During the budget statement today, Chancellor Jeremy Hunt is announced a new £2.5bn national quantum computing programme. The decade-long project is aimed at keeping the UK competitive in an area of technology expected to dominate over the next 20 years. One investor told Tech Monitor the government also needs to steer private capital towards growth sectors such as quantum computing.
The “Plan for Quantum” will make money available to researchers in both industry and academia with the new National Quantum Computing Centre, currently under development in Oxfordshire, set to play a leading role. It expands on the existing National Quantum Technologies Programme, more than doubling the existing budget and will come in the Budget as part of a wider pledge to turn the UK into the next Silicon Valley.
First reported by the FT, the programme will also see funding spread around the country through a “future network of research hubs” although the Budget isn’t binding on any future government. While China and the EU spend the most on quantum computing at a national level, large US tech companies are investing billions with IBM on a path to reveal a 1,000-plus qubit machine next year.
This new programme puts the UK in the top three countries in terms of national-level investment in quantum computing, behind China and the EU but that doesn’t include investment from companies such as IBM, Google, Microsoft and others nor the venture capital funding going into start-ups like IQM and Oxford Ionics.
Despite spending less at a national level than the EU, the UK is ahead in terms of the number of quantum computing start-ups. There are 39 quantum tech start-ups in the UK, many of which have formed out of university projects and this is the most of any single country within Europe. Germany follows with 18 with France and the Netherlands each boasting 15 according to research from Sifted.
Despite being at an early development stage without the logical qubits to reach quantum advantage, it is estimated the market for quantum computing could be worth at least $4.5bn by 2030 with a CAGR of 28.2% and a report by the Boston Consulting Group suggests productivity gains from utilising the power of quantum computing could lead to incremental operating income of up to $850bn annually by 2050.
Quantum computing: need for private capital investment
Ekaterina Almasque, general partner at OpenOcean, a venture capital company that invests in deep tech like quantum computing, and a board member of Finnish quantum start-up IQM told Tech Monitor that this level of investment was a “welcome boost” to the ecosystem. “Quantum remains a thriving area of UK tech, with surging interest from investors and industry partners in backing its continued development. This pledge represents a commitment to maintaining the growth of the UK quantum sector – full of category leaders in centres of excellence like London, Oxford and Cambridge.”
She added that the investment in the plan is a good step in “aiming to keep talented founders and scientists in this country, instead of being forced to relocate the firm to be able to raise the capital from abroad”. However, she said “we still need greater action from governments to steer private capital towards growth sectors such as quantum computing.
“This £2.5bn package is significant, but it will be spread thin across ten years and all of the many innovative companies in this sector. By encouraging investment from private institutions like pension funds, the government can do more for the quantum sector than it ever could alone.”