Free digital data on the internet is such a big deal it has acquired a label, big data. You’d better understand what it is and how you can benefit from it or you’ll lose some of your wealth. I benefitted from it and a traveling companion and I avoided losing hundreds dollars.
Corporations are mining big data to capture wealth. The McKinsey Global Institute, the research unit for consulting firm McKinsey & Co., published a 2011 report called Big Data: The Next Frontier for Innovation, Competition and Productivity. The report advises clients on how to capture the value of big data.
Google and Facebook are using big data to dominate the internet.
“The ability to understand data would be the most powerful skill in the twenty-first century,” said Eliot Shrage, an early executive at both Google and Facebook, according to the book Plutocrats: The Rise of the New Global Superrich and the Fall of Everyone Else, by Chrystia Freeland.
Google and other organizations use big data to translate languages for anyone for free, an obvious benefit for me but not necessarily professional translators. I used a free Internet translator to convert an English Power Point document into Spanish for a presentation to a bi-lingual group. I simply copied the sentences into the translators in a process that seemed magical and free.
Technology translators are not magical. They collect other people’s translations into massive electronic files called ‘translation memories.’
[Automated translators] gather information from real live translators who have translated phrases, and then when your example comes in, [computers] search through that to find similar passages and creates a collage of previous translations,” said Jaron Lanier, a pioneer software engineer, who was quoted in the January 2013 Smithsonian.
When I translated a paragraph for this column, a click on Spanish phrases revealed different possibilities, presumably translations for which translators were paid. Human translators looking for work compete against their and others’ work copied for resale without compensating the originating humans. At some point I may need to pay monopoly-sized firms for automated translations, joining human translators watching monopolies capture more of our wealth.
The airline industry uses big data to offer incentives to passengers or charge higher prices based on a flight’s occupancy rate.
“If there is a long lag in sales, resulting in the flight still being well below occupancy as the departure approaches, prices might undergo a major dip,” said a recent trip-advisory in USA today
A fellow traveler and I used big data to avoid a sudden rise in prices for airline tickets. My companion spent much of February 8th searching websites for the best prices for five tickets on flights from Seattle to New Orleans. Early in the day he saw prices around $380, but the quickly changed to $531 for the rest of the day.
He stopped searching and that night I found prices in the $380 range for one ticket by using an apparently consumer friendly website called yapta.com. I clicked on a button called ‘fare history chart’ that displayed the fare history for flights between our cities. Low prices had languished during much of January followed by a spike to over $500 on the day my companion was searching. I suspect his repeated searches drove industry algorithms to raise prices to meet an anticipated spike in demand for specific flights on specific days. If I ran the airlines, that what I’d want my algorithm to do.
Yapta also produced the best matrix I’ve seen that showed the value of changing departure and arrival dates. We stopped searching and strategized.
The next day we changed our return date. He bought three tickets at $380 and I later bought tickets $24 higher.
We can take advantage of tools for big data to save us time and money. But there is a fierce debate as to whether future middle- and lower-classes will be equitable beneficiaries, or whether giant firms will capture a disproportionate amount of wealth at the expense of the middle and lower classes.
That debate about our future and big data is the focus of my next column.