The monetization of data, a new economy.

Updated: May 12


The monetization of data, a new economy.

Many of us were aware of the congressional testimony of Mark Zuckerberg, it is best you do your research but long story short, Facebook got caught selling personal data. Everything has a price. I don't believe the saying "there is no free lunch", but in this case, we would be very gullible to think using social media is genuinely free. Imagine a friend let you use their car and after you were done he charged you the amount of petrol you used. What did we expect? Back to quantum, data has become essential.

The monetization of data, a new economy.

The monetization of data


Let's say a website has facebook pixels embedded within it, say a massage website. Now, after you visit your Facebook account to see massage adverts, coincidence? As much as this may surprise you, there is no one spying at you through your phone or laptop camera, it is your Facebook login, and this allows any embedded Facebook pixel on any website to pick up your visit. This pixel feeds the Facebook data, and the algorithm determines your interest in getting a massage and delivers other options to you, albeit paid advertised options.


Trust us when we say this, current supercomputers within spy agencies cannot keep up with the abysmal amount of data they collect daily and are getting backlogged every minute of every day. But data is like oil. It needs to be refined and processed. And unlike oil, it is more like alchemy. In the right hands, the information is golden.

The monetization of data, a new economy.

A new economy


Lastly, in my view, this has given rise to a new type of cybercrime — data collection. Hackers, as of 2018, have gained almost 2 billion user data from various places. Many speculate as to where these data have ended up. And considering how important these data, placed in the hands of a proper analyst looking at the correct data points, can churn out almost anything. Hackers realize that data is money. They don't need to hack banks anymore and stand to make millions of dollars selling data for cryptocurrencies.


Bringing the topic back to how data benefits the legal businesses, one must understand why Snapchat valuation in the billions and rumours that Facebook attempted to buy it's for 3 billion US dollars. So how does that make sense in terms of investment? Snapchat has a stronghold on the data and behavior of teenagers. Which means every aspect of their life like where they are going, doing, love, hate and trending at the moment — information which optimizes the targeting of ads and campaigns. Now imagine if Facebook had access to all these data points and figure out how to properly extract and use these data points. They would be able to find the correct product and target them to the people most interested in buying them. Teens may no longer have to google, a person who is a fan of the Marvel movie franchise and collects Hulk figurines can target for products such as t-shirts and collectables. A teen suffering from acne can target to pimple creams. A teen who loves skateboarding can target to subscribe to the latest X games Livestream.

Data points are discrete units of information. A kind of consolidation of a particular type of information gathered. Depending on how you set your data collection and the algorithm used to collate this information, data points can be a powerful tool. Companies like Facebook, Google and LinkedIn use data points to target ads to the audience most likely to respond to them. It is no longer good enough to spew ads on webpages hoping it lands on the right target audience. When you can predict the behaviour and interests of specific individuals, we know they are more responsive to their interests. A person who is interested in AI and robots more susceptible to videos by Boston Dynamics. And when a user clicks on such videos, it further confirms the data points accuracy allowing them to target relevant ads to the user. And when a user clicks on the ad, it is pay per click. It is becoming more evident as to how valuable data truly is, in the right hands, of course.


Facebook purchased Instagram itself for 1 billion US dollars in 2012. Many thought this was a crazy move from Facebook. But the numbers do not lie, ever since 2012 when the annual revenue was around five billion dollars, Facebook's revenue for 2018 has grown eleven times to over fifty-five billion US dollars. They knew something that we did not and made a significant investment in purchasing Instagram, among many other investments. They have done what MySpace and Friendster failed to do, monetize social media effectively by merely looking at how they can target their ads better than everyone else. And till this day, they are still leading ahead of Google in ad revenue and their targeting algorithm.

Thank you for reading 'The monetization of data, a new economy.' and we hope you have a beautiful day.

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