ANALYSIS & OPINION

Britain pledges £42 million for big data

24 March 2014



In the first of two articles on big data, Robert Roe considers the implications of the British Government's announcement of £42 million over 5 years for a new Alan Turing Institute for data science.

The British Government is to spend £42 million over the next five years to create an ‘Alan Turing Institute for data science’, the British Chancellor of the Exchequer, George Osborne, announced in his 2014 Budget statement.

The institute is intended to make the UK a ‘world leader in the analysis and application of big data’ according to a statement by the UK Department for Business, Innovation and Skills. It continued: ‘Once operational, this will be a world-leading institute, attracting the best talent and investment from across the globe. It will provide a fitting memorial to Alan Turing.’

The independent economic forecasting organisation, the Centre for Economics and Business Research, has estimated that the market for big data could benefit the UK economy by £216 billion and create 58,000 new jobs in the UK before 2017. Deloitte recently completed similar research, estimating that public sector information alone is worth around £1.8 billion a year to the UK economy, with wider social and economic benefits bringing this up to around £6.8 billion.

Research by the UK’s National Endowment for Science, Technology and the Arts (Nesta) also shows that UK data-driven firms are 40 per cent more likely to report launching products and services ahead of competitors who do not take advantage of big data.

The new institute will collaborate with other e-infrastructure and big-data investments across the UK research base including the Open Data Institute, Catapult Network, the new ARCHER supercomputer centre at Edinburgh University, and the Hartree supercomputing centre at Daresbury in the English Midlands.

The UK’s Universities and Science Minister, David Willetts said: ‘Creating a world-class institute dedicated to data science will secure the UK’s place as a global leader in this field, and bring significant future benefits to the UK’s economy and society.’

However, behind the political hype, details on how and where the institute will be set up remain sketchy. According to newspaper reports, it could be housed at a new location or an existing University but the tender for the location will not take place until later this year.

Nor is it clear whether the money announced by the UK Government will be adequate to achieve its stated aims. A report published in 2013 by the US consultancy company Wintercorp, which specialises in analysing technological issues around data management and big data, found that the costs of a big data facility can vary enormously. Wintercorp estimated the costs of a data warehouse and also of a Hadoop cluster which is often seen as a low cost alternative to a data warehouse. Their lowest-priced example was for a Hadoop cluster with 500TB of stored data for rapid, intensive processing of a small number of closely-related datasets. The system was priced at around $9.5 million dollars.

At the other end of the scale, a Hadoop cluster used to analyse data at a large financial institution was valued at around $740 million (the data warehouse equivalent was found to be $265 million). At its most generous then, the UK Government’s spending plans for a national facility appear to be about a quarter of what the financial services industry is already willing to pay.

Nonetheless, the consultancy firm KPMG welcomed the announcement. Alwin Magimay, UK head of digital and analytics at KPMG, said: 'Data scientists are what computer programmers were to the UK economy in the nineties. We as a nation need to industrialise this discipline to ensure that British business can prosper from understanding the potential of the data and turn it into a competitive business advantage. The investment of £42 million is a powerful signal to businesses, academic institutions and investors to sit up and realise that big data isn’t just a term coined by the technology world, but that it presents a real opportunity for UK business to gain value from the abundance of data being created in a digital and connected world.'

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