Data portability pays off: a data portability option improves user perception of online services

The results show that customers prefer services that enable data portability and also accept higher costs for them. Service providers can therefore benefit from enabling and actively promoting data portability.

Data portability: legal claim, but hardly any opportunities for use

The General Data Protection Regulation (GDPR) also guarantees users of online services (e.g. email, streaming, cloud or other services) a right to data portability. This right, written in Article 20, obliges service providers to enable their customers to retrieve all data provided by them. It should also be possible to transfer this data to other providers, for example when switching to another service (Kübler-Wachendorff et al., 2021)[1].

In practice, however, it is still difficult for users to make use of their right to data portability: Only a few providers explicitly point out the right and provide tools for data retrieval. If data is made available, it is often in non-standardised formats that are difficult for users to understand, and there are hardly any options for importing this data into other services and making it accessible again (Syrmoudis et al., 2021)[2].

Research question: How does data portability influence user perceptions of online services?

One reason for this hesitant implementation could be that it is still unclear how offering and actively promoting data portability affects customer perceptions of online services: does such an offer make the service more attractive and increase the willingness to use and pay for it? Or does it lead to users feeling less committed to the service and migrating more quickly to other services? Or is data portability even misunderstood and leads to user irritation, as has been reported in isolated cases in previous surveys of internet users (Luzsa et al., 2022)[3]?

We address these questions and investigate how actively promoting data portability – in the sense of simply importing data automatically when switching services – affects perceptions of an online service, that is, how it influences intention to use and willingness to pay for the service.

A total of 395 people aged 18 to 40 took part in an online study. They were presented with ten hypothetical offers for email services, for each of which they indicated how likely they would be to use the service. The offers differed in price (five levels: free; €0.49 per month; €0.99 p.m.; €1.49 p.m. and €1.99 p.m.) and in whether an option was offered for easy, automatic transfer of data (i.e. messages, contacts, appointments, etc.) from a previously used service to this new service (two levels: yes; no).

Results: Users prefer services with the option of data transfer

The results show that a data transfer option significantly increases the willingness to use the service – on average by about ten points on a scale of 0 to 100. Figure 1 shows the reported willingness to use the service with and without a transfer option for different price levels.

The positive effect of data portability is most pronounced for free services, where it increases willingness to use by about 22 points, and it decreases as the price increases. However, at all price levels, the willingness to use services with portability is significantly higher than for services without this option. In addition, a comparison of the price levels shows that an advertised data portability option reduces the price sensitivity of the respondents: for example, the willingness to use a service costing €0.99 that actively offers data portability is higher than that for a service costing €0.49 that does not offer this option – this corresponds to a doubling of the accepted monthly price.

Additional analyses examined whether the effect of a data portability option also depends on socio-demographic and personality factors of the respondents. This showed that especially tech-savvy and tech-savvy people tend to prefer services with advertised data portability, and that they are also more willing to accept higher prices for it.

Summary and recommendations

We will publish the results in a working paper on the bidt website shortly. Overall, the working paper suggests that data portability has benefits not only for users but also for service providers and should be actively designed:

• Providers have advantages if they make the right to data portability, which the GDPR requires to be implemented anyway, user-friendly and offer simple import and export options that facilitate switching from or to other providers.
• These options should be actively promoted as they make customers more willing to use services.
• The positive effect of data portability on willingness to use occurred in the current study for both free and paid services.
• User-friendly import and export options allow providers to price offers (higher), as the share of customers willing to pay is increased by an explicit reference to data portability.

It should be noted that our analysis only focused on email services. How much data portability increases the willingness to use and pay for other types of services (such as cloud or streaming) must be determined specifically in each case, taking into account the competitive situation.

Further results as well as recommendations on how website visitors can be made aware of data portability in a comprehensible way by means of visualisations can be found in the working paper shortly.

The blog posts published by bidt reflect the views of the authors; they do not reflect the position of the institute as a whole.

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