With the tech revolution spreading across all sectors around the world, data has become an increasingly valuable commodity and has the power to shape our lives – prompting moves to bring the co-op model to bear, to bring it under democratic control.
With social media companies gathering a wealth of personal data; gig economy platforms using data to extract wealth; datasets from farms, transport and health organisations like the UK’s National Health Service acquiring greater monetary value, and businesses in sectors like retail, leisure and finance continuing to harvest information on customers, issues of control, accountability and transparency become more urgent by the minute.
Now, a report from Project Liberty, Data co-ops as a scalable alternative to the centralised digital economy, is the latest attempt to make the case for the mutual model.
Written by Jeb Bell and Sarah Nicole of Project Liberty, and Connor Spelliscy and Samuel Vance-Law of the Decentralization Research Centre, the report has insights from co-op experts including Doug O’Brien, CEO of US co-op apex NCBA Clusa, Nathan Schneider, director of the Media Economies Design Lab, and Jessica Gamache, head of research at the Filene Research Institute.
The report argues that the co-op model can help to empower people in a world dominated by tech giants, because it fits with notions of collective consent.
“Co-operatives are inherently designed around group interests and shared outcomes,” it says, “which makes them structurally well-suited to managing data whose value and ethical implications often extend beyond individuals.
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“Unlike corporations that treat data as proprietary and individual privacy as a liability, co-ops can treat collective data rights as a core mandate, much more consistent with how data actually functions.
“Importantly, co-operatives offer a form of collective leverage that is largely absent in today’s data economy. Individuals have little bargaining power when faced with the opaque and asymmetrical practices of tech giants, exemplified by practices in the gig economy that blur the boundaries between contractors, freelancers, and employees, often leveraging this vagueness to minimize obligations and shift risk onto workers.”
Instead, co-ops enable communities to pool resources, negotiate collectively, and shape the terms of engagement, the report says – which is “especially important for marginalised groups.
It gives the example of Enyorata Loviluku in Tanzania, where women, historically excluded from access to bank loans, have created a co-op that can receive credit, leveraging collective financial data and risk.
Co-ops can work on this by scaling out, rather than up, the report adds. “Co-ops grow through networks, not monopolies. This allows for decentralised, context-driven, and democratic governance that reflects the nature of data itself.”
Models such as large co-op federations, or networks like the US family of rural electric co-ops, show the potential for scaling out data in this manner, the report says.
This sort of co-operation can produce the sort of quality data needed if we are to have better AI, the report adds. “The shared ownership provided by the co-op model ensures those who generate it share its benefits. Co-ops incentivise quality, trustworthy data, making them uniquely aligned with both ethical AI development and fairer outcomes for contributors.”
Examples of co-operation in data cited in the report include the Credit Union Data Exchange (CUDX), a co-op that allows credit unions to contribute their data, which is then anonymised, pooled, and securely shared among participating institutions.
“This collaborative model empowers credit unions to access broader insights, benchmark performance, and provide data-driven decision-making while maintaining control over their individual datasets,” the report adds.
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Meanwhile, the emerging Ag Data Cooperative enables farmers to own and manage their agricultural data, using it to make better decisions while maintaining privacy.
“By aggregating data across members, the co-op allows farmers to benchmark performance, identify trends, and access more competitive services,” the report says. “Unlike traditional tech platforms, the co-operative is governed by the farmers themselves, ensuring transparency and data sovereignty, using it to make better decisions while maintaining privacy.”
But co-ops will need support from policymakers to succeed in democratising data, the report warns. It says markets should be actively shaped, not just regulated. “Policy has supported co-operatives, making them a legacy model,” the report argues. “It should do the same with data co-operatives. Governments must move beyond ex-post and punitive regulation only and act as proactive market shapers to support co-operative infrastructure.”
The report also considers issues like governance and ownership, noting a recent “growing experimentation with hybrid structures that involve co-operatives without being exclusively co-operative in form.”
This can mean alliances with venture-backed tech companies, to gain access to capital, or with nonprofits to take advantage of their tax status or fundraising ability – although the report warns there can be incompatibilities between partners and risks in venture capital partnerships which can turn a co-op into “a dependent shell”.
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But the authors think that “hybrid forms, when carefully designed, can offer co-operatives a place within broader organisational ecosystems, without losing sight of their core principles.”
This report concludes that the current data-driven economy, dominated by a few large technology companies, is structurally limited in how it recognises and understands the value of data.
“By narrowing data’s role to that of an extractable, monetisable asset, focused on the individual rather than the collective, these companies fail to acknowledge alternative forms of value and foreclose opportunities for more democratic and participatory governance,” it says.
“Co-operative models, both traditional and data-oriented, demonstrate the feasibility and suitability of a pluralistic approach, where data can serve multiple functions and is accountable to the communities that create it.”
Co-ops are successfully innovating to fit and transform the data economy, the report adds, but “for these efforts to grow and scale, policy needs to recognise and support the co-operative model as viable, efficient, and widely applicable.
“Rather than focusing only on restraining harmful practices, a proactive approach would invest in building up proven, community-rooted structures like co-operatives that can offer a genuine alternative. This means not just correcting market failures, but enabling better models to succeed.”
