Value tied up in your data

how does a company measure or place a value on their data? In a MIT Sloan Review article titled “What is your data worth?” which mentioned the 26 billion dollar acquisition of LinkedIn by Microsoft and asked the question. Did they pay a fair price for purchasing LinkedIn’s network user data? Microsoft seemed to think so but then the credit rating agency Moody, on the announcement conducted a review of Microsoft’s credit rating. Point being, there still is no exact formula for placing a value on data or information. According to a data valuation surveyconducted by Steve Todd of Dell EMC, that interviewed 36 companies with revenues over 1 billion, found that these companies focused more on the challenges of storing, protecting, accessing, and analyzing massive amounts of data, and not as much on transforming or quantifying its business value.

The research firm Gartner predicts that by 2022, companies will be valued on their informationportfolios. Current GAAP accounting standards do not permit data (intangible assets) to be capitalized on the balance sheet. Which currently can lead to considerable differences between the book value and market value of a company, if a tech company wants to IPO, it can lead valuation pricing issues.

Which leaves many analysts wondering especially for information-rich companies should data be counted as a tangible asset.



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