Big data: the favourite buzzword of business

Big Data (BD) has become somewhat of a rite of passage for most businesses. The desire to expand BD capability, research into it or at least make a big noise about its potential has proven popular with executives, shareholders and various media. As a result, BD innovation has been expanding exponentially since 2012 and in 2013 the segment hit the mainstream. London hosted more than 20 BD-based events and conferences in 2013, underlining the growing love affair with the segment among London corporate finance.

Moreover, investors pumped around $3.6 billion into startups focused on BD in 2013, which was almost three quarters of all the money that went into such companies from 2008 to 2012. In 2013, three $100 million big data funds popped onto the scene, such as those from KPMG Capital and Accel Partners. 2014 has seen no slowdown, with both corporate investors and tech majors looking to expand their data-mining portfolios. Many have asked therefore, why BD has become such a big hit and why the segment has made such a successful crossover into the corporate world.

The concept of Big Data BD has been borne out of this excess information lying on servers, devices and web pages across vast networks and mainframes. The growing realisation that data can actually be harvested, monetised and strategised is the underlying ideology behind the implementation of BD, which is creating entire industries and offering businesses additional revenue streams from previously dormant sources.

In its simplified form, BD is the gathering of large pools of data for a strategic purpose. Akin to a lab experiment, the terminology has come of age due to the growing digitalisation of society. Mobile phones, PCs and the Internet are all tools that collect data today at an unprecedented rate. However, while accessing data can be straightforward, making actual incisive use of it is the hard part, and this is where the opportunities truly lie.

BD is a big thing among analytical businesses, but its reach can extend to almost all platforms that process information:

  • BD is already an integral part of some segments. The online marketing segment, for example, is a major user of data-based solutions, whether through social media analytics or click-through statistics. Social networks such as Twitter and Facebook have become huge databases of consumer habits and opinions;
  • Finding a suitable buyer for accumulated BD has become a business in itself. Online classifieds platforms have been able to profit handsomely by recognising markets where their data is valuable. Major auto classifieds businesses, for example, are selling their data to car insurance firms;
  • Gaining efficiency through BD analysis is becoming a vital component of operational policy, and can be especially vital for public organisations that lack strategic cohesion. A report by the McKinsey Global Institute recognised as early as 2011 that the US healthcare system could save US$300 billion a year through better analysis of everything from clinical trials to health insurance transactions.

The BD market will certainly pick up even more steam going forward, and business transfer agents are monitoring the segment closely for innovative startups that can impact industries not yet convinced by the technology.

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