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In our many travels, conferences, speaking engagements, and other interactions with customers, technology vendors, press and others, we seem to often hear the same refrain: “Data is the new oil” as if that’s supposed to mean something profound. The first time we heard this expression (many years ago, we should add), it was an interesting point to make about how “important” and “strategic” data is. But every time we’ve heard it since, we’ve grown tired of that expression and even more so surprised that people are comparing a dwindling, dirty resource we’re increasingly running away from to a resource increasing almost infinitely that we can’t get enough of. So, why is this expression used, and can we honestly, finally, please kill it?
STOP SAYING DATA IS THE NEW OIL. PLEASE
The expression Data is the New Oil originates from as early as 2006 when Clive Humby from Tesco in the UK said that “Data is the new oil. It’s valuable, but if unrefined it cannot really be used. It has to be changed into gas, plastic, chemicals, etc to create a valuable entity that drives profitable activity; so must data be broken down, analyzed for it to have value.” Since then, this perhaps throw-away analogy was latched onto by increasingly more people with louder bullhorns, including Ginny Rometty, IBM CEO, and Peter Sondegaard, SVP of Gartner. The primary objective of the analogy is from a few perspectives. First, like oil, data has strategic value in that who owns it controls a lot of resources. Second, the idea is that data by itself has limited value much like oil must be refined to capture value. Third, the idea is that oil has commodity value that can be exchanged for valuable goods and money in much the same way that data can be exchanged, traded, and dealt with as a commodity with inherent value. Those points are good ones. But you can make the same points about any natural resource, including solar energy.
But the value of the analogy stops there. Oil is a natural resource that decreases in quantity and availability increasingly over time — this is why it’s called a fossil fuel. It’s made of dead things. Oil is dirty, requires huge amounts of effort to extract from the earth, refine, and transport around the globe. It’s stored and sits idle, often for long periods of time. And once it’s used, it’s gone. Oil wealth is concentrated in a few nations with spotty political and social behaviors, and is the subject of wars and international disputes. We’re trying to free ourselves of the oil economy.
Data on the other hand, is for all intents and purposes limitless in its volume, quantity, and availability. It grows even when you don’t want it to grow. Go to sleep with 1 Terabyte of data and wake up with 2 Terabytes of data. Data is easy to generate and cheap to transport. Data can be reused, repurposed, and new insights can continue to be gleaned from old data. In the information economy, data is …