Why data isn't the new oil
Jason Foster, CEO and founder of data and analytics strategy consultancy Cynozure, explains that we need a new analogy for data, without some of the negative connotations of oil
Data isn't the new oil, contrary to what many technology experts and commentators have been saying for years, according to Jason Foster, CEO and founder of data and analytics strategy consultancy Cynozure.
Foster explained that whilst the analogy works to an extent, its negative connotations are unhelpful when considering the potential good that data can do.
"Whilst oil has given humans huge opportunity, it has also had a devastating effect on the environment. Oil spills pollute the sea. It's used to make plastics which are damaging the earth. Whereas data has the ability to reverse climate change."
He added that money made from oil tends to enrich individuals, again unlike data.
"Making money from oil is limited to a very few people and countries. Data is open, broad and available to everyone."
He continued: "Oil is a finite resource. We're running out and looking for more sustainable, renewable sources of power. Data is unlimited and growing. There is more data every day. In fact there has been more data produced this month than in the last 100 months.
"Data can be copied, shared and multiple people can get value from the same piece of data. It can be moved around the world in real time. There are violent wars in oil rich countries vying for access and control of that oil. This doesn't happen with data."
He did acknowledge however that cyber crime is war of a sort, whose purpose is often to attempt to obtain access to sensitive data.
There are also differences in the way that data is created, and its use cases.
"Data can be created today, by anyone, you turn on a watch and start tracking, or build an algorithm that creates new answers. There is no global price for a piece of data. It's not commoditised to the same degree as oil. You can't buy data by the barrel."
Foster added that there are also large differences in the way that data and oil and regulated, especially in the fines imposed for their misuse.
"The fines for misuse stack way more heavily towards oil. The largest was $18.7 billion given to BP for its oil spill in the Gulf of Mexico in 2010. Whereas the total data breach fines are $1.2 billion ever. The largest single fine for a data breach so far was around $600 million for Equifax in 2017.
However, Foster did admit that there are numerous similarities between data and oil, so the analogy does work to an extent.
"Oil is nothing until it's been extracted, refined and put to good use, just like data, so I do understand the analogy."
Looking to the future, Foster worries that data could become more like oil in its negative connotations, so what should we do to protect against that?
"We need to put policies in place to make sure data is put to good and not negative, polluting use cases. Perhaps blockchain plays a part here in making everything more transparent, open and removing the data brokers. We could also tax the use of or benefit from data in different ways, to ensure it has broader benefits to society."