DataMarket – Energy: New Business enabled by Open Data
Last week DataMarket introduced a new product, an energy specific data service called simply: DataMarket – Energy
The venue at which we introduced the service was quite unusual. We were lucky enough to be invited – along with a selected group of other startups and innovators working with energy data – to present our work at the White House at an event called Energy Datapalooza. We have since jokingly said that in order to top this venue for our next product announcement, we will have to book the International Space Station. I’m working on that.
Here’s a short video of my presentation there and the unveiling of our new service:
For those of you that have been following DataMarket for a while, you will notice that the business model for this new product is significantly different from what we have previously been running with.
When we originally kicked DataMarket.com off with international data early 2011, there was only one thing users could pay us for: A low-priced premium subscription that gave access to additional features, such as more advanced data export formats, automated reports and a few other things. A couple of months later we added the first premium data to the site; data from premium data providers such as the Economist Intelligence Unit (links to EIU data on DataMarket), resold through our site.
However, using the site’s core functionality – the ability to search, visualize, compare, and download data from the vast collections of Open Data that we aggregate – has always been free. As such, DataMarket.com has become quite popular in certain circles. But quite frankly, the two revenue sources have not taken off in a big way.
What has however taken off is our technology licensing business. We’ve seen high demand for our data delivery technology from other information companies. The ability to normalize data from a wide variety of data sources, and enable users to access that data through powerful search and online visualization tools is something many information companies, such as market research and financial data companies, have identified a strong need for. So last February we formally introduced our data publishing tools, most prominently what we now call the Data Delivery Engine, a white-label solution that is already up and running for a few well know information companies, (including Yankee Group and Lux Research) with several other in the implementation stages. This licensing business is where most of our revenues comes from today, so one could really say that we’re now more of a software company than a data company.
The upcoming launch of DataMarket – Energy is another stab at the data side of the equation, but the approach is different in several ways:
- Focus and scope: By focusing on a single industry or vertical we can make the service much more relevant to its users. Instead of solving 10-15% of everybody’s data needs with the kind of macro-economic and demographic data that can be accessed on DataMarket.com, we aim to address 90-100% of the data needs of a much more targeted audience.
- Premium access: We’re selling access to this service at a substantial premium (final pricing is still being decided). Those that see value in the discovery and aggregation services that we add on top of the data will be charged for the “job they hire our product to do”. This indeed means that some data that has been made publicly available for free (Open Data) will only be available to DataMarket users behind a paywall. As explained in the presentation above, that doesn’t take the least bit away from the value of the Open Data. On the contrary: The data is still available in its original form from the publishing organizations, but we add a choice on top of that: A nicer and more user friendly way to access the data for those that are willing to pay for that value-add.
- Targeted sales: Instead of relying as much on PR and viral distribution as we have with DataMarket.com, we’ll use more direct, traditional sales approaches for this new service.
One of the interesting things about running a technology startup is that the same technology can be turned into so many different products without a single line of additional code. Often the only difference is how you promote it, price it and sell it. This can be both a curse and a blessing, and usually a few things need to be thrown at the wall before you find what sticks. Luck is involved too, but as the famous
Norwegian Swedish alpine skier Ingemar Stenmark is quoted saying: “The more I practice, the luckier I get“.
It will be interesting to see if we’ve practiced our data marketing skills enough for the DataMarket – Energy approach to work out.