Will The Big Data Bubble Burst In 2013?

By Bill Franks, Dec 12, 2012

I am going to go out on a limb, put a prediction in writing, and hope that I’m not eating serious humble pie in 12 months!  I predict that in 2013, the big data bubble will begin to spring some serious leaks. The bubble may not fully burst in the next 12 months, but it will begin to deflate. However, I think this is actually a good thing and will help enable big data to have the impact it is capable of having in the future. This may sound counter-intuitive but if you stick with me, I hope you’ll see where I am coming from and agree with me.

Recent reports show that big data is near the peak of the hype cycle with a substantial fall coming. I had a journalist call to ask me what I thought. “Is big data really heading for a big fall?” he asked.  I told him that the answer is both “yes” and “no” and then proceeded to give my viewpoint. I’ve shared those thoughts below.

When people think about a bubble bursting or a hype cycle reaching a peak, they sometimes interpret that to mean that the underlying premises were all wrong. In other words, if a bubble bursts, then the whole concept was junk to begin with. In most cases, this isn’t really true.  While the Internet bubble of the late 1990’s certainly caused some carnage, the fact is that the Internet has probably had more impact than most of us expected even at the peak of the bubble. The bubble wasn’t as much about the Internet itself being overhyped as it was about people throwing money at anything and everything that could attach the word “Internet” to its mission. The Internet was too hot and too important for anybody to risk missing the party. As a result, many ended up with a huge hangover.

I believe that we are at a similar point with big data. Right now, anything that purports to touch big data can get a lot of attention. Organizations are sometimes irrationally pursuing big data just because they think they have to. Worse, many organizations think that there are magic tools out there that will “solve” big data for them. As I discussed in a prior blog, there is no easy button for big data. While big data can (and will!) drive major change in the coming years, the fact is that every type of big data won’t drive change for every organization. Each organization will have to find its own path to success given its own unique business model and relevant big data sources.

Let’s go back to the question. Will the big data bubble burst?  I say yes, to the extent that people will start to realize that big data isn’t a magical cure-all that is easy to drive value with. Rather, it is a pool of information full of potential that can only be extracted with a concerted, focused, and intelligent effort. Just as a vast oil reserve can’t be magically tapped, neither can big data. It will be a positive thing when unrealistic expectations are put to rest. This aspect of dropping past the peak of the hype cycle or having the bubble burst is a good thing.

Let’s go back to the question again. Will the big data bubble burst?  I say no, to the extent that such a statement implies that big data will be seen in the future as having been a huge, valueless boondoggle. Big data is real and it will have real impacts. The analytics it enables will change our lives. From that perspective, the bubble won’t burst at all. That is also a good thing.

By having the bubble burst under the preceding terms, we’ll be in a better place. The more realistic organizations are about the scope and expectations of their big data initiatives, the better the chances for success. A bit of a bubble burst will be a good thing as we get people beyond the initial excitement and hype and into the mode of actually putting big data to work.

I actually look forward to the migration of big data through the hype and into a post-bubble era. It is what will enable cooler heads to prevail and real success to occur. Don’t fear it, don’t fight it. Simply view it as a necessary step in big data’s maturation process. The recent hype has helped get big data on the map and was a necessary step in its evolution. So, too will be the passing of the hype phase. It will allow big data to become what it is capable of becoming.

About the author

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Bill Franks is Chief Analytics Officer for Teradata, providing insight on trends in the analytics & big data space and helping clients understand how Teradata and its analytic partners can support their efforts. In this role, Bill also works to help determine the right strategies and positioning for Teradata in the areas of analytics & big data.Bill is the author of the book Taming The Big Data Tidal Wave (John Wiley & Sons, Inc., April, 2012). In the book, he applies his two decades of experience working with clients on large-scale analytics initiatives to outline what it takes to succeed in today’s world of big data and analytics. Franks’ second book The Analytics Revolution is coming from Wiley in Fall 2014.Bill is also a faculty member of the International Institute for Analytics, which was founded by leading analytics expert Tom Davenport. Last, Bill is an active speaker and blogger. Bill’s focus has always been to help translate complex analytics into terms that business users can understand and to then help an organization implement the results effectively within their processes. His work has spanned clients in a variety of industries for companies ranging in size from Fortune 100 companies to small non-profit organizations.Bill earned a Bachelor’s degree in Applied Statistics from Virginia Tech and a Master’s degree in Applied Statistics from North Carolina State University. You can learn more about Bill at