The New York times has an article about a McKinsey report saying that Data Mining is the future. Although the attention from the New York Times is nice, and I still need to read the article in its entirety, I disagree with something in the article:
But the biggest single consumer benefit, the study says, is going to come from time and fuel savings from location-based services — tapping into real-time traffic and weather data — that help drivers avoid congestion and suggest alternative routes. The location tracking, McKinsey says, will work either from drivers’ mobile phones or GPS systems in cars.
The article then does a nice “pro and con” with the a nod to privacy concerns:
Personal location data raises privacy concerns. Both Google and Apple, for example, have faced protests recently for collecting location data without most users’ knowledge. The McKinsey report says such services should require that users have a choice and opt-in to use them, but the report does not deal with privacy issues in detail.
I disagree that the use of GPS is going to be the biggest plus. It really isn’t all about finding the closest Pizza Hut. Data Mining at its basest form is sort of like “Statistics++;” it draws intelligent conclusions from enormous amounts of data. GPS is just one type of data that affects consumers. Amazon.com shopping recommendations (which I love!) is another. There are countless other examples.
The Times does, however, get the conclusion right:
“The big dividend mostly hasn’t arrived yet,” said Tyler Cowen, an economist at George Mason University.
The McKinsey authors say that the big-data trend is just getting under way. It will take years, they say, before the gains show up in the economic statistics, just as it did for computers to prove they were engines of productivity.
“But it’s clear that data is an important factor of production now,” said James Manyika, a director of the McKinsey Global Institute.