Why I Regret using the "Data is the New Oil" Analogy
Romi Mahajan
Chief Executive, Chief Marketing Officer, Science-Commercializer, PropTech Advisor, and Strategist, Author, Investor
I’m guilty as self-charged. I’ve been in the “data” business for quite a few years and- more times than I can count- I compared “data” to “oil,” largely by suggesting that “Data is the New Oil.” A cliché no doubt but one that made for great speeches and amazing power point presentations. After all, the analogy is - on the surface- amazing- Oil is a source of tremendous wealth, as is Data. Further, data, like oil, has to be gotten (Exploration), refined, and marketed in order to be converted into money. I, like so many others, also used the pictorial conceit of an oil rig gushing zeroes and ones to make my point.
I realize now that the analogy is a terrible. I realize, also, why a better analogy has us comparing data to water.
So why is this amazing rhetorical gambit- backed by a talk-track and pictures to boot, so poor? It is very simple- no country or company ever says, “I simply have too much oil…woe is me!” Outside of the obvious environmental effects, more oil is, well, good for business. But the opposite is true with data- the more the data, the more likely the organization suffers from data-induced indecision and confusion.
Here’s where water comes in. Water is – clearly- a source of real value (life depends on it) but when there’s too much of it, both fields and bodies can become water-logged. Too much water can render lush fields fallow and healthy bodies functionless. Water gives and destroys ecosystems. Data, is in that sense like water.
Analogies are fraught with issues for they are never perfect and often lead us to strange conclusions as we map elements from one onto the other.
I regret the “Data is the New Oil” analogy that I’ve used so many times. It's slick no doubt but in the end it muddies the waters.
Senior Research Analyst - Data, AI & Analytics at S&P Global Market Intelligence
5 年I think "data as the new oil" is actually particularly fitting, it's just that the analogy stops too soon with the focus on profitability and value. Oil was incredibly profitable and valuable in the industrial economy when exploted, and so is data in the digital economy. But there will always be negative rebound repercussions. Just as over-exploitation of fossil fuels led to detrimental environmental effects, over-exploitation of personal data will have detrimental effects on human rights and autonomy.
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5 年Actually, Bill Schmarzo has what I consider to be an even better analogy; he says that "data is the new sun."? It never depletes and it can be repeatedly deployed across any number of uses.??
Developer Advocate | Product Marketing | Analytics, AI, Data Integration. A veteran of data governance, AI, and data management.
5 年They are both good metaphors, Romi. Both water and data flow and ebb and can be problematic when you have too much.? No doubt a great metaphor when you talk about architecture and flow. However, the oil metaphor works when you're talking about the underlying currency that drives this era's economy.? We have moved from a gold/materials standard in the days of the Rockefellers, to an oil standard in the OPEC heydays, to today, where data is the underlying currency that determines the value of something. Just ask Facebook, Google, LinkedIn, Netflix, etc.?
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5 年Good point - thanks for the clarity.