Europe’s Playbook, Britain’s Opportunity 

By Tesh Durvasula, CEO, AtlasEdge Data Centres

As the Labour Party marks its first year in government, it also happens to be a year since I moved to London to lead AtlasEdge. The coincidence has given me cause to reflect – not just on the UK’s digital momentum, but also on how its ambitions compare with what I’ve experienced working across Europe.

The Prime Minister’s announcement at London Tech Week last month that an additional £1 billion of funding will be made available to scale up the UK’s compute power was the latest in a long line of welcome signals of intent from this Government that it sees the value and potential of the digital economy.

The UK’s recent Industrial Strategy, with its recognition of digital and technologies as a key growth sector, went even further – setting in motion a framework which, if delivered, could place the UK firmly at the forefront of the next stage of the digital revolution. The commitment to address historic under-investment in grid infrastructure is particularly welcome, with some companies waiting up to 15 years to be connected. ¹ Such long lead times are a significant bottleneck stifling the UK’s data centre sector.

And the UK is not starting from scratch. It is only the third country in the world (alongside the US and China) to have a tech ecosystem valued at over $1 trillion, built on the back of world-leading research and strong culture of innovation. From the codebreakers at Bletchley Park to the 2023 AI Safety Summit, the UK has long played a high-profile role in advancing computing and setting the tone for responsible innovation.

But more must be done if the UK’s ambition is to become reality.

Lessons from Europe

Much can be learned from Europe, and two countries in particular.

Portugal, where we will be investing more than €500 million over the next few years, is a booming data centre market supported by some major tailwinds. The country benefits from being uniquely placed along key submarine cable routes that are essential for global digital connectivity, as well as an abundance of renewable energy. But it has capitalised on these natural advantages by delivering a supportive business environment, underpinned by a relentless focus on delivering the talent required to drive domestic data centre development – not least via a curriculum designed around STEM subjects from an early age.²

Meanwhile, Germany – another of our target markets where we are putting in similar investment – has signalled its ambition with its landmark €500 billion infrastructure investment. Germany has long had the fundamentals: a highly skilled workforce, robust infrastructure, and a deep-rooted industrial base. But such a long-term fiscal commitment, delivered with discipline and underpinned by private sector partnership, sends a clear signal to industry that a market is going to support the long-term capital cycle required for significant infrastructure investments.

This blend of long-term vision and practical delivery is exactly why Iberia and the DACH region sit at the heart of our future growth plans.

Opportunities ready to be grasped

So what does that mean for the UK?

For a start, it already has the foundations required for success. Despite recent challenges, the UK continues to be a leading financial centre. London alone is responsible for $3.8 trillion in forex transactions a day³, more than the next three largest centres – New York, Singapore, and Hong Kong – combined. The access to capital that London provides, alongside the potential of the UK’s industrial heartlands, makes the UK the ideal environment for businesses to expand, innovate, and thrive.

Equally important is the UK’s world-class further education system. From globally renowned universities to top-tier technical colleges and apprenticeships, the UK is perfectly poised to produce the highly skilled workforce needed for a thriving digital economy.

But much more is possible.

While the UK’s data centre supply is already growing at a healthy 10%, analysis by techUK has found that increasing this by just 5% could unlock £44bn in additional gross value added between 2025-35, creating over 40,000 additional jobs and delivering £9.7bn in additional tax revenue over the period.⁴ Such figures could have a transformative impact on the UK’s economy.

There are also wider strategic implications. At the recent NATO summit, member countries – including the UK – committed to spending 5% of GDP on defence-related innovation. That level of investment will inevitably mean significant spend on the digital infrastructure that supports modern military capability, from hardware to AI to secure cloud.

The good news is that things are going in the right direction.

As mentioned, the Government’s plans to reform access to the grid are well overdue. Data centres require a large amount of energy, so securing timely and affordable access to clean energy is key if the sector is to grow and thrive. In turn, updates to the National Planning Policy Framework last year to make reference to data centres, combined with proposals to designate them as Nationally Significant Infrastructure Projects, represents an enormous and positive shift in the policy environment around the sector; one which has the potential to deliver real change.

This progress matters not just economically, but socially. I’ve long believed that data brings us together – and that the acceleration of digital infrastructure, AI and advanced technology can be a powerful force for good in society. It’s what underpins how we live, work, and connect, and it’s why the foundations we lay today matter so much for tomorrow.

The UK has all the right ingredients and the opportunity is within our grasp. Now it’s time to seize it and move at pace – or as I would say in my native US vernacular…Let’s Go!

1. Clean energy projects prioritised for grid connections: Read more
2. STEAM Education in Portugal: What’s All The Buzz About: Read more
3. Key facts about the UK as an international financial centre 2024 | TheCityUK: Read more
4. techUK Report – Foundations For The Future: How Data Centres Can Supercharge UK Economic Growth: Read more

This article was first published in Capacity. Read the original article here.