There is no dispute; data is growing exponentially… and it will continue to grow, both in volume and complexity. In general, the more of a resource there is, the less value any individual item holds – like a commodity. Due to the economic laws of supply and demand, the more of a commodity exists, the lower its price or value. In this way, individual data points can be viewed as a commodity, similar to oil or gold. And similar to fuel or precious metals, data has been used as a means of doing business, hedging risks, investing and even speculating for decades or even hundreds of years.

This commoditization of data did not happen overnight. Data comes in many sizes and shapes and is formed from a vast range of sources. Advancements in technology have contributed to the data deluge, with unstructured data volumes increasingly generated not only by the human workforce, but by machines, generating petabytes of data on a daily basis.

As we look at this trend of growing data stores, each individual data point is effectively undifferentiated and, on its own, conveys limited value - just like a commodity. The typical rational approach to managing undifferentiated goods is to reduce their cost as low as possible. This is often the approach taken by storage professionals as they focus on the cost side of the data equation.

However, something unique happens when you take all the individual data points, and consolidate them into a centralized repository. By aggregating individual data points, the value becomes greater than the sum of its parts. By delivering a holistic view of the sum knowledge of the organization and exposing it to statistical and predictive analytics tools, strategic competitive value can be gained from the data. The aggregated data suddenly becomes so crucial and proprietary that its value is unparalleled and irreplaceable to the organization.

For instance, Oil and Gas companies invest exorbitant amounts of money launching a seismic survey, often costing in the tens of millions of dollars. The high resolution images they capture during the voyage are hundreds of GB to TBs in size, driving up the storage cost. While at the time, it may not be economically viable to exploit the implied natural resources, those reserves may be extremely valuable down the road. As time passes, it is only through the accumulation of additional data including further seismic imagining and simulations assessing new approaches, combined with additional data about the financial markets and expected cost of natural resources and the forecast cost of exploiting the reserves, that the aggregated data can be used to make the decision to move forward. At that time, it is the organization with the best array of consolidated data that will be first mover, exploiting the opportunity in a zero sum game where the winner takes all. Each individual datum is not enough, it’s just when data is leveraged in a strategic and holistic fashion that it becomes invaluable.

While the value of any given seismic image data point can often be negative due to the cost of acquiring and storing the data, ten years down the line there may be a technological breakthrough or oil may become so scarce that the price is substantially higher, when the O&G company would pull their data out of the long term repository, migrating it to the analytics store to assess whether has now become economically viable to exploit the natural resource. By this time, the data is potentially worth billions of dollars if through optimized data management the organization is able to identify the potential before competitors.

Thus, when collected, stored, and managed properly, data is the only commodity with increasing returns to volume, becoming more valuable the more of it there is. Organizations seeking merely to reduce costs of data are missing the massive opportunity it provides. By bringing data together across business and hardware silos and providing tools to drill down into that data at the content level to understand its meaning, organizations can exploit it and ultimately realize the value that it embodies – the crown jewels of the firm.

So although individual data points have relatively minimal value by themselves, when consolidated into a data centric repository, deploying solutions such as data defined storage, substantial value and a competitive edge can be gained. Having this central repository of information at your fingertips allows for increased productivity and the ability to make a good timely decision based on good data, one that will bring enormous value since the competition has not seen its potential yet. Better to focus on the value side of the data equation; the costs are just at the surface.