The government is urging tech companies to target the education and healthcare sectors as it encourages the industry’s growth outside London.
The digital economy minister, Ed Vaizey, wants the next generation of tech entrepreneurs to focus on sectors that are largely state-backed. Wherever government is involved as a buyer of services, Vaizey said, it should make the most of new technology. “In education, universities and colleges are already using massive online courses, so lectures and courses can reach a much wider audience, costing less. Could schools benefit from similar innovations?” he said.
Vaizey said the NHS still relies top-heavily on paper-based bureaucracy and requires further digital innovation “so that our amazing doctors and nurses can spend more time saving lives and improving care”.
In a new year message, Vaizey said he wanted to see the digital economy expand its footprint outside London, as he applauded the establishment of tech strongholds beyond the capital. More than 70% of digital businesses in the UK are based outside London, including flight comparison site Skyscanner in Edinburgh and social media monitor Brandwatch in Brighton.
When the government set up Tech City in east London in 2010, it helped create a cluster in an area that was close to the City’s financial district but benefited from lower office rental costs compared with the Square Mile. However, critics of the project warned that it focused too closely on London while other parts of the country were being neglected.
Now Tech City’s remit is as much about spreading the digital economy throughout the UK as it is about creating national champions, such as Zoopla, the property website and Just Eat, the digital takeaway food group. For instance, Tech North was founded in 2015 to support digital entrepreneurs in the north of England.
A recent report from Tech City, entitled Tech Nation, shows that more than six out of 10 employees in the digital economy live outside inner London and that Bournemouth and Liverpool head up the five fastest growing tech clusters.
In the latest list of new joiners to Tech City’s Future Fifty, a programme for companies that represent the sector’s brightest stars, there are several potential high-flying businesses from outside central London. Alongside Skyscanner and Brandwatch, they include Crowdcube, a crowdfunding vehicle from Exeter, and Floow, a Sheffield business that monitors drivers’ behaviour. Clusters of digital activity outside London include Cambridge for hardware, Belfast for cybersecurity and Liverpool for gaming.
Key to spreading digital outwards from London is the rollout of superfast broadband. Currently it is available to 90% of the UK but the government’s aim is to extend this to 95% by 2017. Vaizey said the government is planning to give every home and business the legal right to request fast broadband.
The UK tech industry has already established a foothold in the world of e-commerce, for example, where its share of retail sales at 11% is higher than in the US, according to a recent report. Alongside healthcare and education, Vaizey now wants UK companies to be at the forefront of experimentation in new digital-inspired businesses, such as driverless cars or drones for the delivery of goods. “How can we make sure the UK is at the cutting edge of these developments?” he said.
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