Europe’s Data Act redraws the boundary around connected product data
Access to data from connected products could open new markets for industrial services. Derived insights, trade secrets and personal information retained important protections.
An industrial company might operate a connected machine for years without being able to give an independent service provider the machine’s operating data. The European Data Act addressed that imbalance. Parliament’s approval on 9 November 2023 followed a political agreement on a framework for users to access data generated by connected products and related services, and to share it with third parties.
For an industrial software startup, that created a prospective route into maintenance, optimisation and other aftermarket services. Manufacturers retained protections for information outside the access right. A business needed to understand which measurements it could obtain, which information remained protected and what work would turn the available data into a useful service before assuming access to an installed equipment base.
The user gains a route to the measurements
The agreed legislation requires covered product data and related service data, with the metadata necessary to interpret them, to be accessible to users. Where direct access is unavailable, a data holder must make readily available data accessible under the specified conditions. A user can also request that data be supplied to a third party. The user therefore gains a route to data even when the manufacturer controls the interface.
Consider a factory seeking help with machine downtime. An independent analytics supplier could build its offer around data the factory is entitled to request. The useful commercial question is which measurements actually exist: vibration readings, operating hours or fault codes have different value. An access right does not create a missing sensor, improve a poorly calibrated one or supply the maintenance history needed to interpret an anomaly.
Where the data access right ends
The legislative text distinguishes raw and preprocessed product data from information inferred or derived through additional investment. Its recital on scope excludes such inferred or derived information from the mandatory sharing requirement unless the parties agree otherwise. A startup should therefore distinguish a machine’s available operating signals from the manufacturer’s proprietary assessment of component life. Treating both as equally accessible would overstate the input available to a new service.
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| Comparison | Covered operating data | Additional analytical information |
|---|---|---|
| Example | Available sensor readings and relevant metadata | An assessment inferred through additional analytical investment |
| Access question | Does the user’s request meet the Data Act’s scope and conditions? | Is access available through a separate agreement? |
| Startup work | Validate quality, continuity and permission to use the data | Develop the analytical capability or negotiate access to it |
The distinction in recital 15 and the product data sharing provisions. Safeguards for personal data and trade secrets still apply.
Trade secret protections can require agreed technical and organisational safeguards; exceptional circumstances can support withholding particular data where the statutory conditions are met. Processing personal data still needs a valid basis under data protection law. Data recipients also face restrictions on using shared data to develop a competing connected product. These limits support aftermarket competition without requiring a general transfer of product know-how.
An interface is only the beginning of distribution
Even with access, selling an industrial service requires a credible integration plan. Different machines can expose different sampling rates, timestamps and error conventions. A model that works on one installation may need substantial adaptation elsewhere. Reliable integrations and validated operational recommendations can give a supplier an advantage that survives competitors gaining access to the underlying measurements.
Pricing also needs to reflect the actual arrangement. Free access for the user should not be confused with a universal requirement that every business recipient receives every dataset without compensation. The text provides rules governing business-to-business terms and compensation. It also includes scoped exemptions for smaller manufacturers. Before estimating a market, an investor needs to establish which installed products, providers and requests fall within the relevant obligations.
Cloud switching creates a separate product obligation
The Data Act also addresses obstacles to switching between data processing services. This matters to enterprise software suppliers that buy cloud infrastructure and to providers whose own services fall within the legislation. Contractual exit rights, exportable data and digital assets, transition assistance and technical interoperability all need attention in product design. Access to connected product data and switching between cloud services are governed by separate provisions, despite their related aims.
A stronger right to leave a service still requires a workable migration plan. Permissions, dependencies, testing and the behaviour of the destination system affect whether an application can move. A young provider can compete by making these costs clear: document the export format, identify the work required to restore service elsewhere and test that process with realistic data. Promising frictionless migration before doing that work would create its own procurement risk.
Adoption provided time to prepare
Adoption opened a preparation period. The Commission later confirmed entry into force on 11 January 2024 and general application from 12 September 2025. The legislation also provided a later start for the connected product design obligation. Manufacturers were not required to expose every interface as soon as Parliament approved the framework.
The interval gave founders a sequence of work: identify the precise data needed, establish the customer’s rights, obtain sample exports and prove an operational result. Investors could assess that evidence before assuming broad adoption. A viable industrial data business needed to turn lawful access into repeatable customer results, allowing for integration costs and contractual limits.
Investment implications
- Access requested by users can support independent services while preserving limits around a manufacturer’s intellectual property.
- A business still needs usable data, a lawful purpose and an operational path into the customer’s workflow.
Sources
- Data Act legislative text, PE-CONS 49/23 (opens in a new tab)
European Parliament and Council of the European Union
- Data Act: Commission welcomes political agreement on rules for a fair and innovative data economy (opens in a new tab)
European Commission
- European Data Act enters into force, putting in place new rules for a fair and innovative data economy (opens in a new tab)
European Commission
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