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Need For Data Licensing: 8 Questions To Ask Before Purchasing Customer Data



Any business will need accurate and licensed data. Undoubtedly, it is an accepted fact. Is there a way to get licensed and compiled data? Many businesses will purchase customer data from third parties. In turn, the data provider updates the list based on the agreement. However, all the third party resources do not come under the data license agreement. Here is the first question to ask yourself. "Am I purchasing the mailing list abide by data licensing?"

If your answer is YES, learn about its usage before getting trapped in problems. Businesses who ignored data license agreement of customer data have encountered many problems like -

  • License Breaches
  • Regulatory Compliance Failure
  • Intellectual Property Violation
  • Privacy Law Violation

Do not get trapped! The team at Global B2B Contacts have well researched and presented you these questions. Make sure to ask these questions before buying the mailing list from third parties. As a result, you can deal with the data purchased with better confidence.

Question # 1: How is the data license agreement defined by the third party provider?

The core provisions of the data license agreement should define the following factors:

  • Ways in which they provide and update the data.
  • The frequency at which data is updated.
  • Whether the data provided are on real-time or close to real-time.
  • The format in which mailing list is delivered.
  • The mechanism in which the mailing list is delivered.

The agreement might include the safe delivery mechanism and the right usage of encryption. Additionally, it requires specific software and hardware configuration requirements. These core provisions will vary based on the type of license business owns.

Question # 2: Are you permitted to use the data purchased?

Check whether your business is permitted to make use of the mailing list purchased. Learn all the restrictions imposed on the licensee before using the data. The data usage must not be constrained to the usage by the entity but also the affiliates of that entity. Most importantly, check for the exclusivity of license agreements. Your data license agreement should be exclusive. If the data is non-exclusive, both the licensee and licensor possess equal rights on the data. In turn, he or she can license the data to the other third parties.

Question # 3: What is the exact objective of data license?

Sometimes, the data license is restricted to a specific purpose. The licensee must use the data purchased only for that purpose. Let's assume a person provides his data to the bank for opening a new account. Many times this shared data included in the database possess limited usage. Consider learning about the purposes for which the data is allowed for usage. Explore all the possible uses. If the agreement does not include the generic purpose, you will need to take up compliance processes. It helps you to get rid of license breaches. Never make blind choices when it comes to purchasing customer data.

Question # 4: Does the data license agreement include location restrictions?

Your business might operate in different locations and need to reach customers from multiple places. It is important to learn about where the data can be accessed and used. If you want to use it in the multiple locations, ensure to have it on the data license agreement.

Question # 5: How should privacy and security issues be defined in the license agreement?

Understand the privacy and security information related to the mailing list you intend to purchase. The GDPR regulations, cybersecurity, and other data protection laws are today's prime concern. Take actions on the data purchased only after proper understanding. It must include the information about the sensitivity of the data, nature of the data, measures to be taken by the licensee to protect the data, and the liability of the licensee if data breaching occurs.

Question # 6: What is the quality of customer data you intend to purchase?

There is no hard and fast rule that licensed data should always be of high-quality. Make sure you verify the data quality before completely depending on it. Such information will generally be present in the disclaimer section of the license agreement. The data must not be shared with multiple users. As a whole, read the information under the disclaimer section before making the purchase decision. They also mention that the licensor does not guarantee the accuracy and completeness of the data. In turn, they should not be blamed for the same.

Question # 7: What are the rights you are given after purchasing the customer data?

After purchasing the mailing list from the third party, the licensee is given the set of rights to use. Do not ignore to check for the presence of any restrictions on usage. Many suppliers will not provide the broader rights of usage. Ask for the inclusion of anticipated purposes and rights into the agreement. For instance, you might use the personal data from the mailing list. In turn, your licensor must have consent from the individuals for the use of their personal data. Sometimes, the individuals can withdraw their approval. As a result, the licensor must update the same to you.

Question # 8: What is the duration in which you can use the data purchased?

The subscription period of data license depends on the licensor. Most of the time, the data license is said to have short term. At the end of the subscription term, the data will either get destroyed or returned. The customer data plays a significant role in your business. It is extremely important to know about the validity of the data purchased. It is always possible to track the ways in which data was used. Learn about the limitations and be safe. In addition, check whether the terms mentioned is sufficient for your business. Get it modified as per your business requirements.

From this blog post, you are aware of the questions to be asked before purchasing the customer data. Spend considerable time answering these questions. It is extremely important to prevent any license breaches.