“Data is the new Oil”
Clive Humby said it first, and since then countless influential people, including CEOs of Fortune 500 companies have followed.
The 20th century belonged to the Oil. Those who owned it ruled the world. Nations and people went to great lengths, including wars, just to own a fraction of it. The immense power and wealth it brought along in a short span of few decades are unmatched in the history of civilisation.
A mere glance at the below picture of Dubai only a few decades apart is a testimony to it.
But oil is a dwindling resource, scarcer by every passing day. There isn’t enough left of it, to propel humanity too far in the future.
Thankfully, humanity doesn’t really need to search for the next BIG thing. Instead, it’s right here, everywhere around us, deeply ingrained in our daily lives. In perceived and unperceived ways, we constantly deal with it knowingly and unknowingly, whether we want it or not.
Data is omnipresent.
But is data really the new oil? And if so, who is owning it?
In my experience, an analogy is never ideal, never 100%.While data is like oil in many ways, it differs in few others (thankfully).
1. Huge potential, but only if refined
Just like oil, data in its raw form is quite worthless. It needs to be processed into valuable information and tangible intelligence. Handled the right way, it can offer an insight into the future, propel AI (Artificial Intelligence), turn mere opinions and judgements into informed business decisions.
2. Drilling it out
A massive amount of stored data is as useless as a huge cache of oil underneath your feet unless you invest in drilling into it. This drilling can be an expensive proposition, and before you get it rolling, one needs to learn with reasonable surety that the investment will pay itself over and beyond in the long run.
3. It’s not what we wish
No one really wants oil or data. Humans were never fascinated by the smell or look or the possession of oil. It’s what it can drive that makes it so irreplaceable. The oil doesn’t drive us to work, to exotic locations. Oil is just the ingredient, what we really want is our BMWs.
What really matters are the innovations that can use data to fuel our human desires.
The possibilities seem endless.
1. It’s not getting over
Unlike oil, data is not a limited resource that is getting exhausted. Instead as a resource, it’s getting generated at an exponentially higher rate with every passing day.
No, we will never run out of data.
2. Data is created, oil exists
Unlike oil, data doesn’t exist on its own. Data isn’t simply lying underground, waiting to be discovered. Instead, it only gets created in response to some action.
Data has a self-life, beyond which even if stored and processed, it might be of little or no value. It needs to be stored as its gets created, and should be acted upon within a reasonable window of time. Oil isn’t going anywhere unless you are burning it to smoke.
4. Not looking for an alternative.
The world is at great pains to replace oil as an energy source. And there are indeed alternatives that we can think of. Not at all the same for Data, to most it’s indispensable.
Who is owning this data?
Well, a majority of it’s in open space, mostly wasted because it never got stored.
But organisations like Google, Apple, Facebook, Yahoo, Amazon, Microsoft (Bing) are the first among equals.
Their business model heavily depends on storing and processing the vast amount of data in a reasonably short amount of time.
They probably know more about you than yourself ever did.
That’s scary and exciting at the same time.
These organisations do at times part with some of their proprietary source code, but seldom with their core data.
Data is oil to them, and they are the new Sheikhs!