What's Up With 'Big Data'?

NEW YORK (TheStreet) -- One of the myths of the last two years in technology is that "big data" is going to allow all these amazingly personalized services for us.

It hasn't happened.

Katie Roof, a journalist, tweeted the other day: "I get random roofing companies following me on Twitter... Roof is really my name..."

When I log in to Facebook ( FB) right now, I am being fed an ad about "Affordable Graphic Design." If I scroll down my entire News Feed in Facebook, I don't see one Sponsored Story.

If I go on to Twitter, I'm getting a Promoted Tweet from SAP North America telling me that "85% of IT managers say current data management systems merely meet expectations or worse, fall short entirely."

I would go on to Groupon ( GRPN) but I've given up after too many emails about mani/pedi offers.

There's obviously something that's not working here with all these companies.

Where's the "big data" that's supposed to learn who we are and show us what we uniquely want?

It turns out that the "big data" you've been told about is the equivalent of adding more bookshelves at the library. All these companies are buying more servers and filling up places like North Carolina and Oregon. They're certainly cataloging all the information you share publicly.

They're just not doing anything with it -- yet.

The "big data" part that most of us know as being rather intelligent and knowing how to find that needle in a haystack, or that piece of information in one paragraph on one page of that book buried in the stacks, is really artificial intelligence or AI.

AI is just getting off the ground. We're really only about one out into the top half of the first inning of the AI game.

Monday night, tech entrepreneur and angel Chris Dixon tweeted: "There are certain areas in tech where you need $100m just to start. Search, maps, most AI, etc. Good for incumbents but not startups."

He's absolutely right.

Apple's ( AAPL) pushing hard in all three. So is Google ( GOOG). So is Microsoft ( MSFT). Maybe Yahoo! ( YHOO) will try also but it doesn't have an extra $100 million lying around.

If Yahoo! doesn't have that kind of scratch, neither does Facebook -- let alone Twitter and the rest of the small fry.

I once talked to a friend of mine who has been working in the now-hot area of speech recognition services for 15 years about how he views a service like Siri and whether it could one day retrain all of us to ask a personal assistant for information instead of typing in a query into a search box.

He thought it was definitely possible but he said something very interesting to me about how they are going about that goal.

"Google has a lot of really amazing speech rec people working for them. In fact, they're much better than the speech rec people employed at Apple, in my view," he said. "But Apple is amazing in AI. They're way ahead of Google in AI."

Apple's obviously making a big bet on AI. Is it working?

Most have written off Siri. "It doesn't work," they say. The version 2 is better but not enough to knock people's socks off.

However, as with the new Maps service, Apple's collecting tons of data every day from Siri and Maps. It's then throwing its AI at those data full force -- finding the relationships that will form the basis for real intelligence down the line.

The promise of "big data" will be realized, but it's going to happen through AI, with lots of money and lots of time.

At the time of publication the author had positions in YHOO and GOOG.

This article was written by an independent contributor, separate from TheStreet's regular news coverage.

Eric Jackson is founder and Managing Member of Ironfire Capital and the general partner and investment manager of Ironfire Capital US Fund LP and Ironfire Capital International Fund, Ltd. In January 2007, Jackson started the world's first Internet-based campaign to increase shareholder value at Yahoo!, leading to a change in CEOs in 2007. He also spoke out in favor of Yahoo!'s accepting Microsoft's buyout offer in 2008. Global Proxy Watch named Jackson as one of its 10 "Stars" who positively influenced international corporate governance and shareowner value in 2007.

Prior to founding Ironfire Capital, Jackson was President and CEO of Jackson Leadership Systems, Inc., a leadership, strategy, and governance consulting firm. He completed his Ph.D. in the Management Department at the Columbia University Graduate School of Business in New York, with a specialization in Strategic Management and Corporate Governance, and holds a B.A. from McGill University.

He was previously Vice President of Strategy and Business Development at VoiceGenie Technologies, a software firm now owned by Alcatel-Lucent. In 2004, Jackson founded the Young Patrons' Circle at the Royal Ontario Museum in Toronto, which is now the second-largest social and philanthropic group of its kind in North America, raising $500,000 annually for the museum. You can follow Jackson on Twitter at www.twitter.com/ericjackson or @ericjackson.

You can contact Eric by emailing him at eric.jackson@thestreet.com.

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