The Big Digital Debate – the business question: Where is the UK’s Facebook or Google?

Last night’s TechUK Big Digital Debate saw Ed Vaizey MP, minister of state for Culture and the Digital Economy, Chi Onwurah, MP, Shadow Cabinet Office Minister and Julian Hubbert, MP Liberal Democrats spokesman discuss the future of the UK tech sector.

The business topic was a chance for politicians from the leading parties to provide a vision of how the UK tech sector can scale to compete in a global market.

Sadly, despite been given the opportunity of answering some good questions, the panellists fell short of seriously addressing the business issues.

As David Wood @dw2 tweeted: "The good-humoured bonhomie on #DigitalQT panel is a bit wearing. Success with technology is an existential question for the future of UK."

That there is a general election in just three months time was obvious.

The opening statements saw the politicians stick to their scripts.

Mr Vaizey spoke of capital, infrastructure, skills and data. Ms Onwurah covered digital inclusion. Mr Hubbert spoke of liberalism and technology being closely linked and bemoaned the ignorance of most things digital among MPs.

Whether it was a case of powder being kept dry it did have the feeling of battle lines being drawn but no-one being quite ready for battle to commence.

The full debate covered:

Business – the UK being good at start-ups but failing to produce a Facebook or Google.

Government – The digitisation of government services. Has GCloud and the Digital Marketplace succeeded in opening up to UK tech players the market worth billions of pounds of public money.

Also covered were data protection in Europe, digital identity and protection.

While there was a little too much agreement going around to class it as a fierce debate, there were some good points made.

The business question

Will the UK will ever produce a Facebook or a Google?

The current Government was praised for its efforts in fostering a start-up culture but came under some criticism for not doing enough to help firm’s scale from small through mid-size to become truly international.

Mr Vaizey did raise the prospect tweaking the tax system to encourage mid size UK firms into sticking it out and acquiring for growth instead of reaching a particular scale and putting up the ‘For Sale’ sign.

Mr Hubbert pointed to the success of ARM, the UK chip maker which now powers almost all mobile phones in the world – ‘Do you think it got to $10bn without anyone noticing? No of course it didn’t.’

Ms Onwruah said much more should be done to shout internationally about UK successes.

The UK VC community also came in for criticism.

UBER, the global taxi app firm was given a $100m in investment in the US but Mr Vaizey asked: Where is the VC in the UK who would invest £100m in a UK digital start up?

When the conversation turned to government spend the debate travelled the usual path of whether the big six oligopoly could be broken. The conclusion was that G-Cloud and Digital Marketplace have been successes – though we await figures.

What was missing?

The answers failed to address some of the fundamental issues and the overall agreement had the tone that if only we could get the rules right then the UK could build world beating tech businesses.

On the business question the politicians came across as a bit old fashioned.

There was very little forward thinking. For example the market forecasts say the Internet of Things is going to be a $15 trillion global economic engine in the next decade.

The new generation of entrepreneurs should not be worrying about whether their start-up can get onto a Government approved supplier’s list. And nor should they.

Google, Alibaba, Facebook, ebay, Microsoft, Intel, EMC, Netapp, VMware and even ARM all grew in fiercely competitive markets by breaking existing market strangleholds or offering consumers something of completely new value.

Turning UK Intellectual Property – where it is certainly a world leader – into world beating businesses has been achieved.

In each success the firms had to compete. Intel did not invite ARM to become a global rival.

Be it in tin shifting, software development or web scale services the global digital tech sector is fiercely competitive and the pace of technology change is accelerating and so are the markets. By its nature the tech market is instantly global in terms of opportunity and competition.

Certainly UK firms should go for scale compete with the big incumbents.

But rather than obsessing on having one of the top six it would be better for the UK economy (and for the ambitions of the businesses themselves) to concentrate on ensuring the UK tech sector is well represented in the top 6000 global tech businesses.

For comments see #DigitalQT

Some UK tech firms I have interviewed recently:

Computacenter

Pulsant

Kimble Applications

 

 

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