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Why Create a Clean Data Economy?

by: Ted Flanagan
Blog Why Create Clean Data Economy

It’s a commonly used metaphor: data is the new oil. But, as we sit here in 2021, with both our atmosphere and public sphere polluted and quite literally melting down, it’s time we asked: Is that a good thing?

It's time to build a clean data economy


Data, like oil, is a fuel source that powers the engine of our modern economy. But as we’ve come to learn with fossil fuels, that engine does not run clean. When we examine the data-as-oil metaphor from this angle, the parallels are both striking, and alarming.

While it took us three centuries into the Industrial Revolution to reach the current tipping point, in true “Moore’s Law” fashion, the Information Revolution has moved exponentially faster, which brings us to the edge of the precipice in the span of just a few decades.

But, this inconvenient truth also represents an opportunity for us all to heed the lessons -- learned and unlearned -- of the fossil fuel industry and embrace a more renewable future built on a clean data economy.

Where to start?

To run a clean data economy, we must consider the source


Just as we belatedly learned the true costs of burning fossil fuels, we are now waking up to similar negative externalities associated with the unfettered, unregulated use (and misuse) of data.

To rising sea levels, we can now add rising levels of polarization and misinformation in our society. This should not come as a surprise.

The very language of the industry evokes resource extraction. We mine data, run it through pipelines and purposely design goods and services that generate data exhaust.

Once again, the biggest firms control access to the reserves and they exercise their monopoly power to permanently entrench that resource advantage. The leaders that we once celebrated as titans of industry are starting to look more and more like the robber barons of old.

We don’t need any more dead canaries in this coal mine, to continue the metaphor, to signal to us that something is wrong.

The question is: What can we do about it?

Clean data solutions are hiding in plain sight


Our transition to a more renewable, sustainable future based on clean energy sources has proceeded tragically slow. Fortunately, the information economy moves a lot faster than the industrial economy.

We have learned from both the successes and failures of the environmental movement that meaningful progress requires political, technological, and consumer-driven change. When it comes to data, momentum is building on all three fronts.

Let's take a look at each one more closely:

1. Political

Politically speaking, Europe set the standard for cleaning up the data environment with its comprehensive General Data Protection Regulation (GDPR). The American approach has been more piecemeal (CCPA), but as with vehicle fuel efficiency standards, even state-specific regulation can incentivize compliance on a larger scale.

However, truly substantive change will require well-crafted federal legislation that synthesizes the best elements of existing laws, and maybe mixes in some old fashioned trust-busting to boot.

2. Technological

Technology will surely be part of the clean data economy. Just as advancements in wind, solar, and battery technology are essential to reducing our reliance on fossil fuels, we can embrace tools for data and analytics today that are much more efficient, and don’t "pollute."

This is an area that is swarming with innovation. At Habu, we are building data clean room software that enforces strict privacy and governance controls without choking off the engine of data-driven businesses from their fuel source, and we have more exciting clean data products in the pipeline.

Habu emerged from the super{set} venture studio, where several other portfolio companies are building products that will inevitably power the clean data economy in fields ranging from data infrastructure (Ketch), to online content (Spectrum Labs), and HR (Eskalera). Smart companies are already seeing the benefits of this new class of technologies and are making the switch.

3. Consumer-driven

Changing consumer behavior is always the tricky part. We are as addicted to our gas-guzzlers as we are to our news feeds. That’s why the first step is education and raising awareness.

Netflix’s release of The Social Dilemma last fall dominated the virtual water cooler for good reason. And, despite the unique challenges of 2020, we witnessed leaders speaking up and people mobilizing en masse to reject polarization and advocate for truth, justice, and reform.

A movement is taking shape, and the data to make different and better choices is right at our fingertips.

We can heed the lessons of the fossil fuel industry and pivot now to a clean data economy. It will improve the "air quality" in our public sphere and transform data into an even more potent and sustainable fuel source for economic growth. We know the costs of inaction. There’s no time like the present.