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A British Digital Success Story

In recent news, it was predicted that the UK’s economy will become the second-largest in Europe by 2020, overtaking that of France. There are many, many factors that contribute to this projection but how does the data centre fit into all of it?


During the global recession in recent times, many industries in the UK have suffered. Construction, manufacturing, retail, hotels and restaurants experienced the most pain. None more so than the real estate sector, which endured the most casualties with over 12,000 enterprises entering insolvency between Q2 2008 and Q4 2009 alone. However, there was one sector that defied the trends, boldly tending the flame of progress while the world around it descended into economic chaos.

In 2010, research assessing the internet’s economic impact in the G20 made an extraordinary discovery. Not only is the global internet economy on a rising trend to reach $4.2 trillion by 2016, but the UK is firmly leading the march. A report from the Boston Consultant Group showed that the UK’s internet economy accounts for more than 8% of our GDP. Following behind were South Korea (7.3%), China (5.5%) and Japan and the US (4.7% each). It was forecast that by 2016, that figure will grow to 12.4% in the UK, contributing £225 trillion to the UK economy.


In 1985, the first .uk domain was registered. So quietly so that Nominet, the .uk registry owner, forgot what the domain was. Today the country stands as the largest per capita e-commerce market on planet Earth.

Around 60% of the internet’s contribution to the UK economy is down to the amount that users spend on online shopping and connections to the web. In fact, for every £1 spent online to import goods, £2.80 is exported. To put that into perspective, the BCG report showed that the offline economy is very much the reverse, where for every £1 imported, just 90p is exported.

In 2011, the government launched the ‘East London Tech City’ initiative to entice new tech start-ups to the area. It has since thrived, becoming the 3rd largest technology start-up cluster in the world after San Francisco and New York City. In 2008, there were around 15 media and high-tech companies close to the Silicone Roundabout, which forms the heart of Tech City. In just 4 years, over 5,000 firms were believed to be occupying the surrounding areas due to a rapid increase in interest in the cluster.


Despite the high cost of real estate, London stands as the largest single data centre market in Europe, with raised floor space forecast to increase to 300,000sqm by 2015. Giants such as Google, Facebook, Equinix and Telehouse Europe have capitalised on London’s interconnected ecosystem on which new datacentres are built.

But London is just the start. The M4 corridor has long dominated Britain’s tech economy.  A report from Tech Monitor UK showed that the Silicone Roundabout was not in fact the UK’s tech capital, but instead a small market town in Berkshire.

With the highest employment rate of technology professionals in the UK, Wokingham boasts a proportion that is five times the national average. Being home to the UK headquarters of Future-tech and global giants such as Microsoft and Oracle, tech companies seemingly share the same optimism about the UK’s digital economy. With consistently more job opportunities available than any other sector, it would appear that the UK’s digital economy not only survived the recession, but thrived in it.


The UK has long been viewed as a global technology hub, and as the evidence suggests, there are no signs of that changing. With the rapid increase in data centre builds, technology start-ups and global corporations now calling the UK home, it would appear that the march toward an unparalleled internet economy is only just getting started.