Data – The World’s Most Valuable Resource?
By Luz Cuentas
It is strange to think that this notion was first proposed in 2006. At the time, the exponential growth of social media as an integral part of many people’s lives across the world was at its infant stage. Yet this is what British mathematician Clive Humby remarked when he said that “Data is the new oil.” It is worth noting that this idea only really became more widespread and a popular source for debate when The Economist released an article in May 2017 called “The world’s most valuable resource is no longer oil, but data.” The question resurged again this year following the premiere of Karim Amer and Jehane Noujaim’s documentary film “The Great Hack” at Sundance Film Festival. “The Great Hack” is centred around the 2018 Facebook-Cambridge Analytica scandal. Its subsequent rave reviews by critics resulted in the release of their documentary on streaming giant Netflix in July which gained this notion even more exposure to a global audience. Ring the alarm bells, your personal information has now replaced oil as the world’s most valuable resource. Or has it really?
Oil as the World’s Most Valuable Resource
Just over a century ago, oil was undoubtedly the world’s most valuable commodity – and with good reason too. Global crude production of oil was at its highest at the start of the 20th century since its emergence in the mid 19th century. However, it was only after the 1950s that oil emerged as the global powerhouse of energy supply, replacing its predecessor, coal. Taking the example of the American oil market in the 1880s, the implementation and subsequent rise of managerial capitalism as a way of structuring the business by John D. Rockefeller and 39 other allied companies owned by his associates led to the establishment of the Standard Oil Trust. This resulted in the Standard Oil Trust controlling almost 90% of the kerosene produced in the United States – one of the earliest examples of modern monopolies. The economies of scale generated by Rockefeller and his partners led to oil overhauling coal as the primary source of energy powering the United States. This example soon occurred in many other countries worldwide. Coal was replaced by oil as the world’s most valuable commodity because oil became much cheaper and more accessible than coal despite both of them being finite.
The Rise of Data
So, where does data come into all of this? Well, oil seems to be running into the same problems that its predecessor, coal ran into at the turn of the 20th century. The argument for data becoming more valuable than oil as a resource is not as ludicrous now as it was in 2006. Why? Oil is of course finite too. Many would argue that data is also much cheaper and more accessible now than ever before. Most of us hand in our personal details and information to “The Big Five” technology giants Alphabet (parent company of Google), Amazon, Apple, Facebook and Microsoft on a daily basis. We can also access all of these websites, software services and social media platforms for “free”. Likewise, these technology giants can also access our personal data and possibly more for “free”. Hence, this argument is definitely more valid and logical now more than ever. “The difference between oil and data is that the product of oil does not generate more oil (unfortunately), whereas the product of data (self-driving cars, drones, wearables, etc) will generate more data (where do you normally drive, how fast/well you drive, who is with you, etc).” This remark was made by Piero Scaruffi, author of “A History of Silicon Valley” in 2016. Hence this leads us to the conclusion that unlike coal and oil, data are not finite.
Data reserves will not run out the same way an oil reserve will because the human population will undoubtedly keep growing. This of course leads to an infinite source of data from future generations. Our data is also much cheaper and easier to access now as seen in “The Great Hack” with the 2018 Facebook-Cambridge Analytica scandal. So our vulnerability to have our political views influenced and potentially changed using these “The Big Five” technology giants is potentially at its maximum threat level. Can a monetary value be placed on such a concept? Maybe not but all of these arguments pave the way for the proposal of data being the world’s most valuable resource as a very convincing notion.