The UK government is jeopardizing its own ambitions to become a tech superpower by neglecting the long-term implications of storing so much public sector data with US tech firms, according to former UKCloud chairman Jeff Thomas.
While other governments are building in-country, cloud-based data capabilities for privacy, compliance, and commercial reasons, the UK public sector is freely handing its data over to the US tech giants.
Ofcom’s October 2023 Cloud services market study states that US-based Amazon Web Services (AWS) and Microsoft are the two leading providers of cloud infrastructure services in the UK with a combined market share of 70-80%.
According to serial tech entrepreneur and investor Thomas, this dominance could have lasting negative effects on the UK’s long-term economic prospects.
“Data is becoming much more important – strategically and economically. How we govern and manage it, how we harvest it and exploit it responsibly for the population is really important, but when you look at what other governments are doing, they all have a sovereign posture towards data that is in the national interest – and we don’t,” he says.
More and more of the UK’s data is migrating to the clouds of US-based technology firms, who can use it for their own commercial gain.
“And why are they gathering all this data? One reason is that they need this ‘gravity’ of data, these payloads of data, to train artificial intelligence (AI), large language models, and the like. That is what the UK is missing out on – we do not have that gravity of data because so much of the storage and processing of our data is being outsourced to US hyperscalers and technology firms,” he adds.
“My question to any member of our government on this would be: when was the last time a British company was awarded a contract from an American government agency to look after their sovereign data? It doesn’t happen.”
Falling behind
It’s a situation that puts the UK at risk of falling behind other nations in the AI arms race, while the US cloud giants continue to grow their market share – at the expense of the UK’s domestic providers, Thomas warns.
“What we’re witnessing here is the demise of an industrial sector in the UK, and we’ve seen many sectors disappear over the years because most of them have had their time, and – regrettably – it looks like the same is about to happen to the cloud industry, and this industry only just in its infancy, not its twilight years. The global cloud market is expected to grow at above 15% CAGR to 2030.”
He adds: “The UK had a perfectly good cloud industry but the landscape has changed – and that means we’re getting less investment into the UK tech sector as a whole,