"Data is the new oil" is such a concise phrase to provide context regarding the recent controversies of big tech.
If anything, I'd say data is more valuable than oil. For one it's "renewable", but also the insight that can be gathered from data gives it a level of reach that even surpasses oil (which is very versatile in its own right).
Data breeches are the new oil spills, the destabilizing by-product of burning fossil fuels has a lot of similarity to how the largest data brokers can disrupt entire industries, political systems, and neighborhoods.
Data is a target for geo-political actors, whether it be slipping spyware into network infrastructure or tracking your own citizens.
When we look back 100 years from now, I won't be surprised if the events that occurred during the mass commercialization of oil (anti-trust, regulation, military action, productivity gains, facilitation of developing economies) also occur due to data.
Technically, this is off-topic, but Daniel Yergin's book 'The Prize' is an excellent, page-turning, read on the commercialization of oil. If your hunch is right, maybe you could get a preview of the next 100 years by reading it. I might go re-read it.
Thanks for the recommendation, I've been looking for books like this to better understand today and what our future might look like. I'm currently wrapping up The Robber Barons by Matthew Josephson and it's a really solid read.
It's a little early to claim that data is more renewable than oil. Oil has been extracted vigorously for 150 years, with only moderate increases in difficulty. How can we predict the economics of extracting data 150 years from now?
They may have meant renewable in the sense that it is produced without requiring the consumption of a finite resource. Oil extraction is much faster then the rate at which it was generated, over millions of years.
I'd say "engagement is the new oil". As long as users keep scrolling, clicking & viewing the money keeps flowing :-/
Data without engagement is less valuable, unless you want to monetize it in less-ethical ways. For the time being, big tech companies aren't stooping to the level of outright selling user data, despite what critics claim.
And just like the production & consumption of oil, capitalizing on maximum user engagement produces some severe negative externalities—particularly in politics.
Perhaps engagement is paramount to the Facebooks of this world but data gathering is valuable to a much larger set of companies and nation states. Think health and location data - very useful to many industries that can better target their products and services to you outside of just clicking and scrolling through websites/apps for advertising dollars. I also would not discount companies using data in unethical or even illegal ways. There isn’t enough regulation and oversight yet.
Data is not renewable. When humans die the economy will die with them. Humans will die soon if we do not change how we produce energy. Why invest in data at all when the world as we know it is likely to not exist in 100 years?
Tech companies are simply the people routing mammoths off a cliff to keep the party going, consciously ignoring the idea that the food will run out soon.
Data is not more valuable than oil, unless you intend to start running a blackmail operation.
Most of the data collected by silicon valley companies is completely irrelevant to their or anyone else's business needs. It's just creepy. Kind of like the people who build such systems.
What you are calling blackmail here has been deemed legit for government agencies to do. Also countless instances of private companies misusing data have established a sense of acceptance in minds of people who no longer have will/energy left to fight it.
None of the social network companies sell user data. They sell ad placement, and use user data to target the ad audience. Selling ads is not selling data. When I think of selling data I think of companies that actually sell data. Equifax or MaxMind, for example.
Oil and gas drilling alone are 2-3% of world GDP, which comes to about $2 trillion dollars. Facebook and Google make about $100 billion in combined ad revenue. I think it’s safe to say oil is probably 10x more valuable than social network advertising.
> Data breeches are the new oil spills
Comparing credit card fraud with ecological pollution and death?
You're taking a much narrower view than what I was going for in my comment. I never mentioned companies selling data and I never mentioned ad revenue either.
Data on its own is not that valuable, but it's a crucial commodity that when monetized generates value that I'd say are more valuable than oil. Companies are using data to optimize supply chains, reducing spending, generating value. Others are using data to recommend you products that you're more likely to buy, increasing profit, generating value. High quality data is the ultimate commodity, the insights derived from it can lead to much more value than oil, that's the main point of my comment.
I don't think they meant that LITERALLY data is as important as oil. Obviously ALL economic activity is predicated on energy. (Oil or otherwise.)
But data is still extremely important. I think it might be more analogous to say that data has become as important as finance. Without finance a lot of things grind to a halt. Without data, I'd argue, a lot of things would grind to a halt. (Maybe even more things would grind to a halt than if finance disappeared?)
But yes, without oil, (or, even better, without energy in general), everything grinds to a halt. It all stops.
> Comparing credit card fraud with ecological pollution and death?
It's an analogy, precisely because the general populace still doesn't understand how drastic the impact a data breach is, but they sure do understand what a duck looks like full of tar. Depending on what type of data breach it is (credit card, social, healthcare, etc) then yes the implications can be potentially dire.
Extreme, but plausible examples of "yes this means death and polluted environments too":
- Ransomware in a healthcare IT system that doesn't allow doctors to view patients data if they don't pay the crypto ransom
- Credit availability to someone paying for healthcare or some other life altering purchase but can't because their identity was stolen or credit score was impacted. Not to mention the emotional distress caused by bankruptcy (undue).
- Civil unrest resulting from data breaches used for manipulation/propaganda targeting reasons (see -> Brexit and 2016 presidential election)
They are certainly monetizing data, even if they are not commodifying it. In addition there are many other streams of data being accumulated and monetized besides Facebook and Google (e.g. your supermarket value card and its ilk).
They monetize by selling ad placement. Advertisers get to choose who sees the ad based on segmenting the audience with user data. In no way does Facebook or Google package private data and sell it. Which is exactly what “sells user data” is meant to imply.
> None of the social network companies sell user data.
Twitter does [0] and it's worth noting that fb has considered it [1]. I think it's fair to say this may be more and more attractive as the industry matures and new avenues for marketing data emerge.
"Available on the public web" does not mean "freely accessible", otherwise you'd be able to scrape - or simply download - without getting blocked for ToS/AUP violations.
If anything, I'd say data is more valuable than oil. For one it's "renewable", but also the insight that can be gathered from data gives it a level of reach that even surpasses oil (which is very versatile in its own right).
Data breeches are the new oil spills, the destabilizing by-product of burning fossil fuels has a lot of similarity to how the largest data brokers can disrupt entire industries, political systems, and neighborhoods.
Data is a target for geo-political actors, whether it be slipping spyware into network infrastructure or tracking your own citizens.
When we look back 100 years from now, I won't be surprised if the events that occurred during the mass commercialization of oil (anti-trust, regulation, military action, productivity gains, facilitation of developing economies) also occur due to data.