Let's stop saying that Data are the new oil
In contemporary discussions surrounding technology and innovation, one of the most recurrent phrases is the assertion that "Data is the new oil." Like oil, data holds immense value, often referred to as the "black gold" of the digital era. Just as oil fueled the industrial revolution, data drives the digital revolution, powering advancements in artificial intelligence, machine learning and predictive analytics. While this analogy has gained widespread acceptance, it has also become somewhat clichéd, potentially leading to misconceptions regarding the true value and nature of data.
Comparing data to oil implies a parallel in their utility and scarcity. Oil, as we know, is an abundant yet finite resource, necessitating refinement to unlock its energy potential. Once processed, in forms such as gasoline, it readily fuels various aspects of modern life, enabling individuals to power their vehicles with ease.
Similarly, some may perceive data in a similar light: possessing a wealth of data suggests the ability to gain profound insights into businesses, societies, or future trends. However, this analogy oversimplifies the complexities of data utilisation. Unlike oil, which remains static and enduring after its formation between 65 and 250 million years ago, and has no expiration date, data is dynamic and subject to rapid obsolescence. Utilising customer data from a decade ago to inform present-day strategies proves futile; instead, data must be continually refreshed and updated to remain relevant. Furthermore, not all data are created equal.
From social media interactions and online purchases to sensor readings and GPS tracking, data is generated continuously by individuals, organisations and interconnected devices worldwide. This ubiquity underscores the sheer scale and complexity of the data landscape, presenting both opportunities and challenges for those seeking to harness its potential.
Concerns about data privacy, security, and algorithmic bias have emerged alongside the exponential growth of digital technologies. Addressing these concerns requires not only robust regulatory frameworks but also ethical guidelines and industry standards to ensure responsible data stewardship and mitigate potential harm.
Unlike the relatively homogeneous nature of oil, data comes in myriad forms, each offering distinct types of information and insights. Just as energy can be derived from diverse sources such as oil, gas, coal, or renewable options like wind and solar, data encompasses a spectrum of possibilities for driving innovation and understanding.
However, perhaps the most significant disparity between data and oil lies in their respective utilities. While extracting and refining oil presents challenges, these processes are often well-defined and standardised. Once an oil well is located, established methods exist for extraction, refinement, and distribution.
In contrast, data more closely resemble the raw materials used in construction, such as bricks, cement, and steel. Harnessing its potential requires not only skilled professionals but also meticulous planning and infrastructure. Once these materials are utilised for a building, there needs to be planning for connections to the electrical grid, water and sewers. Much like a sturdy building relies on a solid foundation, effective data utilisation hinges upon robust frameworks, such as well-designed data warehouses, lakes, or lakehouses. Engineers and architects play pivotal roles in constructing and maintaining these structures, ensuring the integrity and accessibility of the data within. Establishing efficient Extract, Transform, Load (ETL) processes further enhances the usability and reliability of data assets. Data needs similar infrastructure to be utilised effectively and integrated to provide insights.
Once all these aspects are considered, we can then decide to use our data to build a single family home, a condominium or a modern skyscraper, depending on the needs.
In essence, while the analogy of "Data is the new oil" may offer a convenient shorthand for discussing the significance of data in contemporary society, it is a very bad analogy. To unlock data's transformative potential is necessary to embrace its complexity and invest in the necessary infrastructure and expertise. That is the only way that organisations and individuals alike can be empowered to navigate an increasingly data-driven world.
In light of these considerations, it becomes evident that the analogy of "Data is the new oil" is both misleading and deceiving. While it underscores the transformative potential of data in driving innovation and economic growth, it also hides the need for careful stewardship and ethical oversight.