Inline Insights

The government continues to prioritise tech policy in the UK with London Tech Week, the Spending Review and AI Summit London all highlighting the important role government expects tech to play in driving economic growth. Here are some reflections on what it may mean: 

SUMMARY

• Both the Spending Review (SR) and London Tech Week had a heavy AI focus, with government committing to making the UK ‘the best place for Tech and AI’.

• This commitment included £2 billion to support the work in the AI Opportunities Action Plan, including the new UK Sovereign AI Unit, and an acknowledgement that more work needs to be done to drive widespread AI adoption and to scale and keep AI companies in the UK. It also included £86 billion in wider funding for R&D accelerator programmes including in AI.

• The government has backed both public sector and private sector AI as a tool for growth. This includes a significant uptake of AI across the NHS and other public sectors to drive productivity and balance the departmental budget cuts. 

• Whilst these announcements are good for the sector, it could be a while until these policies lead to economic growth. The government will also need to balance mass scale up of AI with clean energy commitments, particularly around data centres and infrastructure, as included in the AI Opportunities Action Plan. 

• Government may need to do more work to build public support for AI with London Tech Week discussions pointing to public fears over AI. A global survey published this week suggests that 43% of UK Gen Z workers are worried AI will replace them in the workplace. 

• Other tech policy developments, such as the Data (Use and Access) Bill debate around copyright and AI training, could lead to concerns amongst parliamentarians regarding the rapid adoption of AI leading to less desirable outcomes for society.

Additional reflections on the government’s approach to digital technologies are below.

ON AI:

• The government commitment towards making the UK the best place for AI involves significant investment. The Spending Review committed further funding of £2 billion to support the work in the AI Opportunities Action Plan, including the new UK Sovereign AI Unit. This is a key part of the government’s plans to ensure AI companies grow, scale and remain in the UK following high profile sales of UK AI companies to the US.

• The Sovereign AI Unit will need to be successful if the UK AI sector is to expand and contribute to growth.  However, keeping AI firms in the UK could be challenging due to AI start-ups often relying on a buy-out by a larger tech firm when securing investment. To try and address this, the government has also relaunched a VC fellowship programme to increase the capacity of the UK financial sector to invest in up-and-coming technology.

• Whilst there have been some notable outputs from the AI Opportunities Action Plan, including AI growth zones and other infrastructure commitments such as establishing data centres and new supercomputers, more needs to be done if we are to see the mass adoption and integration of AI across the UK economy.

• The government has acknowledged the importance of employment in growing the AI sector and is looking at skills and visas to ensure the UK can hire and retain talented individuals.

• There are still concerns amongst parliamentarians that the government is committing too fast to AI and has not fully considered the risks. The recent debate around copyright and AI as part of the Data (Use and Access) Bill highlights uncertainty around training methods and whether AI companies are using data in a lawful manner. UK digital regulators are prioritising AI, with the CMA and ICO scrutinising foundation models to understand how they comply with existing legislation.

ON DIGITALISING PUBLIC SERVICES: 

• The government is prioritising investment in digital and AI across public services, including the NHS, with an additional £1.2bn over the SR period to support cross-cutting digital priorities.

• Making data easier to access and share for research or public interest purposes is one of the changes in the Data (Use and Access) Bill and is crucial in helping the public sector develop and fine-tune AI tools and digital technologies that will work effectively. For example, it is currently difficult to share data between NHS Trusts or government departments, limiting the ability to make adaptable AI solutions (as shown by the release of smaller specialist AI tools such as the HMT internal search tool and the consultation tool).

• The Department for Science, Innovation and Technology (DSIT) will oversee this public sector transformation and set out the proposals in a Digital and AI Roadmap later this year. The public transformation is a key part of lowering government spending by automating and reducing the time and resource spent on administrative tasks. The government is likely to expect this to support key priority areas such as NHS waiting lists and access to wider healthcare.

‘Artificial intelligence’ is so 2024! The European Union has two new favourite words when it comes to tech: quantum computing. But what does it mean? Imagine a cat (Schrödinger’s cat, to be precise) alive, dead — and somehow applying for Horizon Europe grants — all at the same time!

Across the globe, nations are racing to harness the immense power of quantum technologies; the EU is trying to ensure it doesn’t just keep up but actually leads the charge. To this end, the EU is betting on becoming a quantum powerhouse: through strategic investments, cutting-edge research and bold new infrastructure projects.

This blog will explore what quantum computing is and how the EU is trying to win the quantum-computing race.

Schrödinger’s cat

Quantum computing represents a paradigm shift in that it operates on fundamentally different principles than classical computers, which process information in binary bits (ie, 0s and 1s). Quantum computers, by contrast, use qubits (kjuːbɪts), which can exist in multiple states simultaneously. This allows quantum computers to perform vastly more simultaneous calculations than traditional computers can, enabling quantum computers in turn to solve problems many times more complex.

Another key feature is called ‘entanglement’, a phenomenon whereby qubits become interconnected, such that the state of one is dependent on that of another, no matter how far apart they are. This interconnectedness enables quantum computers to handle massive datasets and to model intricate systems, such as the chemical reactions used in pharmaceutical research or the complex optimisation problems required for logistics.

But quantum computing has major trade-offs, too. On the pro side, it could revolutionise cryptography, AI and material science. And the cons? Quantum systems are very delicate, needing near-zero temperatures and isolated environments to function properly, which makes them costly and hard to scale. They’re also limited in scope, with high error rates, as quantum processors are still in their experimental phase.

What’s the EU’s plan?

The EU has ambition, funding and a strategic roadmap — but is it enough? The bloc faces hefty competition from the US and China, racing ahead in quantum research backed by massive state-funded initiatives. China, in particular, has made groundbreaking advances, like its quantum-secure satellite enabling unhackable communications. Meanwhile, the US boasts powerhouses like Google, IBM and Microsoft, which are leading the charge in quantum hardware and software.

The EU is betting big on tech sovereignty, meaning it wants to avoid dependence on either American or Chinese quantum systems. There is a push to develop EU-made quantum hardware and use EU-developed quantum encryption for securing communications across the bloc. The EU also hopes it can draw on an ace up its sleeve: collaboration. To a greater extent than the China or even the US rivalry, Europe hopes to pool resources, talent and research across multiple nations, making breakthroughs more likely.

One of the EU’s most ambitious steps has been integrating quantum computers into its existing supercomputing network. The European High-Performance Computing Joint Undertaking (EuroHPC JU) is leading the initiative. In October 2022, the EuroHPC JU selected six EU sites (Czechia, Germany, Spain, France, Italy and Poland) to host Europe’s first quantum computers, integrating them into EuroHPC supercomputers. These systems, built entirely on European technology, are backed by a €100-million investment, split between EU Member States and 17 other participating countries. This marks the first step toward a European quantum-computing infrastructure, providing cloud-based, non-commercial access for both researchers and industry. With massive computing power, the project aims to tackle till-now unsolvable problems in medicine, materials science, weather forecasting and transportation, accelerating innovation across sectors. These machines will work in tandem with classical supercomputers to create hybrid systems with super-capacities.

Individual Member States are making breakthroughs, too. Spain unveiled its first domestically built quantum computer at the Barcelona Supercomputing Center — an achievement underscoring a growing commitment in Europe to technological sovereignty. Funded by Quantum Spain with over €9 million, this quantum machine is expected to revolutionise logistics, financial modeling and AI applications. Germany is also making strides with the Q-Exa project, which aims to integrate a quantum computer into the Leibniz Supercomputing Centre to accelerate research and industrial applications.

Beyond infrastructure, the EU is actively fostering quantum R&D through several flagship projects. The Quantum Technologies Flagship, a €1 billion programme launched in 2018, continues to fund groundbreaking research across quantum computing, quantum communication and quantum simulation. It supports projects like OpenSuperQ, which aims to build a 100-qubit superconducting quantum computer in Europe, and PASQuanS, which focuses on quantum simulation for material science and complex-system modeling.

The EuroQCI (European Quantum Communication Infrastructure) Initiative is another critical effort. Led by the European Commission, the project aims to establish a secure quantum communication network across the EU, enhancing cybersecurity and protecting sensitive government and financial data. By leveraging quantum-key distribution (QKD), EuroQCI will lay the foundation for a quantum-driven internet of the future.

Ultimately, the EU’s Digital Decade strategy makes clear that by 2030, the EU must become a global leader in quantum capabilities. The 2023 European Chips Act supports quantum chip manufacturing, ensuring Europe isn’t just a consumer of quantum technologies but a key player in their development. And as hinted in the September 2024 Draghi Report, in Commission President von der Leyen’s mission letters in September 2024 to her new team of commissioners, and in the autumn 2024 confirmation hearings in the European Parliament for those commissioners-designate, the EU has committed to an increased focus on quantum computing during the 2024-2029 mandate. The Commission’s just-published 2025 work programme projects a Quantum Strategy by June 2025.

Quantum leap?

The US is pouring money into quantum. China has kept its quantum developments under wraps — while pursuing superpower status across all domains. And the rest of the world is catching up fast. To secure its place in the future of computing, Europe can’t wait: more investment, faster innovation and stronger collaboration are needed. Or else Europe risks playing catch-up while others take the lead in defining the rules of the quantum age.

This blog identifies some of the key recommendations made in each of the recently published AI Opportunities Action Plan’s sections (investing in the foundations of AI, pushing on cross-economy AI adoption, and securing the UK’s future with homegrown AI), highlighting those which offer the most promise to AI developers or adopters. It will then consider how Inline is well-positioned to leverage its tech expertise and relations with government to assist businesses in realising their AI ambitions.

Dr Aura Salla, elected in June 2024 to her first mandate as a Member of the European Parliament (MEP), is no stranger to EU policy, having worked for many years in the European Commission and for Meta, as the company’s head of EU affairs. She was also elected to the Finnish Parliament in 2023. Since taking up her seat in the European Parliament in July 2024, MEP Salla has advocated stronger EU support for Ukraine and a steady commitment to both the green transition and a more capable and competitive EU — in particular vis-à-vis China and in light of a second Trump administration. 

I spoke recently with MEP Salla (whom I will refer to here as Aura) about what she sees as the EU’s major challenges for the new mandate, in particular regarding technology and global competition. Here follows a brief summary of our conversation.

The Labour Party's annual conference took place in Liverpool from Sunday 22 September to Wednesday 25 September. While the conference did not provide much detailed policy discussion, it was a chance for the new government to communicate its agenda and the role it foresees for tech. In this blog, we outline the key takeaways and policy announcements from tech discussions at the Labour conference.

I sat down for an hour-and-a-half in early August with Kai Zenner, longtime policy advisor to MEP Axel Voss. Brussels had emptied for the summer, and we sported shorts and t-shirts at an outdoor café in a quiet Place du Luxembourg. We talked about his background in EU digital policy, and in particular about the future of AI, in Europe and beyond. A recurring theme was the EU’s need to think globally and strategically — rather than along nationalistic or ideological lines — in order to compete and stay relevant. Here’s a summary of our conversation.

In this blog, we look at the future of European telecoms legislation, including the possibilities for a Digital Networks Act during the 2024-2029 mandate.

In this blog, we analyse the Labour government's planned reforms to the UK's data protection and cyber security frameworks.

In this blog, we investigate what role current French Commissioner for Internal Market Thierry Breton might play in the upcoming European Commission.

On 28 June, the US Supreme Court overturned the ‘Chevron deference’, an administrative law principle allowing federal agencies to interpret and implement statutes with the understanding that federal courts would ultimately defer to those agencies’ interpretation of ambiguous laws. In this blog, we will go over the Supreme Court’s ruling and the implications it could have on the technology sector, with a particular focus on AI.

European Commission President Ursula von der Leyen has won a second five-year term. Her focus will be competitiveness, security and sustainability — defined less by green ideology than a push for clean industrialisation. With the European Parliament’s committees now formed, work will start in the autumn: to vet commissioners-designate, and vie for political control of the new programme. In this blog, we explore the key committees and committee members for the tech sector.

On 17 July, King Charles III delivered the King's Speech, outlining the government's legislative programme for the new parliamentary session. The government has announced 40 bills which aim to unlock growth and ‘take the brakes off Britain’. This blog examines the proposals affecting the tech, climate, and energy sectors, and what business should expect as the government introduces legislation.

The electorate has given Labour the second-largest majority (after Tony Blair in 1997) in British parliamentary history since Clement Atlee led a Labour Government in 1945. While the result needs to be qualified by the low voter turnout (at an estimated 60%, it was the second-lowest in post-war history) and the low share of the vote that Labour obtained (at only approximately 34%), the size of its majority means the party will have a largely free hand in pushing its agenda through parliament. Now that the UK has a new Prime Minister, a new parliament, and, shortly, a new cabinet, we look at what Labour’s victory could mean for the tech as well as the climate and energy sectors.

In advance of the General Election on 4 July, Parliament has been formally dissolved. This Parliament, constituted following Boris Johnson’s landslide election victory in December 2019, has passed several pieces of important tech legislation, though some others have fallen by the wayside in the rush to finish business before dissolution. In this blog, we examine what the 2019-24 Parliament, and the government which commanded a majority within it, did for the tech sector. 

In advance of the European Parliament elections between 6 and 9 June, the candidates from five of Europe's major political groupings debated one another across a wide range of issues, including the economy, the climate and the environment, and technology policy on 23 May 2024. This briefing provides a summary of the key points each candidate made during the debate.

The Digital Markets, Competition and Consumers (DMCC) Act establishes a new regime for digital competition in the UK. The Act also updates the Competition and Markets Authority’s (CMA) powers to enforce existing competition law and resolve consumer disputes, and protects consumers from unfair commercial, subscription, prepayment and saving schemes. The Act received royal assent on 24 May. In this blog, we discuss the new ex-ante competition regime established by the Act and what companies should expect as the CMA begins to enforce the legislation. The blog examines how the UK general election might influence the enforcement timeline. 

The prime minister has announced that he is calling a general election on 4 July. Here is what happens next.

In the fast-paced world of social media, concerns about digital addiction are taking centre stage once again, with TikTok and Meta at the forefront of scrutiny.

Three key EU institutions - the European Commission, the European Parliament, and the Council of the European Union - walk into a room. It sounds like the start of a bad joke, but trust us, it's anything but! They're there to work through laws, policies, and regulations that impact the lives of over 500 million Europeans. In this blog, we're going to lift the curtain on trilogue negotiations and shed light on why this resolution is useful for the swift functioning of EU policy making.

The Media Bill is a broad piece of legislation which will, amongst other things, makes changes to the way in which video-on-demand services are regulated in the UK. On 28 February, the Media Bill will have its second reading in the House of Lords, having been passed by the House of Commons. In this blog, we discuss the implications the Media Bill will have for the video-on-demand sector in the UK, as well as the next steps.