As one of three credit bureaus in the United States, Equifax keeps financial data on every adult in America, plus people in 16 other countries. But the company knows much more than just what goes into an old-fashioned credit score.
It maintains information about people who share the same phone number or address, "non-obvious" relationships between individuals, loans for dental work, magazine subscriptions, rental history, real estate assets, investment wealth, retail purchasing, the type of federal tax return someone files, marital status, employment, utility payments, cable TV accounts, criminal records, debt-to-income ratios, changes of address, motor vehicle files, post office boxes, inferences about someone's capacity to pay bills, predictions about someone's propensity to pay, links to past and potential fraud crimes--and more.
This pile of more than 800 billion records is sliced, diced, analyzed and indexed into 26 petabytes of data. That's more data than the FBI's Investigative Data Warehouse, said to be the single biggest repository at the agency, with its relatively measly 1 billion unique documents. In all, Equifax has data on 500 million consumers and 81 million businesses worldwide.
Says Equifax CIO Dave Webb: "We know more about you than you would care for us to know."
In his wry British way, Webb alludes to the power of information and his push to derive ever more lucrative products and services from Equifax's vast stores of it. Webb says Equifax can make money off IT innovation--that is, his staff's ability to manipulate massive amounts of data better and faster than competitors can.
The company has launched scores of new IT-based products in the past few years, chasing two ideas: cutting risk and improving marketing for its 46,000 business customers. Equifax can, among other things, check an immigrant's employment status, verify a doctor's credentials, assess an Internet user's social influence and monitor a child's budding credit portfolio. Big data. Big Brother. Big bucks.
But like other companies in various industries hoping to spin in-house data into revenue, Equifax has to maneuver through tricky economic, political and cultural changes. The recession forces businesses to seek out reliable data on which to base decisions (opportunity), but they have less money to spend (problem). Congress enacted tough regulations to try to control mortgage companies (opportunity), while President Obama's new Consumer Financial Protection Bureau says it's going to monitor credit bureaus (problem). People are freer with personal data than ever before (opportunity), but they don't like it when companies get too personal (problem).
Rivals Experian and TransUnion also are remaking themselves into analytics companies. "Decision analytics is the growth engine for these companies," says Elizabeth Mason, an analyst at Outsell, a company that studies the information industry. "Yet it's a shifting landscape. We don't know yet what the public's tolerance is for companies mining all of this data really well."
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