Big Data and Agriculture, From bytes to crops and conversely ∗
BY Stephane Grumbach, INRIA
22 July 2015
The corporations handling big data which have the biggest impact, both economically and socially, are those which combine big data often freely available together with data provided — either actively or even not intendedly through the traces of their activity on the corporation’s platform — by their users. This constitutes a radical change of paradigm with profound consequences on our society.
Activity traces have indeed given rise to extremely valuable services, which can either contribute to improve initial services through personalisation, or lead to the development of completely new services, which at first glance might appear very distant from the original services. What the combination of global data with users data has changed irreversibly in our industries is the level of granularity, both spatial and temporal, of the available information.
The search engine is a good example of such a phenomenon. Traces of users allow to refine queries by personalisation.
But they also allow to generate knowledge not only on users profiles, but as well on populations, which can lead to new services with potential added value for actors in an unbounded number of sectors.
As for numerous platforms, the business model of the search engine doesn’t rely on its initial service, which is accessible for free, but on a service derived from the traces, allowing efficient targeting of ads to relevant users. By doing so the search engine not only revolutionised our access to knowledge, but as well seamlessly as a side effect the advertisement industry.
These corporations, which combine global data with users data, are actually revolutionising all multi-sided markets.
Their impact is well recognised. They enjoy enthusiastic support from venture capitalists, as well as extremely fast growth of their capitalisation — Uber weights a quarter of IBM, and three of these corporations are among the Top 5 capitalisations worldwide, competing with the long standing oil industry and banking sector.
Their social impact hits now the headlines, for their severe disruption of various traditional economic sectors, raising popular discontent as well as political and judiciary hostile reactions. The creation or the release of data, not accessible before, changes the subtle equilibria between actors in the society. It allows the emergence of new sorts of powerful intermediaries, which offer services at a global scale, potentially without interactions with the products or services exchanged, as well as little reliance on local legal constraints. As a result, it empowers some, in particular downwards, the users, and upwards, global intermediation platforms themselves, while it might destroy others, in particular traditional intermediaries with local activity.
Is agriculture going to be spared from the revolution of global intermediation which profoundly transforms the world?
Would it be desirable to protect sectors such as agriculture from these mutations, or on the contrary might global intermediation eventually contribute solutions to global challenges?
Agriculture is a story of people and land, therefore local. But it is also severely determined by regulations, trade agreements, market conditions, and increasingly by climatic threats, therefore extremely global as well. Moreover, although it employs a declining part of the population, almost negligible in rich economies, there is no economic sector of greater importance to fulfil our basic needs, and its products reach daily every single person. Could its present organisation be radically changed by intermediation platforms, much the same way it is happening in other economic sectors, such as transportation, the press, or education to name a few?
We claim that this revolution will take place in agriculture because on one hand it is made possible by technology — connectivity and data analytics — but also, and may be even more importantly, because it might contribute to better face the deepening challenges of feeding the planet.
Anyway, things started already, and it is no surprise. A company has emerged which is reshaping the landscape, The Climate Corporation. Founded in 2006 to provide better meteorological information to industries strongly depending upon weather conditions, it rapidly specialised in agriculture, where the challenges are of increasing importance under the pressure of global warming and more chaotic climatic conditions.
The Climate Corporation assimilates meteorological data from the main agencies and uses predictive models to provide services to its customers, through a downstream data flow. It also collects, through an upstream data flow, data produced by sensors installed at its customers location, which allow for better services combining global and local data. Its services address short term issues such as watering and pests, as well as long term issues such as choices of crops.
In a recent press release, The Climate Corporation announced that ”farmers have mapped more than 75 million row crop acres in their digital agriculture platform, up from 50 million acres in 2014. This significant acre adoption represents nearly 45 percent of all corn and soybean acres planted in the U.S.” Therefore an already rather dominant position in that country. The corporation was acquired by Monsanto for around 1 billion US$ in 2013, raising discussions and controversies in the U.S.
As for digital platforms in other sectors, new services can be created on business sides which can be embarked later to the model, using the original data produced by the initial services. The Climate Corporation is no exception. It offers now insurance services for farmers, which are supported by the U.S. Department of Agriculture. Its knowledge renders verification of damages useless, thus revolutionising the insurance business with increased efficiency both for the insurance company itself and its beneficiaries, who can thus be rapidly compensated.
As a global intermediary, such a company can create new services on more sides of the multi-sided market of agriculture, which on one hand will simplify the life of actors, starting by farmers, while on the other hand will put aside traditional intermediaries. All the economic and social interactions of farmers both upstream with their providers, machinery, chemicals, seed companies, sanitary and regulatory bodies, etc., and downstream, with the food industry, agricultural research, etc., could be handled by the platform, thus determining their partnerships at a global scale.
Once they become global, intermediation platforms in the agricultural sector will most probably conflict with local policies and actors, on the strategic choices of the territories designed at national levels, as is the case in other activity sectors such as urban transporta- tion for instance. Moreover, corporations which are not pure intermediary players but have activities on some of the market sides, might have conflicts of interest and fall under antitrust regulations.
But on the other hand, there might be an alternative vision, with large intermediation platforms contributing to implement better rules for this industry at a global scale, with the capacity to impose or at least widely promote behaviours and practices more accountable to the environment, thus helping face the global resource challenge of the millennium.
∗Abstract adapted from a Public Hearing in the French Parliament, July 2, 2015. Thanks to Olivier Hamant for comments on a previous draft of this note.