Data assurance market

The Open Data Institute (ODI) has published findings from a research study by Frontier Economics and glass.ai analysing the size and scope of the UK data assurance market

This research was conducted in June and July 2021 as part of the ODI’s wider programme of work on data assurance, aimed at improving the data practices of organisations so that they can build and manage adequate data infrastructure and data use. It is the latest ODI work to deepen understanding of the UK data ecosystem and supports the opportunity set out in the government’s Plan for Growth for the UK to become a global digital and data services hub.

Frontier economics: Review of the UK business-to-business data assurance market (PDF)

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The ODI’s data assurance programme lead, Deborah Yates said:

“This project has revealed a potentially significant market opportunity for organisations like the ODI that are concerned with increasing trust in data and data practices. We expect to see high growth in years to come, as more organisations grapple with demand to build confidence with customers, shareholders and the public. As we’ve recently highlighted in our response to the government’s consultation on restoring trust in audit and corporate governance, data assurance practices are at the heart of building confidence in the way that UK companies are run and scrutinised. At the ODI, we’re looking forward to working with the market to develop practices, products and services in this increasingly significant area.”

Method

As part of the research, Frontier Economics set out to discover:

  • the number of firms in the UK data assurance market
  • the overall size of the market
  • the location of firms in the market
  • the traditional sectors in which the firms operate.

To carry out the analysis, researchers used a web-crawling approach that ‘reads’ more than two million UK business’s websites. It also looks at news, social media, events and Companies House data to identify patterns and trends based on certain keywords provided by the researchers. These included 16 ‘foundational’ terms, including data certification, data sharing and IT governance, as well as eight characteristics of trustworthy data, 15 data assurance services, five data assurance products, and six terms related to avoiding negative outcomes.

Key findings

Researchers quantified the size of the data assurance market based on the number of firms active within it, the employees working for these firms and their overall turnover. They found:

  • 890 data assurance firms are operating within the UK - that is, firms that matched against at least one of the data assurance search terms;
  • Approximately 30,000 staff are involved in the delivery of data assurance in the UK
  • The majority of data assurance firms adopt a consulting business model (669 firms)
  • These firms target their offerings at specific kinds of customers, including retailers, distributors and advertising firms
  • Other data assurance firms offer a subscription (73) or licencing service (37) to clients which tends to feature a mix of platform access and ongoing sharing of expertise.

The team also found that:

  • The value of the data assurance market services spills over and may therefore benefit not only the direct clients of the data assurance firms but also the wider economy.
  • The overall economic value associated with greater data sharing is potentially vast. Even a small data assurance-inspired increase in data sharing can be significant.  An earlier Frontier Economics report, commissioned by the ODI showed that data sharing can help generate social and economic benefits worth between 1% and 2.5% of GDP when public-sector and private-sector data are combined.

The data assurance sector is largely made up of SMEs

  • 56% of the firms who are engaged in data assurance activities had 10 or fewer employees and 87% have fewer than 50 employees.

The data assurance market is also relatively young:

  • 58% of the data assurance firms identified in the study were incorporated in the last ten years
  • The entry of data assurance firms to the market is roughly in line with the same pace of all businesses entering the economy. This could signal an opportunity for more rapid growth in future if demand grows in line with trends in data availability.

Data assurance activity is spread across many different clusters of economic activity:

  • Most firms are in the technology (67%) and professional services (26%) sectors

Most companies involved in data assurance services appear to operate within a specific market niche:

  • 77% of firms identified only matched against a single keyword or phrase, with 16% matching against two terms and 7% matching against three or more
  • 72% of the firms we identified were linked to one of the top 10 most frequent topics. Data management, data governance and data security were the most frequently matched topics.

Frontier Economics’ Director of Public Policy, Sarah Snelson said:

“The findings of this new piece of research show a healthy and growing data assurance sector in the UK which has the potential to spark further economic growth throughout the wider economy. This is a new industry that appears to have the potential to grow rapidly with the increased use of data. These firms are currently mostly SMEs who could experience growth in the future. However, some larger more established professional services firms also include data assurance offerings as part of a broader offer.”