Advantages and Limitations of Dynamic Data Exchange Protocol


Table Of Contents

Dynamic Data Exchange (DDE) solves the problem of data sharing between software programs running on the same computer. Previously, there was no easy way for computer programs to exchange information, so users had to copy or enter data manually from one program to the other. This manual process was tedious, time-consuming, and error-prone.

However, the Dynamic Data Exchange protocol created a standard for programs to communicate with each other, thus eliminating labor, time wastage, and inaccuracies. For example, with dynamic data exchange, a spreadsheet program can pull data from a database and populate a table with sales figures from the database. Also, data on the spreadsheet updates automatically when there is a change to the database.

At one time, dynamic data exchange was critical for creating automated, high-performing systems. But what are the alternatives to dynamic data exchange? Also, what trends currently impact B2B data exchange, and how do you defend yourself against dynamic data exchange attacks? This article explores the answers to these questions.

What is Data Exchange?

Data exchange is the sharing of data or information between different systems, applications, or programs. This data sharing is possible through several methods, including manual data entry, file transfer, or automated data exchange protocol. Data exchange aims to create functional systems that can collaborate while ensuring data accuracy, privacy, and security.

The following include the type of data exchange protocols available:

  1. Batch data exchange
  2. Real-time data exchange
  3. Near real-time data exchange

Batch data exchange transfers large chunks of data at scheduled intervals. In contrast, real-time data exchange is updated as the changes occur. Near real-time exchange, unlike real-time exchange, may delay the data transfer. Near real-time data exchange is useful when real-time data is not feasible or necessary. For example, delay in inventory status in supply change management is not critical, but timely data delivery is still important.

Although there are several methods for data transfer, it’s important to select a method that’s on par with the system’s specifications, as well as privacy and security considerations.

Data exchange has several applications, namely:

  • Business-to-business (B2B) transactions
  • Data migration
  • Electronic data interchange (EDI)
  • Inter-process communication

How Revelate is Leading the Way in Secure Data Exchange

Revelate as a data exchange platform enables data buyers and sellers to connect and transact. The platform provides a fully self-service marketplace where companies can sell or share their data assets directly to other businesses or individuals.

One of the critical features of Revelate’s data exchange marketplace is its commitment to data security and governance. The platform has partnered with Immuta, a leading data security and privacy platform, to ensure that data assets are protected and comply with regulatory requirements without compromising on data access. Through a centralized security management system, organizations can control their security and governance in one place, even with multi-cloud or hybrid systems. This ensures that security and data governance is consistent throughout the data pipeline and during the extraction, preparation, transformation, and fulfillment process.

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What is the Difference Between Dynamic Data Exchange (DDE) And Data Exchange?

Data exchange and dynamic data exchange support transferring data between software systems and programs. However, there are marked differences between these two methods. The following table highlights these differences:

Feature Dynamic Data Exchange (DDE) Data Exchange
Communication Method Client-server architecture, where a client program sends data requests to a server program File-based architecture where data is saved in a file and then transferred
Speed of Transfer Fast and efficient for real-time data updates May be slow for large data sets or frequent updates
Data Security Can be vulnerable to security risks if poorly implemented Encryption and secure file transfer protocols enhance security
Flexibility Allows real-time data updates between different software programs Can be limited to specific applications or platforms due to compatibility issues
Popular Applications Microsoft Office applications, such as Microsoft Excel, Word, Access FTP, HTTP, SMTP, and similar protocols for transferring files or messages between systems

It’s important to note that dynamic data exchange has significant drawbacks, including limited functionality and security vulnerabilities, when you compare it with newer technologies. Technologies such as web services, messaging systems, and APIs often perform better, offer more functionality, and are more secure.

How is Dynamic Data Exchange Being Exploited?

Attackers have previously executed malicious code on a victim’s computer with dynamic data exchange enabled. Here are a few ways dynamic data exchange has been exploited:

  1. Malicious macros in Microsoft Office documents: Attackers execute macros commands in Microsoft Office documents that then download and execute other malware.
  2. Remote Code Execution: Through dynamic data exchange exploits, hackers can hijack your system’s control and execute harmful code on them remotely.
  3. Social Engineering: Attackers trick users into opening malware-infested documents that are cleverly disguised as legitimate files or documents.
  4. Information stealing: Some dynamic data exchange exploits target sensitive information such as login credentials or personal information. Then the data is sent to a remote server illicitly.

How to Defend Against Dynamic Online Data Exchange Attacks?

Indeed, dynamic exchange protocol is vulnerable to data hijack, loss, or breach. Defending against Dynamic Online Data Exchange (DODE) attacks can be challenging. Still, these measures will reduce the risk:

  • Use anti-virus and anti-malware software: Install and regularly update your anti-virus or anti-malware program to receive protection against attacks.
  • Use a firewall: Implementing a firewall to monitor your traffic and prevent unauthorized access to your network or computer.
  • Disable unused functionality: Disabling unused functionalities in your software will reduce the chances of an attack.
  • Use strong passwords: Strong and unique passwords protect your system against illegal access and brute force attacks.
  • Keep software up-to-date: Update your applications regularly to ensure they receive critical security updates against known threats and exploits.
  • Educate employees: Ensure employees are familiar with healthy security measures they must implement. Also, help them recognize and respond to potential security breaches.
  • Monitor network traffic: Traffic monitoring may reveal anomalies or suspicious activity that could indicate a security compromise.
  • Implement access controls: Access controls restrict access to sensitive system data and may mitigate losses in the event of an attack.
  • Use encryption: Encrypt sensitive data while it’s transmitted or stored.
  • Conduct security testing: Regular security tests and assessments will help identify and address system weaknesses.

Dynamic Data Exchange Integration Service Provided

Dynamic data exchange is outdated, but some legacy software may still be the protocol and require integration with other applications. So you will need data exchange integration services (software tools) that can integrate different applications using the dynamic exchange protocol.

Integration services include tools configuring dynamic data exchange links between applications and monitoring and managing dynamic data exchange data.  Also, integration services may include software development kits (SDKs).

The benefits of integration services for dynamic data exchange include the following:

  1. Improved efficiency: DDE integration services support real-time data transfer and eliminate the need for manual data entry.
  2. Greater accuracy: DDE integration ensures your data is consistent and up-to-date and reduces the risk of error from entering data manually.
  3. Compatibility: DDE is a widely supported, albeit outdated, transfer protocol.
  4. Cost saving: DDE integration reduces the need for manual data entry and thus saves costs. Also, it may be cheaper than switching systems and protocols.
  5. Customization: You can customize DDE integration to meet specific business requirements, therefore meeting your unique data transfer needs.

How to Set Up New Integrations with Data Settings?

  • Identify the data settings: Determine the data settings you want to integrate with DDE. You may need to identify specific data sources and fields as well.
  • Set up the DDE server: Install and configure the DDE server software on the server.
  • Configure the DDE client: Set up the DDE software on the client (computer). Then configure the client to connect to the DDE server.
  • Establish a DDE link: Create an exchange link between server and client applications. To create this link, specify the data exchange topic and application.
  • Configure the data transfer: State the transfer settings, such as the data format and update frequency.
  • Test and troubleshoot: Test the DDE integration so the data transfers correctly and resolve any issues.

Key Benefits of Dynamic Data Exchange

Dynamic data exchange technology has some key benefits, including the following:

  • Real-time data transfer: DDE allows applications to communicate with each other e efficiently.
  • Automation: DDE Automates data transfer between applications, thus reducing the need for manual data input and the risk of error.
  • Compatibility: The protocol is supported by many applications and platforms. As a result, it is a versatile data transfer solution.
  • Reduced development time: Since DDE is widely supported,  integrating applications through the protocol is convenient and saves time. DDE is less complex than developing custom integration solutions.
  • Cost-effective: DDE is a cost-effective solution for data transfer.

Using Dynamic Data Exchange as an Integration Tool

Should you use dynamic data exchange as an integration tool? While DDE has its use, it may not be the best for your particular integration need. Consider these factors when deciding whether to use DDE as an integration tool:

  • Compatibility: Dynamic data exchange has far-reaching support, but it may be incompatible with some applications.
  • Data requirements: Consider your data’s complexity and volume when deciding on a data exchange protocol. DDE is best for small to medium-sized data sets but isn’t optimal for transferring large or complex data sets.
  • Security: DDE transfer protocol has security implications since it is without encryption or authentication features. This inadequacy is a concern if you must transfer sensitive or confidential data.
  • Development time and resources: Integrating applications through dynamic data exchange requires time and resources, so this option may be impractical for urgent projects.
  • Overall business needs: You must consider whether dynamic data exchange serves your business goals and needs. DDE may save you costs but is unideal for your organization’s data project.

Key Trends Impacting B2B Data Exchange


The demand for real-time data drives the need for faster and more efficient data-sharing protocols and systems. For example, companies rely on data and data science to make choices, gain customer insight, and drive innovation. As a result, B2B data exchange platforms must invest in technologies such as APIs and microservices to meet this demand.

Also, data security and privacy are pertinent issues as the volume and speed of data transfer increase. Thus, businesses must implement stronger security methods to comply with data protection regulations. 

A Growing Number of Customers and Suppliers

The increase in customers and data suppliers directly impacts B2B data exchange. This growth has the following impacts:

Increased complexity: More data suppliers and customers will increase the number of exchanged data points, thus requiring a robust B2B data exchange process.

Scalability challenges: B2B data exchange systems must be scalable to handle voluminous data and massive data requests.

Data quality issues: Data quality becomes a concern when transferring large volumes of data. Therefore, modern transfer protocols must ensure data integrity and accuracy.

Security concerns: More parties involved in data exchange mean there is a heightened risk of data breaches, theft, and cyber attacks. Therefore, B2B data exchange must have built-in features to protect sensitive information.

The proliferation of data products and consumers can challenge B2B data exchange. However, the right systems and processes meet and overcome these challenges so that data exchange remains valuable for businesses.

Expectations for Faster Response Times

The expectation for speedier response times significantly impacts B2B data exchange, especially in finance and healthcare industries where real-time data is crucial. This expectation has the following effects:

Increased pressure to deliver data quickly: Heightened demand for quick, real-time data mean companies must invest in systems and processes that can handle increased processing. These systems are often more complex and expensive than traditional batch processing.

Greater importance of quality data: Incorrect data  can have catastrophic consequences. As a result, companies need tools, procedures, and policies to ensure data quality.

Impact on customer experience: Customers give positive feedback when they can access information quickly.

Increased cost: Modern data transfer systems require you to invest in resources like hardware, software, infrastructure, and the people with the skills to manage it all.. Therefore, companies must weigh this cost against its benefits to decide on the best solution.

IT and Cloud Efficiencies

Here are specific ways IT and cloud efficiency influences the future of enterprise data exchange:

Faster data transfer: Cloud systems have faster transfer speeds than traditional systems. This technology has promoted data exchange between companies, reducing delays and improving efficiency.

Increased scalability: Cloud-based systems can be scaled easily to support infinite users simultaneously. This scalability ensures you conserve unused resources while driving down costs.

Improved security: Cloud-based systems have top-level security systems, such as encryption and access controls. This features tremendously reduces the risk of a data breach.

Improved accessibility: You can access data on the cloud from anywhere with an internet connection.

Increasing Transaction Complexity

Every day, companies initiate complex data transfers between each other. The volume of the data coupled with the file format creates complexities that impact enterprise data exchange in the following ways:

Increased data volume: Companies must handle and process voluminous data efficiently.

Need for standardization: Data standardization allows companies to agree on common data formats and protocols to ensure data is consistent and easy to work with.

Heightened risk of errors: Complex data transactions are trickier to handle, so there is an increased risk of errors during data exchange.

Need for data validation: Data validation allows companies to check the accuracy and completeness of the transacted data to ensure it meets the standards.

Need for advanced data processing: For today’s data marketplaces, advanced data processing systems are necessary for processing complex data in large volumes.

Companies must prepare to handle large data transfers and ensure data standardization and validation by investing in sophisticated processing systems. Proactive companies will maintain an effective B2B data exchange process even as complexity surges.

Increasing Costs of a Data Breach

Data breaches negatively affect B2B data exchange since they result in the loss of sensitive data and finance. This estimate pegged the cost of a data breach in 2022 at $4.35 million. Also,  breaches damage the reputation of the companies involved.

Consequently, companies must focus on improving the security of their data exchange processes to avoid or mitigate the effect of any potential security threat.

The increasing costs of data breaches have the following impact on B2B data exchange:

A focus on security: Data breaches are expensive. So companies focus on improving the security of their data exchange processes.

Regulatory compliance: Data breaches lead to fines and other legal consequences. Companies that must avoid disciplinary action focus on satisfying regulatory compliance requirements for data exchanges, such as the General Data Protection Regulation (GDPR) or the Health Insurance Portability and Accountability Act (HIPAA) in the US.

Risk management: Risk management involves conducting regular security audits or implementing a response plan for potential security incidents.

Investment in data protection technologies: Companies now invest in sophisticated data protection technologies, such as firewalls, intrusion detection systems, and endpoint protection, to secure their data exchange processes.

Collaboration among B2B partners: When companies collaborate closely with their B2B partners, they follow best practices for secure data exchange and share information about a potential threat with their partners.

Alternatives to Dynamic Data Exchange

Microsoft developed the dynamic data exchange protocol in the 1980s. However, DDE is becoming outdated and is no longer supported in newer windows versions. But the following are alternatives to DDE:

  • OLE (Object Linking and Embedding): OLE is an improvement of DDE and is supported in some Microsoft Office applications for data sharing functionality.
  • COM (Component Object Model): COM allows different applications to interact with each other using binary interfaces.
  • ODBC (Open Database Connectivity): ODBC allows applications to access data from database management systems.
  • Web services: This technology allows different applications to communicate with each other over the Internet. Web services use standard protocols, such as SOAP, XML, and HTTP.
  • REST APIs (Representational State Transfer): REST APIs are popular in web applications and are compatible with several programming languages and platforms.

What is the Difference Between Dynamic Data Exchange (DDE) and Cloud-based Data Exchange?

There are several differences between dynamic data exchange and cloud-based data exchange platforms. The below table highlights these differences:

Feature Direct Data Exchange Cloud-based Data Exchange
Platform Windows Platform independent (access with any online device)
Connection Direct connection between applications Connection over the internet using cloud services
Data Sharing Only between applications on the same machine Accessible from any online device
Security Less secure, limited access controls More secure with advanced access controls and encryption
Cost Low or no cost, ships with Windows May require subscription fees or pay-per-use charges
Scalability Limited to just the network Highly scalable, can handle large amounts of data and users
Maintenance Requires manual configuration and management Managed by cloud service provider
Availability Requires both applications to be running and accessible Can be accessed anywhere, anytime



At Revelate, we offer custom-made data fulfillment solutions for businesses to manage data, whether you want to automate and optimize your data sharing, earn from data monetization, or build data exchange partnerships.

We simplify complex data-sharing processes in teams, company-wide, or with partners. As a result, people on your team get the data they need, when and how they need it. Also, this data follows its governing usage as your needs dictate.

In addition, we offer scalable enterprise-grade systems to handle your B2B data exchange needs and maximize your revenue. Revelate integrates with data science, BI, and analytic tools so that you can scale your learning model to fit your needs.

You can book a demo or start your free trial today with us.

Unlock Your Data's Potential with Revelate

Revelate provides a suite of capabilities for data sharing and data commercialization for our customers to fully realize the value of their data. Harness the power of your data today!

Get Started