Data is the Currency of the Information Revolution
Imagine a world where enterprises won't have to store their growing volumes of data themselves. Imagine the data bank -- where you'll be able to deposit and store data much like commercial banks store money today.
By Terry Keene, CEO and President, iSys Capital Technologies
The information revolution started with the ability for anyone to find out anything at any time. It's that simple. It's not about computers, data, networks or even the Internet. It's about the conjunction of all those technologies with the individual desire to ask any question and get an answer -- about anything.
A UC Berkeley study, How Much Information? 2003, estimates that we stored 1-2 exabytes of electronic data in the year 2000, and more than doubled that per year by 2003. The newest estimates are for 8 zettabytes of data to be stored by 2015, and that's just electronic data, excluding video, print and broadcast. How do we manage all that data?
Today, we hoard data on hard disks and optical/tape media in our own data centers and backup facilities for fear of losing or compromising it. Data is our leverage in a desperately competitive world. Not unlike the early days of financial growth in America when fiat currencies were in their infancy, and banks were mostly local and vulnerable to attack by masked marauders, thieves, fires and natural disasters. Consequently, the early Americans stashed their newly earned cache (cash) in tin cans and buried them in the back yard or stuffed the bills under their mattresses. There was no leverage advantage to these methods of storage but at least the risk was controllable. Not too dissimilar from our current methods of storing data today.
Spinning hard disks, tape, and optical media are stored and controlled individually by each organization. There is little leverage advantage but the risk is mitigated. What happens as the data doubles, triples or quadruples over the next 24 months? Storage density is not increasing at that rate. Current magnetic hard disk (HDD) areal density is projected to grow at a compound annual growth rate (CAGR) of 19 percent, -- from 740Gb per square inch to 1800Gb per square inch through 2016. Electronic data growth is projected at a CAGR of more than 33 percent. Put simply, more data is being stored than the growth in storage density will support. In other words, buy more storage or fall behind those enterprises that can!
Data is the currency in this new information society. Leverage is in analyzing that data, correlating it with other data sources, and using analytics and cognitive methodology to create information that has never before been discovered. That is the investment that corporations will have to make as the information revolution further unfolds.
How is that possible in a world where metadata -- data about the data -- is growing at a rate that exceeds the original data growth?
The good news is that enterprises won't have to store all that data and metadata themselves. Enter the data bank -- where you'll be able to deposit and store data much like commercial banks store money today. Like commercial banks, data banks will provide leverage to share, borrow and barter data among corporations much like commercial banks can loan, invest and distribute money. Data banks will provide "data liquidity" among enterprises that are collecting and correlating diverse data about customers, products, industries and markets in order to find new opportunities by mining that data. Large organizations are already creating data clouds that store data and applications for metered use. The largest of the cloud providers, IBM, Google, Ebay and Amazon, for example, are well prepared and capitalized to provide data banking services with little change in their current operations. It will be trusted brands such as these that will form the basis of our new data banking system. It's only a matter of time. The market is here and ready.
These new data banks will be subject to regulatory and fiduciary constraints similar to those of their commercial counterparts, but the possibilities and economies of scale are boundless. As the computer industry matures into a mass commodity information market, entities willing to share their proprietary data with other complementary entities will hail the beginning of information cooperatives. The transformation of today's data centers into information manufacturing factories, mining and correlating new found data sources, will transform how this industry provides real, actionable insights to their customers. The years of operating cost-plus data centers are over. The only survivors will be competitive information manufacturing factories that can deliver unique insights that impact corporate strategy.
Data analytics and cognitive analysis of seemingly disparate bits of data will provide real value to organizations. Without data banks, corporations will not have access to data tightly hoarded by other corporations. Combining amalgamated corporate data with social media, travel patterns, weather, current events, sporting events and retail buying patterns, for example, could breathe new life into any organization willing to stretch their corporate imagination.
Today, most IT organizations collect and report historical data to their information customers. Sales, general ledger, payables, payroll and personnel information are historical. Organizations need this information for reporting purposes, but little of this information will help companies identify potential markets, products or services that drive revenue and customer retention. Driving revenue, profit and earnings per share need a much broader view of what people think, why they react, and how they buy. That comes from true big data analysis.
Big data is not about the size, scope or source of data. Big data is about how data -- any and all data -- is correlated and analyzed to provide new perspective. Big Data is discovering not only what people think but also why they think and how their thinking can be influenced.
Insights into people's psyche will never unfold from accounts receivable. It's time to set up a data account and start banking.
Terry Keene is CEO and president of iSys Capital Technologies. He has more than 30 years of experience in the computing industry and has consulted for thousands of companies worldwide. Terry founded iSys in 2002 and has grown the consultancy into a multi-million dollar business specializing in low-latency technology infrastructures. Clients include some of the world's leading financial exchanges, as well as some of the newest trading venues in the emerging markets. Terry has a MSEE degree from Georgia Tech and was an undergraduate at the U.S. Military academy, West Point, NYC.