What is a Data Contract: 6 Key Components You Need to Understand

A data contract functions as a formal agreement between data producers and consumers, akin to business contracts in supply chains, ensuring data quality, functionality, and accountability. Over the past year, data contracts have gained widespread acceptance and adoption, despite initial controversy, and are being integrated into products like Starburst and dbt, with notable contributions from figures like Andrew Jones and Chad Sanderson. Critical components of data contracts include clear ownership of data stages, schema definitions, semantics for understanding data meaning, delivery and access SLAs, data quality SLAs, and policy guidelines for data use, retention, and anonymization. These contracts help overcome the challenges of assigning responsibility within data teams and maintaining consistent data standards. As the concept evolves, there is a push toward developing open standards for data contracts, with initiatives like Datacontract.com and the Open Data Contract Standard underway, which Snowplow plans to support.