Why Is Data Called New Oil Nowadays?

We live in an age where data plays the most important role in our lives. We leave pieces of information about ourselves in everything we do, and it is now easier than ever to collect data about us. But why would someone need our data in the first place? Well, the answer is not that simple, and you might not like it. Read on!

Users vs Data

Most of our data was once stored on our hard drives, CDs, DVDs, and so on. We also keep a good deal of it offline, and if we encounter a problem with, say losing data from our PC, we can call some reliable hard drive recovery services to get our data recovered. In other words, we are considered owners of that data in a way, as long as it is stored on a computer we own and not shared with the world.


However, things have changed a lot when the Age of the Internet began. At the moment, the majority of residents of this blue marble we call Earth are on the web in one way or another. Therefore, every site we visit, and everything we search for on Google is recorded somewhere.

So, what can someone do with all the data we leave on the web? They can try to target us in order to advertise some products. If you have a Facebook account, you probably noticed posts labelled as ‘sponsored’. Interestingly enough, those posts are usually somehow related to things you like or consider interesting. In fact, you probably noticed the odd relation between those posts and things you recently talked about or liked on Facebook.

In the first quarter of 2019, there were approximately 2.38 billion active monthly users on the biggest social network in the world. Can you imagine the amount of data they leave behind every day or even every hour? As a matter of fact, the sheer amount of data left online is growing rapidly every second.

In other words, we are leaving so much information on the web that we create a perfect opportunity for big companies such as Facebook and Google to harvest that data and use it. Facebook never explicitly reveals personal data which can be related to any individual member of the social network (unless FBI or similar bodies from other countries require it for the purposes of an investigation).

Oil Companies Paradigm

Instead of revealing data, Facebook just collects it and uses it to sell the platform’s marketing service by targeting people with specific ads. For example, those who like soccer will likely get ads that are somehow connected to soccer. If you want to buy a new dishwasher, well, it is highly likely that you are going to get one such offer in your feed very soon.

Therefore, big companies collect data, extract valuable information, refine it, and sell it as such. Does that remind you of something? Well, that is exactly where the ‘new oil’ comparison comes from; all giant corporations pretty much follow the identical pattern oil companies used to make their businesses skyrocket during the past century.

The analogy actually works on several levels. We use oil to power motor vehicles, which helps us create and sustain a fast-paced lifestyle that paves the way for society and technology to move forward. However, data also helps us power the digital economy and set digital products in motion.

The Differences Between Data and Oil

Unlike oil which seems to be a finite resource that will be entirely exploited at one point in the future, data seems to be infinite at the moment. In other words, it is not a scarce resource as oil, but a cumulative one that keeps getting bigger and bigger.

Therefore, comparing data to oil might be useful to explain how certain processes work when it comes to data, but the comparison is not perfect. Data is unique in so many ways, and it is something we should all get familiar with, especially with how our personal data is treated on the web.

To sum up, the 21st century has brought many technological advancements which make our lives significantly easier. However, new problems have come to light during the past two decades too, many of which still haven’t been addressed properly.

One of the primary issues is the way data is handled on the web. Only when we really understand how and when our personal info is used can we start to feel safe. We must do our best to make the Internet more private. Also, instead of big corporations, individuals should be in control of the Internet.

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