Industry Insights
The UK’s ICT market offers excellent business opportunities, especially in cybersecurity, software and SaaS cloud computing, fintech, and the Internet of Things. In addition to its competitive nature and moderate concentration, the UK ICT market has an abundance of business innovations (NI et al., 2022). As Mordor Intelligence’s findings show, key players adopt product and service innovations to maintain market share, followed by mergers and acquisitions that allow them to expand and remain competitive (Mordor Intelligence, 2023).
ICT companies in the United Kingdom are among the world’s most significant, contributing significantly to economic growth. By investing in ICT, the UK can continue to compete in the global market, ensuring businesses have access to cutting-edge technology. Investing in ICT helps the UK’s economy to be sustainable over the long run by encouraging innovation, creating jobs, and improving public services.
ICT solutions are now focusing on keeping companies competitive and a step ahead. Among these technologies are IT infrastructure, cloud computing and data analytics, which will help businesses make the most of digital transformation. Artificial intelligence and machine learning are the keys to this advancement (Mordor Intelligence, 2023).
ICT is predicted to grow at a 7.8% annual rate in the UK when new technologies like edge computing and quantum computing are implemented, leading to new job opportunities and enabling businesses to improve their services. As a result, companies can do more with fewer resources, leading to greater workplace efficiency. Consequently, firms will have to shift their IT systems to the cloud to cope with the growing amount of data generated by this expansion (Mordor Intelligence, 2022).
Industry challenges:
- Delivering business results despite macroeconomic uncertainty
- Having to navigate business prospects in an uncertain environment
- Achieving regulatory compliance
- Identifying and filling the technological skills gap
- Keeping costs in check while maintaining performance
(Deloitte, 2023; Global Data, 2022; Open Access Government, 2023)
Investment opportunities:
- Connectivity and computing are becoming increasingly important
- Keeping ICT and digital services sustainable
- Support for 5G infrastructure
- Legacy (ICT) Infrastructure
(Computer Weekly, 2023; Open Access Government, 2023)
Statistics:
The United Kingdom’s ICT market is estimated at £122,39 billion (Global Data, 2023)
As of January 2022, 66.99 million UK internet users were online (Mordor Intelligence)
The number of mobile connections in the UK was 71.8 million in 2022, an increase of 3.8% from 2021 (Mordor Intelligence, 2023)
Industry Insights
The UK is Europe’s top scaling tech nation, with no sign of slowing growth. More than a third of Europe’s fastest-growing tech firms are based in the UK, thanks to its highly-skilled workforce and easy access to foreign markets. 2021 was the best-ever year for the UK tech sector, with £26bn in venture capital (VC), record London listings, more jobs and the number of British unicorns (a start-up valued at over $1 billion) climbing to 116.
The pandemic has driven demand for remote work software and has accelerated the shift towards cloud-based HR and payroll systems, along with other emerging working practices and procedures. Meanwhile, business apps have flourished over 2020-21 and are projected to continue their ascent over the coming five years (2021-2026) to accommodate the surge in video conferencing and other forms of remote communication (Ibis World, 2021)
The outlook for 2022 is highly optimistic; most tech companies surveyed by industry body tech UK expect sales, investment and headcount to increase significantly. British Fintechs have been a driving force, having lured in more funding in 2021 than the rest of Europe, the Middle East and Africa combined. Industry consensus ties the future of innovation to the use of Artificial Intelligence, Robotics, Cybersecurity, Blockchain, Internet of Things (IoT), Virtual Reality (VR) and Augmented Reality (AR). The companies pioneering this innovative technology are generally involved in multiple forms of tech, like robotics and cybersecurity (Tech Nation, 2020).
Industry challenges:
● Slow Growth (Ibis, 2020)
● Cancellation of ICT Events (Globe News Wire, 2020)
● Disruption of Supply Chains (Globe News Wire, 2020)
Investment opportunities:
● Social distancing and isolation have helped the telecommunication sector maintain its growth trajectory (Globe News Wire, 2020)
● Digital innovation (Tech Nation, 2020)
● Momentum in social networking, short videos and mobile gaming (Globe News Wire, 2020
● Increased value of the Bank sector due to the pandemic (New Financial, October 2020)
Statistics:
UK fintech investment jumped to $37.3bn in 2021, up sevenfold from the previous year, powered by several mega-deals, including significant raises by Checkout.com and Revolut (Altfi, 2022).
Nearly 4 in 10 (39%) companies identify increased support for R&D and innovation as the most important way the government can aid the sector, ahead of improved training and access to overseas talent (Tech Monitor, 2021).
Tech sector GVA grew nearly six times as fast as that of the UK economy as a whole – £104bn in 2010 to £149bn in 2018, +43% in eight years (Tech Nation, 2020).
UK tech employment grew by 40% over 2018-2019, accounting for 9% of the national workforce with 2.93m jobs created (Tech Nation, 2020).
UK tech companies aligned with United Nations Sustainable Development Goals have raised £2.2bn over the last six years, the highest in Europe (Tech Nation, 2020).