Abstract
“Big data”—the collection of vast quantities of data about individual behavior via online, mobile, and other data-driven services—has been heralded as the agent of a third industrial revolution—one with raw materials measured in bits, rather than tons of steel or barrels of oil. Yet the industrial revolution transformed not just how firms made things, but the fundamental approach to value creation in industrial economies. To date, big data has not achieved this distinction. Instead, today’s successful big data business models largely use data to scale old modes of value creation, rather than invent new ones altogether. Moreover, today’s big data cannot deliver the promised revolution. In this way, today’s big data landscape resembles the early phases of the first industrial revolution, rather than the culmination of the second a century later. Realizing the second big data revolution will require fundamentally different kinds of data, different innovations, and different business models than those seen to date. That fact has profound consequences for the kinds of investments and innovations firms must seek, and the economic, political, and social consequences that those innovations portend.
Highlights
We believe that we live in an era of Bbig data^
Technology firms like Google or Facebook have led the pack in finding uses for such data, but its imprint is visible throughout the economy
The expanding sources and uses of data suggest to many the dawn of a new industrial revolution
Summary
We believe that we live in an era of Bbig data^. Firms today accumulate, often nearly by accident, vast quantities of data about their customers, suppliers, and the world at large. The expanding sources and uses of data suggest to many the dawn of a new industrial revolution. Those who cheer lead for this revolution proclaim that these changes, over time, will bring about the same scope of change to economic and social prosperity in the 21st century, that rail, steam, or steel did in the 19th. This Bbig data^ revolution has so far fallen short of its promise. Tomorrow’s hopes for transforming real-world outcomes in areas like health care, education, energy, and other complex phenomena pose scientific and engineering challenges of an entirely different scale
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