glacier Network LLC d/b/a Glacier Risk (“Glacier”). This post has been prepared by Glacier for informational purposes and is not legal, tax, or investment advice. This post is not intended to create, and receipt of it does not constitute, a lawyer-client relationship. This post was written by Don D’Amico without the use of generative AI tools. Don is the Founder & CEO of Glacier, a data risk company providing services to users of external and alternative data. Visit www.glaciernetwork.co to learn more.