Data is the new oil
“Data is the new oil. It’s valuable, but if unrefined it cannot really be used. It has to be changed into gas, plastic, chemicals, etc. to create a valuable entity that drives profitable activity; so data must be broken down, analyzed for it to have value.” –Clive Humby, 2006
The phrase ‘data is the new oil’ was originally coined by Clive Humby, a British mathematician and data science entrepreneur. And then several others repeated the phrase. The phrase became famous and got a lot of attention after it was mentioned by the vice-president of Gartner, Peter Sondergaard- “Information is the oil of the 21st century, and analytics is the combustion engine.” There were times when oil was the world’s most valuable resource. During the 18th century, the oil companies ruled the markets globally. But, with time, the world kept on developing and progressing.
By the late 20th century, humans invented artificial intelligence. All these digital developments led to an increase in prominence of data. In the 21st century, data became the most valuable asset, taking the spot of oil. Industry experts started using the term ‘data economy’ to describe the importance and influence of data in today’s society. As oil is important to the industrial economy, data is important to the digital economy. And the expansion of the digital economy has made data the most valuable resource of the century. Using data as the foundation, scientists invented many robotics and machinery. Scientists even developed humanoids. The most famous example of a humanoid is Sophia. Sophia is a realistic humanoid robot. It is capable of displaying human-like expressions and interacting with people. It’s designed for research, education, and entertainment and helps promote public discussion about AI ethics and the future of robotics.
This is not all; the invention of Google’s go-playing robot has been a topic of discussion at large scale. AlphaGo is a computer that plays the board game Go. Go is considered as a game much more complicated than other games such as chess which makes it difficult for computers to win. But AlphaGo defeated many professional players. The only human player to beat AlphaGo is South Korean professional Go player Lee Sedol. A lot of other robotics and machines like Loomo, Samsung Bot Care, Kuri, LG Rolling Bot, etc. are gaining prominence. All these robotics and machines are products of data.
Data has become the most valuable business asset for companies across the globe. Top companies like Apple, Amazon, Facebook, Microsoft and Alphabet (Google’s parent company) are all data-driven. They have made proper use of data and have become leading companies in the international market. The huge amount of data controlled by these mega companies is bigger than most of the companies themselves. Therefore, industry experts put emphasis on how data infrastructure should become a profit center. And lots of companies follow ‘good data beats opinion’ philosophy. People are realizing that having knowledge about profits, losses or total revenue is not enough to make business decisions. We must have real time access to important data of our business. If we have proper data related to customers, we can make proper decisions about expansion of business or introducing any new goods or services. All this shows that the dependency of business on data is increasing day-by-day, making data the most valuable business asset. Jack Welch once said that there are two competitive advantages of the digital economy: the ability to learn more about our customers faster than the competitors and the ability to turn that learning into action faster than the competitor.
Not only business, the government has also increased dependency on data. Government is moving forward towards creating a data-driven society. The value of data and analytics was as high as 155B USD in 2017. The international Data Corporation expected worldwide revenues for big data and business analytics to grow at a compound annual growth rate of around 11.7% .
Data is of various types. One of the most well known data now-a-days is big data. Big data is a collection of data that is huge in volume, yet growing exponentially with time. It is data with so large size and complexity that none of traditional data management can store it or process it efficiently. Big data is also data but with huge size. World’s first example of big data is Clubcard (world’s first supermarket loyalty scheme) which was invented by none other than Clive Humby, the man who tossed the phrase ‘data is the new oil’.
As we know, oil is useful only after proper refining, same goes to data. Data is also useful in a refined form. The five Vs that make big data a huge business are: volume, velocity, variety, veracity and value. The three A’s of data refinement are: analytics, algorithms and applications. In the refining process to make data valuable, data in the form of analytics is intelligently built into sequences of instructions to serve a purpose as algorithms and then these sequences of instructions are built into a consistent programme that can run multiple platforms as applications.
All this shows that Data is not just new oil; it’s much more than that. Data is constantly being created and growing exponentially, unlike oil which is a finite resource. Oil can be used once only as it gets destroyed after use but data can and should be used again. In conclusion, even though data is new oil from the perspective of importance and influence; data and oil still have different nature and can’t be compared at every point. The going trends show that the prominence of data will increase further. The global focus will be more focused on data than oil. Artificial intelligence is expected to develop at a huge level and can become a very basic part of our daily life.
By Ritu Janegar
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