This week, I read and shared a notable Wall Street Journal article on the value of government data in that bears highlighting: hedge funds are paying for market intelligence using open government laws as an acquisition vehicle.

Here’s a key excerpt from the story: “Finance professionals have been pulling every lever they can these days to extract information from the government. Many have discovered that the biggest lever of all is the one available to everyone—the Freedom of Information Act—conceived by advocates of open government to shine light on how officials make decisions. FOIA is part of an array of techniques sophisticated investors are using to try to obtain potentially market-moving information about products, legislation, regulation and government economic statistics.”

What’s left unclear by the reporting here is if there’s 1) strong interest in data and 2) deep pocketed hedge funds or well-financed startups are paying for it, why aren’t agencies releasing it proactively?

Notably, the relevant law provides for this, as the WSJ reported:

“The only way investors can get most reports is to send an open-records request to the FDA. Under a 1996 law, when the agency gets frequent requests for the same records—generally more than three—it has to make them public on its website. But there isn’t any specific deadline for doing so, says Christopher Kelly, an FDA spokesman. That means first requesters can get records days or even months before they are posted online.”

Tracking inbound FOIA requests from industry and responding to this market indicator as a means of valuing  “high value data” is a strategy that has been glaringly obvious for years. Unfortunately, it’s an area in which the Obama administration’s open data policies look to have failed over the last 4 years, at least as viewed through the prism of this article.

If data sets that are requested multiple times are not being proactively posted on Data.gov and tracked there, there’s a disconnect between what the market for government data is and the perception by officials. As the Obama administration and agencies prepare to roll out enterprise data inventories later fall as part of the open data policies, here’s hoping agency CIOs are also taking steps to track who’s paying for data and which data sets are requested.

If one of the express goals of the federal governments is to find an economic return on investment on data releases, agencies should focus on open data with business value. It’s just common sense.

[Image Credit: Open Knowledge Foundation, Follow the Money]