Weather information is big business
If you are like me, and millions of other Americans, one of the first things you do after waking up, and maybe after checking your work email, is to look at the weather report.
“It is so essential to our daily life,” said Molly Macauley, vice president for research at Resources for the Future, a think tank focused on environmental and natural resource policy in Washington, D.C. “I often show people the front page of the newspaper, above the fold. The weather information is there every day, on that very, very valuable above-the-fold real estate.”
While you and I are eating our oatmeal and trying to decide whether we should bring an umbrella or just a light sweater to work, companies around the world use the same data to make critical investment decisions.
“Can the bridge withstand a certain type of freeze-thaw cycle that stresses out our building materials?” she said. “Trucking industry needs to know, ‘Do I need to use tarps today or not?’”
Drug companies want to know what the pollen count will be like in the spring; airlines, what kinds of weather fronts a plane must fly through and what conditions will be like when and where it lands. Weather data is free from the National Weather Service, but Macauley notes there are middlemen for specific industries like aviation.
“What’s the weather the plane is going to fly through, and what’s the weather on landing in Paris? To put all that together — that’s a very complicated set of measurements,” she said.
And that may be why IBM is reportedly close to buying the data and digital assets that power Weather.com. The value of weather data can go up to the billions, said Chris Hyde, director of weather marketing and a meteorologist with MDA Weather Services, a consulting firm.
Just one utility company, said Hyde, could pay thousands of dollars a month for hourly weather reports. Imagine it’s summer, and your utility company needs to provide enough power to run all the air conditioners in a small city.
“If you’re off by a certain hour, that costs them money as far as accuracy goes.”
More and more companies are using this information,” said Dave Jones, founder and CEO of StormCenter Communications. The company created GeoCollaborate, a new technology that allows for real-time sharing of data, such as weather and emergency information, across multiple platforms.
“People who are being impacted by extreme weather and climate change are all the sudden finding out that they can use weather information strategically to plan where they want to build their next plants, where they might want to ship their products and where they may even want to relocate.”
In the future, said Jones, weather will become an even more valuable data point.
“Weather will be used as a decision-making tool,” he said, instead of “just something to complain about.”
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