Data mining: boon or bane?

Digital age has made data science an important tool – allowing corporations to reap immense benefits while simultaneously infringing individual privacy

It was famously stated by India's richest businessman Mukesh Ambani that 'Data is the new oil'. But he is not the first one to say so. In all probability, his speechwriter borrowed the phrase from Clive Humby, the man who built Clubcard which was the world's first supermarket loyalty scheme. He was using the metaphor to explain how data is a resource that is useless if left 'unrefined'. Only once it's mined and analysed can it create value, potentially extraordinary value. Humby created the first supermarket loyalty card for Tesco in 1994. In one year it became the largest supermarket chain in the UK.

A loyalty card tracks its customers and forces them to remain loyal with enticing offers. The loyalty scheme tracks the customer and his/her buying habits. In a digital market place when we check certain products, like window shopping perhaps, we keep receiving push up advertisements of products we had searched. The other day on my Amazon account, I received several offers on mops since the other day we had bought one for home use. Amazon's data realised that here was a customer who enjoys buying mops. By the use of data which has been mined suitably, even a drab job like buying mops can turn into an 'exciting' engagement.

Data Science helps E-commerce businesses gain a more complete understanding of customers through capturing and integrating web-behaviour of customers and their life events, which led to the purchase of a product or service, following the interaction of customers with various channels. AI allows businesses to collect and research information in real-time, thereby enabling greater effectiveness and company competence.

Like crude oil, data too must be processed. If you are a TV viewer, the channel needs to know how frequently and for how long do you watch its content. To measure this, one needs to draw a sample and place a device at your home to check your TV-viewing habit. The carefully created sample homes eventually generate a TV audience measurement. This information is not always accurate, however. One may keep the TV set switched on without being present near it. This will inflate the captured data and reduce accuracy.

To avoid this, technology came up with a solution. All one needs is a camera attached strategically so that the face of the viewer is captured. This can then serve as a foolproof method of collating data. Advertisers and show producers can then use the data. While data is important, two factors are necessary to use the data correctly. First, care must be taken to collect data correctly. Second, the data needs to be analysed smartly. For instance, if Amazon carries on posting new mops on my account without bothering to note that it was a one-off purchase, the effort will be wasted one.

Businesses can use data to improve their competitiveness. At the same time, sourcing and analysing data create new business models. Rating of television shows mentioned above is one such use. This helps businesses to keep tabs on their rivals. If a mobile manufacturer knows at what price point and with what specifications his rival outsells his products, then the manufacturer can easily reformulate his business strategy. The market becomes more competitive making life exciting for the consumer.

In fact, data is a great benefit for all, for good or bad. Carefully mined data can help a government to identify the issues which are viewed unfavourably by its citizens. This gives the administration an opportunity to rectify its steps. But often enough rulers feel that the subjects are fools and those opposing need to be "educated". In that case, data comes as a blessing to the not-so-educated maybe at the cost of freedom of expression, the very foundation of a democratic society.

The data obtained can be used with or without consent. The private sector has long used such practices where it can track anything that one does. Those who vehemently opposed the introduction of biometric card Aadhaar seem to have been curiously oblivious of a product called Google. In 2016, the European Union had an anti-trust investigation on Google's Android platform. It may sound queer, especially given how Google left the critical android platform free to its users. This act may on the surface even appear generous but that is simply a matter of appearance.

The benefit for Google was simple if not straightforward. Google bundled the applications into its play store. Manufacturers were required to take licenses for pre-installing Google play on their devices. Thus, Google search, mail, YouTube, Google maps, etc., all came standard for the users of the devices. Even non-Android Apple devices added Google as an optional service provider. The advantage of mining data free and from everywhere gave Google an unmatched power. Effectively, Google could spy on each and everyone using its system. The Aadhaar card system of India could not track even a fraction of this information.

A related issue to Data snooping is the discussion regarding the flow of data. Should it flow seamlessly across countries or like crude oil be stored within a country? According to Nick Clegg, who is the global head of public policy with Facebook, the true value of data comes from the free flow. Given the business model of Facebook, Clegg has to advocate free flow. The importance of platforms like Facebook lies in their reach across culture and geography. But does this reach hurt the interests of a sovereign nation? To put it differently, how will sovereign interest be affected if Amazon knows who is buying a mop in Delhi?

Any light-hearted dismissal of such a serious issue may not find many takers. There is still a distinct opportunity for such snooping software to be sent to the mobile devices of higher-ups and then information being extracted for use in espionage or blackmail. There are certain programs which can capture voice even when the phones are not in use. This can be a potential threat. Can such threats be nipped in the bud if data is stored locally? Can data captured through Google-initiated android devices used in India be stored only within our borders? What is certain is that we have passed the age of controlling the digital world long ago with data emerging as the big brother.

(The views expressed are strictly personal)

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