Respecting data sovereignty  

News Team September 25, 2024

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Respecting data sovereignty  

According to Nick McDonald (pictured above), Global Account Director at Fujitsu, data sovereignty has become a major concern for international online gambling operators but it ultimately presents opportunities for growth, so long as companies take the right approach. He shared his insight with SiGMA News.

A powerful tool

Data is often considered the new oil and it’s easy to see why. Data fuels the engine that drives operators and suppliers forward, allowing them to unlock efficiencies, scale at pace and ultimately deliver the deeply personalised experience players have come to expect.

It is essential for organisations to gain a comprehensive, 360-degree view of their customers and their overall operations, enabling them to make real-time, mission-critical business decisions. This is why data is an incredibly powerful tool.

Data sovereignty

But with great power comes great responsibility. Data collection, storage and transfer are now subject to increasingly stringent laws and requirements which makes it difficult for organisations, especially those active in multiple jurisdictions, to centralise data and unlock its full potential.

Data sovereignty – the idea that data is subject to the laws and regulations of the country where it originates or is collected – is now a major focus for all organisations but especially tier-one gambling conglomerates with a truly international footprint.

Proliferation of requirements

The challenge for online gambling organisations is that they generate, collect, store, transfer and use vast volumes of data in multiple markets across the world with each of these markets having specific laws and requirements that must be met.

An additional headache for operators to contend with is the sheer number of sources from which they generate and collect data, with each source and data type often having its own requirements around privacy, storage and security.

This includes everything from debit card details to personal information and even identity documents used to undertake KYC. Throw in things like marketing data, player behaviour data and bonusing data and it’s easy to see why data sovereignty becomes a bit of a minefield.

Operators must also comply with the law at home – also known as data residency – which combined with data sovereignty requirements means having vast, complex infrastructure in place with forensically mapped out processes and clear protocols to be followed.  

Data strategy

This is why a deep understanding of data sovereignty and residency is so important. The right data strategy is crucial for extracting maximum business value from the data generated and stored, while ensuring compliance with regulations and requirements across multiple jurisdictions.

This means considering areas such as data growth and security as well as privacy, compliance, integration, consolidation, cleansing, access and analysis. Privacy and security are perhaps the most important areas, as consumers are becoming increasingly protective of their data and information.

Cyber-attacks and data breaches

This aligns with a sharp rise in cyber-attacks and data breaches. Consumer understanding of data and how organisations gather, store and use their information is improving all of the time, as is their understanding of just how vulnerable their information is to an attack.

Organisations must provide consumers with the confidence they need to share their data with them or risk them not engaging with their brands, products and services.

In some markets, companies are mandated to do this under official data laws, but organisations must go beyond these minimum requirements if they are to foster trust with consumers and reassure them that their data is being used responsibly with a ring of steel placed around it.

Competitive advantage

But if an organisation can get data sovereignty and residency right, it can provide the business with a huge competitive advantage.

By getting on top of data sovereignty, organisations can ensure full compliance with data transfer and localisation requirements in all the markets they operate in, allowing them to leverage this for data-driven decision-making.

Data-driven decision-making is applicable to all areas of a business, from identifying the right payment methods to add to the cashier, to determining bonus campaigns, the odds offered via the sportsbook and the game providers that players want to see in the casino lobby.

Adaptability

But that’s not all – with the right data infrastructure and approach to data sovereignty and residency, online gambling businesses can essentially have a blueprint for entering new markets and ensuring compliance with local data laws.

While rules differ from market to market, the core infrastructure can be quickly and easily deployed. In an industry where new markets are constantly opening, and where first-mover advantage can be significant, this provides a critical edge over competitors.

It also enables organisations to adapt to changes in data laws within any of the markets they target. This is especially important, as data regulations are likely to tighten over time.

Consumers are increasingly concerned about their data, and lawmakers are aware of these concerns. As a result, they regularly review data laws to ensure they remain effective, with updates to requirements being a frequent outcome.

Of course, by having a robust data infrastructure that is flexible and adaptable, online gambling companies can meet any changes that come into force.

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