Lost in the Big Data Universe
Skeptics at this point might say that much of what is being called Big Data by any of these definitions is just a logical extension of what we’ve been doing for years with enterprise systems (ERP) and business intelligence software. And they would be right. In fact, so great is the interest in this burgeoning opportunity, that we are almost in danger of making the Big Data market the equivalent of the IT market itself—redefining Information Technology as Big Data Web 2.0. That may be where we’re moving, because if we go back to our definition of Big Data—large amounts of digital data being captured and sold from a wide variety of sources, and the tools and technologies to store, retrieve, and analyze that data for greater insight—that does put Big Data right at the heart of the digital economy and IT platforms of the future.
But Big Data is not just about technology. If nothing else, public acceptance of personal data being captured and sold without consent or compensation marks something of a cultural revolution. Even if Big Data is just an evolutionary step, it is an important one because businesses of all stripes will find it hard not to be sucked into the vortex as a participant. It’s hard for any organizational leader to resist the temptation of this type of “revolutionary” technology because the sales pitch promises real opportunity: Every retail company is being told that it can sell its data for huge profits and analyze that same data to provide uniquely successful advertising to customers; doctors can help patients, policemen can catch criminals, insurers can revolutionize their underwriting and actuarial services, and bankers can use advanced algorithms and computerized trading to better understand the market and their customers to make a fortune.
Most importantly, Big Data involves big money. Record-high technology stock valuations, mega-profile acquisitions, and enormously profitable public offerings in this area are fueling an unprecedented digital stock boom on both sides of the Atlantic and in Asia. Gauged by any measure—IPO valuation, investor capital, merger and acquisition activity—the arena is a gold mine. Because the boundaries of the Big Data market are unclear, estimates to its value vary, but at its most narrow interpretation, Wikibon estimates that “pure play” Big Data vendors (independent hardware, software, or services vendors whose Big Data-related revenue accounts for 50% or more of their total revenue) will expand in the United States alone from $18 billion in 2013 to more than $50 billion by 2016 (see Figure 1.5).21 The International Data Corporation (IDC) predicts that the market for Big Data will grow six times faster than the overall IT market.
Figure 1.5 Overall Big Data Market Growth
But if we look at a broader interpretation of the Big Data market that includes global tech companies, media, and telecoms (which in the following chapters we see are quickly becoming more of a single, consolidated industry dependent upon digitized data and the Internet), that number climbs enormously. Big Data-related mergers or acquisitions racked up a record $54 billion in transactions in the first three months of 2014 as the industry’s powerhouses scrambled to buy up the important digital technology products of the future. If we include media and telecoms, mergers and acquisitions activity in those areas was an astonishing $174 billion in that single quarter.