Nowcasting is a term used by the folks at Google to represent an analysis of large volumes of data that can be used to "forecast" current events for which official analysis has not been released. For instance, using these techniques one can "nowcast" what the current unemployment rate is before the official unemployment rate is determined. Google also calls this "predicting the present."
Another example is the way Google was able to pinpoint the emergence of flu outbreaks by monitoring outbreaks of search terms for flu-related words, as a proxy for the flu itself. As they put it: "web searches may not only be useful as a reliable indicator of the health-seeking behavior when facing the influenza pandemic but also they may contain a useful information for predicting the present stance of economic activity some time ahead of the official release of relevant data."
How predictable is the present using these algorithms? Here is one example (from the paper above) of Google's nowcasting of private consumption growth rates compared to actual rates over a three year period. Googles nowcast is gray; the actual black.
But as this paper, Google Trends Predictability, points out, the accuracy of predictability depends.
• Over half of the most popular Google search queries were found predictable in 12 month ahead forecast, with a mean absolute prediction error of approximately 12% on average.
• Nearly half of the most popular queries are not predictable, with respect to the prediction model and evaluation framework that we have used.
• Some categories have particularly high fraction of predictable queries; for instance, Health (74%), Food & Drink (67%) and Travel (65%).
• Some categories have particularly low fraction of predictable queries; for instance, Entertainment (35%) and Social Networks & Online Communities (27%).
I'll be bold and suggest that areas where fashion dominate (entertainment and social) prediction is less accurate.
Real time "prediction" of events which can only be measured accurately later will become the norm as our society and lives are ever more quantified. Nowcasting is a way of modeling an estimate in real time, or just a bit before real time, if a precursor signal can be found, such as searching for flu symptoms before you break out with it.
Nowcasting is also what Google Instant does when it loads the pages it think you want before you have even finished typing in your query. It is predicting the present.