The true value of information
Posted on Jan 4, 2019
As an information technology professional I’ve many times wondered what is the true value of information. It is obvious that there is more and more information available every day: One humble estimation already from 2011 stated that humankind exceeded around 300 billion gigabytes. That figure has of course multiplied since then. Less humble estimations say that humankind’s knowledge could soon double every 12 hours.
Let’s try to keep the differences between data, information and knowledge in mind before stepping too far, although they are all connected when thinking about information’s value. Articles in Wikipedia are more detailed than ever, enterprises are implementing massive data warehouses for data mining and amount of top quality scientific publications is steadily increasing. Our understanding of the available resources and universe is getting better and better. But how valuable is the information that we possess?
It’s still quite easy to think that natural resources - such as oil, metals, wood and other raw materials - have the well defined measurable market price, while information is something more abstract and therefore not possible to measure. This is partly true, but on the other hand abstract doesn’t mean that it’s less valuable. “Value of Information" has some space in economic theories, although nothing too practical.
In global economy we have already seen the hegemony of natural resources driven companies, such as Exxon Mobil and U.S. Steel, shifting towards information driven companies, such as Google and Apple. Transition can be seen for example from the comparison of Fortune 500 companies in 1950 vs. 2015. Information driven companies keep on growing while natural resources based companies are trying to add more value into their old products (with new information of course), innovating new production mechanisms or simply searching for new business opportunities.
There’s a very simple reason for this: The more we have information about natural resources and raw materials, the more richly and effectively we can utilise them. Therefore raw materials' value and production are in a constant turbulence. One day we generously burn endless amounts of petrol produced from the oil wells to get our energy - next day we burn petrol produced from the oil sands, fortunately in significantly more energy efficient combustion engines. Information changes the oil’s demand and few decades later we shift from oil to completely new energy sources, such as Advanced Small Modular Reactors (nuclear power).
The more information we have, the more resources the world provides to us. This enables infinite economic growth even on the finite planet Earth.
Let’s think theoretically. If humankind faces a natural disaster - let’s say a super volcano is about to explode or a large asteroid is heading towards the Earth - which scenario would be better for our survival after the impact: 99% of raw materials would be still available for us, but only 1% of current information is saved. Or only 1% of raw materials would be available but 99% of information could be kept in a planetary safe deposit box (something like Svalbard Global Seed Vaultfor information)?
The first scenario would throw us to the Stone Age and recovering back to the current level of living standards and science would take tens of thousands of years (as it took from simple agriculture to industrial and information era). We would have resources but we wouldn’t know what to do with them. Nothing guarantees that we are able to make any significant innovations within that time.
But if we store the information and teaching methods for a rainy day we would be able to harvest the remaining 1% of raw materials highly effectively and soon find many new resources with ever-growing information. This sounds much more potential.
Therefore it is safe to say that the true value of information is much more than any raw material that we can find from our world. For us the true value of information is unmeasurably high and it keeps on growing.