Will Big Data'S New Era Become As Important As Oil Resources?

Data is the new era oil "is a successful slogan, but it is only half right, data is valuable, but it is not oil in essence.

Each of us does not like monopoly, except monopolist.

Because for the general public, monopoly often means higher prices, worse products and less good services.

No wonder that Jonathan, who had been a tour agent for Bob Dylan, worried about the monopoly of the digital age in the book "fast action, breaking the tradition: why Facebook, Google and Amazon monopolize culture and weaken democracy". He also proposed to examine the control of big data by Amazon, Facebook and Google.

Coincidentally, MargretheVestager, the competition commissioner of the European Commission, known as "technology giant", also said: "data may be an important factor in how to influence competition in mergers and acquisitions." Margaret Vistag

We are exploring whether to intervene in mergers and acquisitions involving significant value data, even though companies that own data do not have high turnover.

This new view of academic and regulatory focus on "data monopoly", but what is "data monopoly"? Does it really exist?

"Oil in the new era": a misreading?

Since the economist has likened data to oil in twenty-first Century, the importance of data has become a household word.

However, this analogy is misleading, because it is not only easy to associate with Rockefeller's Standard Oil Corporation or Mobil Oil Corp, but also mistaken that the current data, like one hundred years ago, become a highly profitable and lucrative commodity in the market.

However, the real scenario is that the formal data trading market has not been formed at all, let alone the data predators in the data market.

The reason is simple: data is not real oil.

Data is not scarce.

The limited amount of oil is firmly controlled in the hands of a few oil producing countries such as OPEC and Russia.

On the contrary, data are everywhere and are endless.

With the development of Internet, Internet of things and intelligent terminals, new data are generated every minute and second, and as long as online users are online, the numerous electronic footprints will be recorded and collected.

As the IDC report shows, the volume of data in the world has increased by 58% every year in the past few years. By 2020, the total global data will exceed 40ZB (equivalent to 4 trillion GB), reaching 22 times the total data in 2011.

Not only that, but because data can be produced and allocated at zero marginal cost, there is no real obstacle to acquiring data from different sources, such as the third party or the other.

Data are not exclusive.

Oil can only be owned and consumed by specific enterprises, and data are different. It is collected and used by an enterprise, not at the expense of others.

As a network user, we can accept different network services provided by different enterprises, or even the same kind of services, such as Baidu knows and knows.

This network economy feature called "multiple affiliation" has dispersed our data to various network platforms, so that no enterprise can monopolize all data.

Non exclusiveness also means that even if an enterprise has specific data, it can not prevent others from getting the same data through other channels.

It is for this reason that in Sina micro-blog's lawsuit against unfair disputes, the defense and defense related data are obtained by using the "collaborative filtering algorithm" and not obtained from micro-blog to prove the legitimacy of their data.

The value of data is not permanent.

Oil is not a diamond that is "forever and forever", but it has no validity period, and its value is difficult to reduce.

Storing oil for a long time is of great value. Data is a typical aging product. Old data is not as valuable as new data, and as time goes on, the former becomes more and more worthless.

Just as Mr. Wang Jian's online book has seen, big data, rather than "big" data, is rather a live online "live" data.

Therefore, the advantages formed by data accumulation will quickly disappear, because the life of data is limited, once they are "dead", it will be worthless.

Data do not have legal owners.

For hundreds of years, a set of rules and regulations with clear ownership and clear boundaries has been established around oil, and data property right is still a confusing account.

Recently, around the European Commission's opinions on the construction of European data economy, European academia has debates about whether data property rights are set up and how to establish it.

Based on pragmatism, the United States only standardizing data collection, utilization and circulation.

China has included the data for the first time in the general principles of civil law, which came into force this year. However, due to the lack of rules, it is only necessary to declare the significance of "data being protected by law".

More importantly, data and personal information, privacy and other related personality rights are not clear, further affecting the establishment of data property rights.

"Clearly defined property rights are the precondition of market pactions" (Kos), and the "failure" state of data naturally makes the development of the data market difficult.

In short, "data is the oil of the new era" is a successful slogan, but it is only half right, data is valuable, but it is not oil in essence.

Can data determine the competitiveness of enterprises?

If data are not output, then we can change the view that whether data can be used as input (input), thus forming the source of competitiveness of enterprises. At present, the "digital economy with data as the key element" has been widely recognized in the world. How can we understand the role of data in enterprise competition?

First of all, we must admit that data is an important factor in the development of enterprises.

The technological innovation of digital economy has completely changed the traditional way of data utilization.

Nowadays, enterprises can improve products and services through data learning effect (learningeffect).

For example, Youtube can collect the click information of each user to correct and improve the algorithm so as to attract more users.

Enterprises can also provide customized products based on the "user portrait" of big data, and set personalized prices according to their consumers' ability and price sensitivity.

In addition, enterprises can make use of the data two times and develop new business opportunities.

Recently, the United States group of e-commerce website opened up the "American group taxi" business, which is a vivid example.

However, the role of data should not be overestimated.

Throughout history, enterprises with huge amounts of data failed.

First of all, the advantage of data is easy to be weakened.

On the one hand, data are separable and highly differentiated.

Based on the observation of long tail theory, different consumers tend to lead to more accurate and more suitable network service providers in online shopping, online dating, social networking, online travel and other scenarios.

Therefore, successful enterprises must tap their own niche market rather than blindly follow the leader.

Differentiated competition makes valuable data available to others.

On the other hand, data itself can be replaced.

A company that embedded sensors into roads to collect data on traffic jams will soon find that with the use of automatic video analysis and mobile navigation technology, its data has become the second choice.

Secondly, data can not bring advantages independently.

According to Mr. Hu Ling's analysis, the competition of the network platform is carried out in four dimensions: "resources, data, algorithms, basic services".

Specifically, through the reduction of paction costs by information technology, the productive resources are constantly increasing. With the activity of the former, a large amount of data is generated. Then the enterprises use algorithms to dynamically analyze and predict the data, and ultimately improve the basic services accordingly.

Obviously, data is only an intermediate link, and it is not and cannot be decisive.

This also explains why data giants fail: the acquisition of AOL from time warner to Microsoft's acquisition of aQuantive, a network advertising company, has reduced, rather than enhanced, their competitive advantage.

On the contrary, start-ups can also stand out in the digital industry that seems to require large amounts of data to survive.

When Tinder landed on the online dating battlefield in September 2012, it didn't have any user data, but with a simple user interface and precise attention to consumer demand, Tinder quickly became the market leader. So far, Tinder has witnessed 20 billion successful pairing as the world's most popular dating applications.

Finally, the power of data is very fragile.

The digital economy is a highly innovative industry. What's more, under the two point structure of "disruptive innovation" (DisruptiveInnovation) and "maintenance innovation" (SustainingInnovation), its innovation is more biased towards the former than the latter.

This means that in a constantly changing and rapidly competitive environment, the competitive advantage of data giants will be destroyed by completely unanticipated competitors and business models, and will even turn into a disadvantage.

Worse still, the thoroughness of this change combined with the network overturn effect (TippingEffects) often makes decisions based on historical data wrong.

MySpace and Facebook passed by, AltaVista and Lycos lost to Google, NOKIA gave way to iPhone, Google+ met Waterloo, YAHOO changed its name to "Altaba", and there were so many events.

In a recent article, economists Anja Lambrecht and Catherine E.Tucker carefully reviewed the view that data is the core competitiveness of enterprises. They think: "in a changing digital economy, there is almost no evidence that exclusive possession of data can completely exclude the supply of better products or services.

To build sustainable competitive advantage, the emphasis of digital strategy should be on how to use digital technology to bring value to users in an unprecedented way.

In this regard, the "data is the new era of oil" has a hidden meaning, that is, possession of data is far from the value of development data, just like an oil giant is not an economic power, and this is not the alternative use of "resource curse".

It is for all these reasons that although regulators in the US and Europe have expressed concern about data monopoly, they did not take radical anti monopoly review measures against data in the case of Google acquisition of DoubleClick, TomTom's acquisition of TeleAtlas, Facebook's acquisition of WhatsApp, Nielsen acquisition Arbitron and so on.

Of course, it is unnecessary to mention that the collection and utilization of data by data giants will bring challenges to the general public's personal information rights and privacy rights, but this is already a story outside the anti-monopoly law.