Data is the new Oil – these days you keep hearing this new paradigm
Not only that. ‘Data is the new natural resource,’ ‘Data is Wealth,’ ‘Data is Money’, and so on.
How does Data work as Oil? Of course, beyond its implied meaning that it is a source of wealth for the people who amass and process it.
Oil is buried deep under the Earth and Ocean in abundance that can be mined, processed, distributed so that users can consume it.
Data is to be mined from millions of users who generate it on a daily basis as part of their daily routine – work life and personal life.
Top five giants of the tech world – Apple, Amazon, Facebook, Google, and Microsoft – know more about our daily interaction with gadgets than we ever will; they are collecting vast amounts of data from tens of millions of users every single day
Data is getting generated as you speak, as you write, as you shop, as you socialize (online and offline) and as you work. It can be in the form of text, image, audio, video or even coded languages.
It may be structured in specified format or unstructured without following any rules.
How do you mine it, as in the case of oil mining? In the case of oil mining, an oil rig needs to be placed and a well needs to be dug up by drilling a long hole into the earth, a steel pipe inserted into the dug hole, and with the help of collection of valves called “Christmas Tree” fitted on the top, oil is extracted.
A different mechanism work in the case of Data. One needs to create a business or use an existing business with a huge spread out ‘net,’ very similar to the one used for fishing.
The ‘net’ can be different depending on the size of the business you have – a ‘cast net’ for a small business or a startup, a ‘drag net’ if you are a medium business and a ‘bottom trawler’ if you are running a large business.
- Like in fishing, the ultimate purpose of all types of nets is to fish as much Data as possible.
- Depending on the size of your business you would be able to deploy the most suitable and affordable net which can catch and fetch Data to the shore.
- Therefore, unlike oil mining, data mining happens more like fishing. Comparison of Data with fishing ends there.
Intel CEO Brian Krzanich predicts that in the future, Big Data is going to change every industry and everyday life for everyone. “Oil changed the world in the 1900s. It drove cars, it drove the whole chemical industry,” Krzanich explains. “Data, I look at it as the new Oil. It’s going to change most industries across the board.”
Once Data is collected by hook or crook, it needs to be processed. Very similar to processing crude oil in a refinery.
For, first it needs to be transported to processors like crude oil being transported through dedicated pipelines or through containers to a refinery.
Data is transported through high bandwidth communication pipelines or through storage devices to the processor.
Similar to ensuring security to the transportation pipelines or for the containers used in oil transport, communication pipelines used for transporting Data need high level of security. This is secured through high standards of encryption technology.
Once Data reached a processor, the processor processes it based on the requirements of the controller (the entity that sends the data for processing) – just as converting Crude Oil into Gasoline, Petrol, Diesel, ATF, LPG, Kerosene and so on in a refinery.
Similar to using a set of chemicals for the refining process, the Data processing uses a set of algorithmic tools ranging from simple software to AI and Machine Learning solutions.
The processed oil is taken to outlets via various channels, through an elaborate distribution setup.
Ditto for Data. Once analyzed, processed Data also takes the same route by going through an elaborate distribution system to reach the customers.
Like oil retail, marketing plays a key role in creating demand and reaching the final product out to prospective customers.
Oil is a single-use commodity, while Data can be reused and shared for new purposes and insights
Move to the dangerous part – Oil Spills. Oil Spill is catastrophic, and it does happen often. Especially while transporting oil from Ocean recovery platforms to refineries.
Data breaches are equally catastrophic to the ecosystem. It can have serious consequences on the lives of the people whose data is breached and can put to peril the businesses from where the data is breached.
Now to Sociology
In both the cases, as with any natural resource, the raw material is deemed to be owned by natural inhabitants from where the resource is explored.
Despite this being the case and that the local inhabitants have a right on the resource, the finished product is sold to users for a huge premium at the end of the chain.
As with any other socio-economic exploitation issue, there has always been conflicts between the genuine owners of oil (indigenous people and land owners of the locality) and corporations who come with enormous resources to explore, extract and export oil for profit.
The same is unfolding in the space of Data where the genuine owners of Data will be stripped off their assets by corporations using their muscles.
They, then, take Data to processing labs to analyse and sell it back in the market including to the same set of people for huge margins.
Marketing will play a crucial role to create the demand, and governments will look the other way around because they can tax the buyers at unimaginable levels.
At the end, it is like the definition of the smartest salesman – ‘striping you off your underwear, and selling it back to you for a fortune’.
Both Oil and Data.
Disclaimer: Views expressed in the article are personal views and not in any manner to be construed as its author’s employer’s or Indian IT Industry’s views