Are we ready for a true data disaster?

A catastrophic leak at a major data-gathering organization could have an impact as profound as any oil spill

Imagine you're head of a company whose stock in trade is mining one of the world's most valuable resources. You've just struck a rich new cache. The potential for profit is huge. Then, all of a sudden, disaster strikes. Maybe your equipment failed. Maybe your technology had some unforeseen flaw. Maybe it was human error. Whatever the cause, in an instant that promising new profit center has become a liability, and what was once a valuable commodity has become a dangerous contaminant, gushing out of your control at an alarming rate. The collateral damage will be huge, and the effects of the leak will linger for years to come.

It's a nightmare scenario to keep oil executives up at night, particularly in the wake of the April 20 explosion at BP's Deepwater Horizon platform in the Gulf of Mexico. BP has yet to gain control of that underwater gusher, and the eventual cost -- in terms both economic and environmental -- is incalculable.

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But oil isn't the only industry whose execs should be losing sleep. We refer to modern American society as an "information economy," and rightly so. Google has built a fortune harvesting "the world's information," and competitors -- including Facebook, MySpace, and Microsoft -- all seek to do the same. Increasingly there is value in data, and the digital revolution has made it possible to amass vast data sets like no other time in history.

Yet data, like oil, is dangerous. Even seemingly benign applications of data mining can have broad implications for personal privacy. Should the owners of these new data stores lose control of their assets, in the wrong hands they could have profound impact on the economy and society at large. Unfortunately, the lure of potential profits in the information economy, combined with the apparent ease with which data can be gathered and a lack of regulation, creates a climate of recklessness in which a "data spill" of the scale of the Deepwater Horizon incident seems not just likely, but inevitable.

There will be bits
In the weeks since news of BP's oil catastrophe developed, both Facebook and Google have come under fire for their data management practices. Facebook faces a lawsuit filed by the Electronic Privacy Information Center (EPIC) and 14 other consumer protection groups that alleges that the company's ever-shifting privacy policies violate user expectations and may constitute deceptive trade practices. Google, on the other hand, was called to task for snooping packets from unsecured Wi-Fi networks as its Google Street View mapping trucks rolled through neighborhoods; it now also faces a class-action lawsuit.

In a sense, each of these incidents is the opposite of a data leak. They're more the digital equivalent of slant drilling, in which overambitious companies grab more than they're entitled to. Google's meek apology was that it had been unaware of the extent of its wireless data-gathering and that none of the data was used in Google products. But whether or not Google's ignorance of its actions and their potential consequences is feigned, it is still evidence that today's information-gathering behemoths may not have such tight control over their data stockpiles as they'd like us to believe.

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