Mining Big Data
A NEW commodity spawns a lucrative, fast-growing industry. A century ago, the precious commodity was oil…. now it is DATA – the oil of the digital era.
FAGAM, (Facebook,Apple, Goole, Amazon and Microsoft) are the five most valuable listed firms in the world, collectively making $25bn in net profit in the first quarter of 2017.
Amazon captures half of all dollars spent online in America. Google and Facebook accounted for almost all the revenue growth in digital advertising in America last year.
The giants’ success has benefited consumers. Google’s search engine, Amazon’s one-day delivery and Facebook’s newsfeed – all free (users pay by hanging over data )
Smartphones and the internet, information gleaned from self driving cars and face recognition have made data abundant and ubiquitous. Being able to mine this Data will make this commodity far more valuable.
Whether you are going for a run (with your fit bit) , watching TV (what you watch is analysed by google) surfing the internet ( data being more motored by Apple and Google) , walking in the road or even just sitting in traffic ( activity being caught by self driving cars or street cameras), virtually every activity creates a digital trace—more raw material for the data distilleries.
And then there is Equifax , sitting with most of America’s key data, including social security numbers , mortgage details and financial position (which has just been hacked). To say nothing of information collected from various Census data .
It is the data scientists, using artificial-intelligence (AI) and machine learning that will extract relevant information from this data , using algorithms that can predict patterns that will make this data turn to Gold.
Who are these people? Where can they be found?
These algorithms will tell you when a customer is ready to buy, a jet-engine needs servicing or a person is at risk of a disease.
Industrial giants such as GE and Siemens are looking to reinvent themselves as data firms so that hey can compete with the likes of startups such as Data Robotics and Box Inc and Tech giants such as CISCO and FAGAM .
This abundance of data changes the nature of competition. By collecting more data, a firm has more scope to improve its products, which attracts more users, generating even more data, and so on. Tesla, which sold only 25,000 cars in the first quarter, is now worth more than GM, which sold 2.3m.
FAGAM’s surveillance systems span the entire economy: With there “God’s eye view” of the economy , they can see when a new product or service gains traction, allowing them to copy it or simply buy the upstart before it becomes too great a threat. Facebook’s $22bn purchase in 2014 of WhatsApp, a messaging app with fewer than 60 employees is a case in point .
And then there is China – with Wechat’s Tencent – who has just taken a big chunk of Snapchat , and with other Chinese companies focussing on self driving cars, China’ answer to Jeff Bezos’s Amazon – Jack Ma’s Alibaba and Telecommunications such as Hauwei, ZTE and Chinamobile