The rise of big data channeled through smartphones that make social media mobile and ubiquitous, is transforming the way financial institutions will do business
The rise of big data, channeled through smartphones that make social media mobile and ubiquitous, is transforming the way companies will have to make decisions, the way consumers will react to marketing and the way people live and do business in general, says Keith Holdt of Richmond, UK-based strategic business insight consultancy TomorrowToday.
Holdt spoke at the European Financial Information Summit (EFIS) sponsored by ClickZ's sister titles, Inside Reference Data and Inside Market Data. He challenged the financial industry and other industries to find ways to mine this great volume of social media-generated data to make businesses more effective and successful.
Global mobile data traffic is expected to reach 130 exabytes by 2016 - one exabyte equals the contents of 33 billion DVDs or 4.3 quadrillion MP3 files, Holdt said. This increase in data will be generated in part by the conversations being captured through all those smartphones - not just by voice, but through Facebook, Twitter and email transmissions, blog entries and more. "Ten years ago we were probably having those same conversations but with one or two people," said Holdt. "They weren't captured. They were verbal, so data was lost."
The problem this flood of data causes is that it is unstructured, he adds. "It exists and is valuable, if we can just work out how we can get access to it and connect the dots and begin to use it more effectively in work, the things we do and decisions we make," said Holdt. The new pools of social media-generated data could create "radical" power to know everything there is to know, he said, but the revolution will have to come through how all this data is processed - in "how we identify how to best use, analyze and understand it," he explained.
Google and Wikipedia have already changed the central quest in education to find out where knowledge and information are, not studying information and data, Holdt observed. This adds to the challenge of deriving conclusions from greater amounts of data. "We must ask how we can use [collected social media data] to make better decisions and change the way we invest," he said.
All this collected social media data does have the potential to predict the future, at least in the realm of political policymaking, according to Holdt. That is evident in the work of Prof. Dirk Helbing, chair of sociology at the Swiss Federal Institute of Technology Zurich, who specializes in modeling and simulations. The project he is leading, the FutureICT Knowledge Accelerator and Crisis Relief System, is in the running for a 1 billion euro grant from the European Commission. The system, as Holdt described it, would simulate everything at once and answer tough policy questions concerning economics, culture, epidemiology, technology, agriculture and other fields.
The trick to really making sense of big data as driven by social media data is to remember that it's people generating all that social media data, according to Holdt. "It's not machines that make the central and important connections among the data - it's people that do," he said, adding that deriving insights should be "about our customers and about people having deep, meaningful, insightful conversations. We need to learn how to listen. ... Data's value relies on human intelligence and how well managers and leaders formulate questions and results."
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