UK Has ‘No Chance in Hell’ of Making Its Own Tech Champs: ARM Founder | Hacker News Reader

UK Has ‘No Chance in Hell’ of Making Its Own Tech Champs: ARM Founder

bloomberg.com

128 pointsxqcgrek2122 comments

It sounds to me like he doesn't actually say that. In the article:

>The UK has “no chance in hell” of becoming technologically sovereign

Well which is it, having our own Tech champs or being technologically sovereign?

Because they're totally different things. To be honest I'm not sure any country apart from China stands any chance of becoming technologically sovereign. Like what does that mean? Do we need to mine our own Lithium, do we need to build our own foundries, are we planning on building a competitor to ASML to source machines to build our foundries? And look at Oil prices, the UK isn't massively dependent on Oil and we have our own resources but we still got absolutely slammed by the war in Russia because we operate in a global market. So do we need our own Lithium mines and export controls to stop them being bid up on the international market when there's some exogenous event?

This is not how the article approached technologically sovereign at all, as is this is just a strawman argument. No one proposed that sovereignty is about producing everything from scratch yourself. Here's the actual excerpt:

> One question countries have to ask themselves if whether they have all the critical technologies needed to run a country and its economy.

> “The answer for Britain” is “absolutely no, there is no chance in hell that Britain could ever become technologically sovereign,” he said.

Do you mind explaining more clearly the difference between your understanding of what the article means, and what the GP wrote? They seem pretty similar?

I'm in the same boat as you.

I'm not sure exactly what, "whether they have all the critical technologies needed to run a country and its economy", means.

When I think "critical technologies" I think of a lot of what SilverBirch was bringing up.

When I think of, critical technologies [...] to run a country and its economy, I think of things like: EMS, traffic lights, the stock market, electricity, etc.

Similarly, saying something like "economy" could either mean, "businesses specific to Britain", or, "the 'economic climate' of Britain, which is influenced by a global market".

Example:

Can a technology firm start up in Britain? Absolutely. They might even do well, depending on how they're run.

Can a technology firm start up in Britain and immediately sustain the current economy that British Citizens are currently accustomed to? That's a bit of a taller order.

It's hard to get a feel for exactly what is meant by how the statement was worded. Any country can compete, but without the global resources provided by businesses that exist across the world, any local-only upstart is going to struggle to be competitive in any part of any market.

I think you're reasoning about it from the wrong end.

The implied precursor I took from the article was that another nation suddenly decides to remove access to a critical technology, via coercing or ordering the company supplying that technology.

"Technological sovereignty," in the context of the article and quotes, would mean a country has the means to continue without that access.

This doesn't mean creating a commercially-viable, world-leading industry (there can only be so many of those!), but does mean having a plan and emergency suppliers who can make functional substitutes.

As an example, the US's strategic petroleum reserve made it sovereign in the matter of energy (effectively, and pre-recent production increases). Which is also a good example because it didn't mean 1:1 replacement of 100% of supply volume, but rather replacing enough so that alternate suppliers can be switched to and restricting access lost its power.

But that was my read. Ymmv.

Ah, that makes sense. Thanks for that!

I was coming at it from a, "Let's isolate ourselves!" type thing.

Yeah, even something “simple” like a replacement of Visa or Mastercard is quite complicated.

That's not how these two credit card networks work.

You have card issuers and acquirers, both of these can be local, so it's not a big issue if you're cut off from the world.

It's more like a web of trust peer-to-peer protocol, so if a foreign entity removes you from the web of trust, you'll still be able to have transactions with anyone that still considers you trustworthy.

That's probably the only reason why visa/Mastercard is so broadly accepted.

Amex is run differently, and it's rarely accepted outside of the USA for example

It isn't simple because Mastercard literally runs the interbank payment network for the UK.

Which is why simple is in quotes.

“Simple”, as in everyone takes it for granted

Why would anyone expect that from a small country? If it was part of the EU - yeah you should expect the EU to be technically sovereign. But not a small island who decided to leave (so they could make bankers richer and the poor poorer).

I hit a paywall. http://archive.today/U6BUV

> [...] whether they have all the critical technologies needed to run a country and its economy.

That's what he seems to mean by "technologically sovereign": apparently, it comes down to being able to build computers from sand and copper ore. Well, if you define "sovereign" that way, then of course the UK can never be sovereign. Napoleon called us a nation of shopkeepers; we've been dependent on trade for 400 years.

Maybe he's just having a go at the new Tory leadership, which has some odd notions about being completely independent of any one else on principle. But if that's it, it doesn't come across in the article.

I get your point, but the word “sovereign” carries very particular implications that make it a poor choice by the interviewee in this context. I think it’s uncharitable to characterise GP’s argument as a strawman.

No nation, anywhere on the planet, is by itself technologically sovereign. The ability to get by in the world is a cooperative venture for everyone, even the US. What makes first tier technological nations different is the alliances of which they are active contributing members. Those alliances make trade flow smoothly and securely. That is what creates prosperity in an interconnected world.

That is especially important in evaluating China's ability to achieve technological first tier status. China has one formal alliance. It is with North Korea. This is remarkable. China cannot rely on Japan, Taiwan, Philippines, Indonesia, Malaysia, nor even any country with a land border with China as an ally. China's neighbors are threatened by China, are hostile to China, or are just extremely wary of China. China's navy cannot project power beyond the island nations off China's coast.

China's position and prospects are less advantageous than it seems to many people.

> China has one formal alliance.

This is a geopolitical trope about 20 years out of date. Don’t be surprised when dozens of African and Asian countries choose China over Western interests if push comes to shove.

> Don’t be surprised when dozens of African and Asian countries choose China over Western interests if push comes to shove.

And don't be surprised if they don't. Even if China has a lot of frenemies on its border in Asia, every country in Asia has some fear over China, and this often pushes them to improve their relationship with the USA (e.g. Vietnam). Even Russia and North Korea have some antagonism with China. None of their relationships are particularly strong.

> This is a geopolitical trope about 20 years out of date.

I don't think. China hasn't done much to court soft power in the last 20 years beyond a some loans for infrastructure made by Chinese companies. They still are inwardly focused.

1. China has been building out their railroad net for years now, both internally and reaching outwards

2. Those synergize with the loans. They are not "some" loans

3. Cultural exports have been going on for a while, though it has not been as successful as South Korea or Japan

4. China has been seriously wooing back Western-educated citizens to head R&D in a variety areas, for the past ten years or so. Quality-of-life, career advancements, respect and social status exceeds that of staying in the West. That's more the sufficient to successfully bring expertise back.

5. China has been adding more people into the international computing and network standards community. They are starting to influence that.

6. China has been developing its naval power. While it has yet to field a fully operational carrier group, its drone carrier program is probably further along than the US Navy

7. China needs to secure a supply of crude oil, since they are a net importer. The SE Asian shipping corridor, of which the Taiwanese strait anchors one end of it, is going to be hotly contested.

8. Along with some other countries, China has been involved in creation of an alternate world reserve currency. That is not yet successful as far as I know.

I think the general nationalist sentiment among Chinese citizens is along the lines of, "we were once a superpower, why shouldn't we be again?". And, the culture tends to be more amendable to thinking generationally; that is, the benefits may not be realized in this generation, but that's ok.

Among other things, right now I don't think Quality-of-life is particularly high if you run the risk of suddenly being locked down in place or thrown in a covid hospital (friend of mine went through both, sounded very unpleasant indeed)

Ya, China's Zero COVID policy has reversed this trend for sure. It isn't just getting lockdown that people are worried about, but the inability to freely travel without a long quarantine at the end of the trip.

TBF China hasn't got a lot of choice. They do not have a highly effective vaccine. Millions of people in China would die if COVID were allowed to spread. Damned if you do, damned if you don't.

I'm not advocating that millions of people die in a vacuum, but millions of people risking death so that the other billion people in China could live a normal life is at least worth considering the trade-off.

The median age of a Covid death in the US, with its obese and unhealthy population, is around the average life expectancy with some room for error. I can't imagine that China fares worse in that regard.

The Chinese government would likely consider letting COVID rip through the population if they could survive the consequences of an overwhelmed health system and the numbers of dead.

So that's what is surprising to me, because I figured the CCP had a fairly tight grip on power and is in no danger of being overthrown. My naive guess as an outsider was that it's face-saving for those at the very top - to make an about-turn now would be embarrassing and an admission of defeat. And that only a few specific heads that would roll, but the government itself would remain largely intact

> TBF China hasn't got a lot of choice.

I wouldn't doubt that this is true. But individuals can make choices, especially mobile techies.

> 7. China needs to secure a supply of crude oil

Wonder how that's coming along. I'm sure those African countries will stand up for China even when they can't get any oil.

Would Russia not be a more natural source of this? I know they're not exactly best pals but China is maybe one of the closer countries to Russia outside of Belarus and Syria rn.

I wonder how they would pay for it. The world market operates in US dollars so presumably they'd have to set up some kind of bilateral arrangement and I doubt Russians would accept Yuan.

Yes they would. Russia was one of countries working with China to create an alternate reserve currency. (https://coercioncode.com/2022/07/25/russia-and-china-announc... ) Sanctions on Russia over Ukraine is accelerating this.

This isn’t the first attempt. Yuan is already increasingly held by central banks (https://markets.businessinsider.com/news/currencies/dollar-v...) but I was thinking of a composite currency that included the Yuan. I don’t remember the article talking about this

Also keep in mind that Russia is not a part of OPEC, though they had historically worked with OPEC until the sanctions over invading Ukraine.

Oil and other trade between Russia and China has increased since sanctions against the Russian invasion of Ukraine.

Despite the unfavorable terms for the loan, I hear that the Chinese are regarded well in those countries.

I see China's soft power quite a bit differently. China has an increasingly large presence throughout all of Asia. There are obviously the government initiatives but in many ways the non-governmental stuff is far more visible. 1.4 billion people + rapidly growing middle class = Chinese are absolutely everywhere. Chinese tourists are playing an increasingly large role in the economies of nations throughout Asia, even including Japan with whom China has poor relations. There are also large numbers of students from China that are living/studying abroad (Gaokao), and so on.

This is all creating an increasing intermingling of cultures and economies that's improving relations in a meaningful way. It's easy to discount this sort of stuff, but I think it is what really changes the world in the longterm. When people themselves are able to change their own views gradually over time, without effort at "directing" them, those resultant views tend to be quite difficult to ever change. It's in this domain that we were once unrivaled.

Asian countries do not dislike Chinese people and culture: they have had large communities of Chinese immigrants for a long time, they don't mind the tourism and like the students as well. But that says nothing about whether they like the Chinese government or not: be it the Communists, Nationalists, or Qing dynasty, that's where the friction begins.

> beyond a some loans for infrastructure made by Chinese companies.

You say that like it's not a big deal, but it is. The Belt and Road initiative precipitated major shifts in geopolitics.

I don't think the Chinese have bought as much goodwill as they think they have, and right now many of those loans are going south fast, so it will be a real cost.

China sends a pile of money to Africa. But there is a growing disillusionment with their investments.

For example, they would promise to develop infrastructure in exchange for mineral rights. So they move in a large number of Chinese, creating zero local jobs. Then they mine out the resources as fast as possible and move out.

And right after that, the infrastructure invariably falls apart.

They can only screw so many countries before everybody catches on.

Zimbabwean here: our elite will take money from whoever will give it and make nice noises and when the time comes to pay it back in some way that involves and actual cost to themselves..........will find the next donor.

The Chinese (and any other country) will only get out of Africa that which they can demand today quid-pro-quo. There won't be any loyalty.

Here, the carrot is more money of course.

And the stick is sanctions, and then regime change/military action/etc if other countries don’t protest too much.

This has worked pretty well for the US for the last 70ish years. The same playbook can work for China, they are betting.

Zimbabwe has faced sanctions regularly - it's of little interest because it doesn't really disempower the elite.

100% the pattern I saw in other countries too; Mozambique, South Africa. No reason to expect a different trend further north

It's not even exclusive to developing nations. For example, Portugal tends to side with China.

Pakistan's airforce works closely with Chengdu Aerospace Corporation - the JF-17 Thunder [0] being their flagship product. That said, even Chinese flagship aerospace manufacturers also depend on IP transfers from Russian firms like Klimov and UEC Saturn. Also, most companies require some amount of IP transfer and collaboration because of how complex Engine design, Body design, etc are, as well as the fact that collaboration incentivizes collaborating countries to purchase these weapon systems. Aerospace, cybersecurity, enterprise partnerships, weapons systems - it's all the same business model.

[0] - https://en.wikipedia.org/wiki/CAC/PAC_JF-17_Thunder

China also has a security agreement with the Solomon Islands. While a tiny nation in and of itself, the use of the islands by the Chinese navy allow for quite a bit of force projection into the pacific. It would be very hard, for instance, for the U.S. to use their navy to defend Australia or Taiwan.

The international airport in Honiara is called “Henderson Field” and not whatever name the Japanese gave their airfield. Based on historical precedents, it might be premature to say that a naval base in the Solomons means game over for Australia.

No one knows how a military conflict between China and Australia would end. I can’t imagine it helps Australia to have a major naval military installation between Australia and one of its major allies however.

I don't imagine it would either, which is I assume why someone said something pointed to the government of the Solomons. Maybe someday, but for now China isn't really in a position to try to rebase outside the First Island Chain without permission.

https://www.theguardian.com/world/2022/jul/14/solomon-island...

Australia is kind of a fortress, just by being so physically far away from most places. All the important population centers are far to the south, so the north becomes a continent sized staging area for battle

US was near tier1 technologic autarky post war until 90s, it had unrivalled STEM talent pool (by virtue of others having relatively very little) as well as FP tools to constrain foreign high tech competition while feeling her own via favourable immigration / brain drain policies. US crushed JP semi in 80s, but chose not to continue crushing other east asian tech ambitions / indy policy in 90s-10s because it was deemed acceptable cost of feeding alliances in era of US primacy. Now US is desperately trying to reshore semi and other strategic supply chains now that she realized sensibly that interconnected world is increasingly not secure, especially in potential future frontlines of allied soil. Ultimately what likely will prevent US from recreating tech soveriengty according to analysis is lack of talent - domestic doesn't produce enough, nor can current immigration policy close gap.

> especially important in evaluating China

Not particularly. PRC doesn't need alliances to leech off, because she has the demographics headroom to generate massive talent and governance power to systematically build academic / R&D / S&T institutions to harness said talent to be directly competitive with US + co. Mostly indigenously with big bux programs to recruit critical foreign talent and espionage to fill gaps. There's a reason PRC is rapidly catching up to tier1 tech levels on almost every sector within the last 10 years now that it's producing comparable STEM talent than ALL OECD countries combined, with lagging indicator of # of PhDs undergoing similar explosion that will ultimately drive PRC to tier1 levels. PRC has the most prospects and extremely strong advantages going forward simply because it will have the most skilled workers working off a relatively comprehensive industrial/tech chain and can souly focus on achieveing technologic sovereingy without stepping on toes. Unlike US whose has to balance providing advanced allies both security and prosperity. It's increasingly unable to do the former in PRC's back yard and now the latter is being harvested/reshored to US soil

As for PRC's neighbourhood... was US at height of primacy threatened by Cuba / South America? There was some fucking around and finding out. Folks in the neighbour hood can see which way the winds are shifting. PRC's growing power has already pushed most of region into neutrality and hedging, while actual US alliances are giving nothing but platitudes - very little concrete actions that actually boostered US defense position within 1st island chain. Also PRC has massive blue water navy with expanding replenishment fleet, it just doesn't choose to project outside of 1st island chain much, but it does regularly. Aleutian Islands this week.

Lithium, ironically, is one of the few resources that the UK has plenty of.

https://inis.iaea.org/search/searchsinglerecord.aspx?records... (1987)

https://cornishstuff.com/2021/02/02/high-grade-of-lithium-fo... (2021)

Other things, like nickel, would be more problematic.

I think it's a huge stretch to say the two concepts aren't related.

To take the example of the military; we have the "military industrial complex" which is the collection of private companies that form the vital part of the state's war functions.

To become technologically sovereign will require a similar basket of private companies based in your own State, unless you expect the government to be capable of all of these tasks effectively itself. Think universities, chip designers, fabs, factories. This is also not an all or nothing choice - the absence of Lithium in the UK is not a good argument against considering strategically what aspects of the tech industry should be sovereign.

Exactly. And I would add, it is not about producing everything, but being able, if need be, to produce it. To have enough know how inland.

Also, it may be soon economically viable to harvest lithium from the ocean :)

"Technologically sovereign" means that a country is able to get the technologies it needs to achieve it's goals either internally or through alliances that don't create a "one-sided structural dependency." [1]

Saying that the UK isn't technologically sovereign is essentially saying that the UK has an undersized technology sector and doesn't have enough power to import effectively. On the flip side, you could view it as meaning that the UK has outsized geopolitical and economic ambitions given its size and technological capabilities.

[1]: https://olc.worldbank.org/system/files/Webinar%201-4_Present...

Flip side is more compelling.

I don't think loss of empire is an easy pill and takes generations to process. Different cultures cope differently. Would be interesting to hear from Turks (Ottoman) on this. Russians clearly are still not over their loss of standing. I remember scenes from BBC's spy shows (Smiley stuff) where old IC hands (recruited from elite colleges) lament and make ironic comments. British Empire was a big deal. Can you imagine the shock of dropping from that height? And you know, the brits have one quality that has always impressed me: they are irrepressible. They just don't give up. Really admire that.

p.s.

this is the moment of realization. You can see it on his face, sitting on his '[shorter] chair'. location is Tehran, Iran, 1943: https://upload.wikimedia.org/wikipedia/commons/d/d8/Tehran_C...

> To be honest I'm not sure any country apart from China stands any chance of becoming technologically sovereign.

IMHO, the US probably could manage it too: it has a big population and lots of natural resources. The reason it isn't is more of issue of ideology and will: it was far more technologically sovereign in the past than it is now, but chose to give that up so some investors could get more profits in the short-term. It's unlikely to change, since the ideologies that drove those choices are still strong.

I don’t know what you call short term, because this has been decades in the making. I’d at least call it medium term.

The flip side is now the US is more competitive globally as the products can be priced as such, in addition to consumer price decreases. You also have the issue that most Americans don’t want the ultra low paying jobs necessary to build all this stuff, nor want the environmental damage from the mining.

So it’s not so simple as just some greedy evil villains we can point to.

I wonder what percentage of the population it was that made the decision to "choose to give it up".

A smaller percentage made the many impactful choices, a larger percentage went along with it. For example, some people have always been intently "buy American", most haven't been. Few if any "buy American" people were ever involved in or supportive of moving the jobs to China, India, Phillipines, or Mexico. And it'll be iffy as to whether they have 401(k) gains from the financiers' decisions to do the movement.

I would say even China isn’t technologically sovereign, depending on how broad the definition of technology is.

As a general example, even the Chinese attempt at building a commercial airliner still uses Western engines and other avionics.

It's easy to be technologically sovereign: just give up any technologies you can't produce domestically. Isolated tribes in Papua New Guinea manage to be completely self-sufficient, to give an example.

What's impossible is staying at the technological forefront while being technologically sovereign.

Well, the nerds aren't the super rich here. It's still about public schools and old money and people who studied law or the classics or at least graduated from Oxbridge. The big money in software is all from the world of finance and there's nothing tech about them - no heart or vision except how to make a faster trade.

So who will foster a company that's not going to make money for 10 years?

I think there's also an attitude here that "having failed ever" is a black mark against a person. We really need to believe that experience is helpful and that would require some kind of cultural/personality change which I think are difficult.

Occado is potentially interesting - a lot of technology there - but it has had a lot of the "praise and then trash" kind of attention and it probably just needs to invest a lot more.

Arrival is another interesting one which might or might not make it but we should be hoping that it does and trying hard to enable it.

All true. VC's in the UK only share the name of their US cousins. They invest in established business. They are full of the orthodoxy expected of a bunch of ex-big 4 accountants that went to expensive schools.

A startup in the UK is a son of a rich man who wants to set up doing whatever, and leverages their Old Boys network to get customers.

Banks are so risk averse that it is laughable.

The idea that you could raise money based on a powerpoint presentation, like Dropbox did, is laughable in UK.

The investment culture is hard to describe with a word other than cowardly.

Yes, you're completely right. Not that I'm in favour of the wealth inequality in the US, but in some ways it's one of the US's biggest assets. There are a lot of people in the US who are so excessively wealthy they're willing to throw money at moon-shot companies (and sometimes simply ideas) that will almost certainly never yield them a return.

You don't get companies like Space X and Blue Origin without extremely ambitious and extremely wealthy individuals and the US has a large amount of both. In the UK people are generally far more conservative both with their ambitions and with their investments. We do have innovative tech companies here, but they're far less ambitions than those you'd typically find in the US. Things like food delivery, customisable greeting cards, accounting services, etc.

I think to a lesser extent there are geographical, demographical and regulatory advantages to starting tech companies in the the US too. In the UK employers have provide paid holiday, maternity leave, and pay national insurance contributions for everyone they employee. This isn't a huge issue if your a profitable company, but things like this add up if you're trying to bootstrap a company with a limited amount of VC money. Similarly, we can't scale as easily because of our geographical and demographical limitations. Europe isn't as easy to scale into for various geographic and cultural reasons and the UK as a domestic market is far smaller than the US.

While nothing I've said makes it impossible for the UK to create a tech giant, it does stack the odds against us. And just based on relative population size we're already 5 times less likely to create a tech giant when compared to the US.

I'm in favor of a system of free(ish) markets operating well, with big fortunes made from value creation and not rent-seeking behavior. If that results in wealth inequality, so be it; the old idea that a rising tide lifts all boats has not been invalidated yet.

I agree, but I think a lot of people would argue the rising tide in the US doesn't come anywhere near to lifting all boats. If you're smart and educated then US is an incredible place to live and work. If you're not then life in the US seems quite harsh by Northern European standards.

This has parellels in the music industry. A British band has "made it" only if they have made it in America.

I just interviewed at Ocado and I agree that it looks like they have it together. But then they’re outsourcing a chunk of the software to my country so not sure if that reflects well on the UK.

Another one worth mentioning a bit closer to my field is CMR - a surgical robotics company. They’re blowing enormous capital trying to conquer Europe and it might be working. Their tech is convincing and they have good showmanship. If it works out that’s an enormous market.

But it’s not visionary - just building on many incremental improvements and respectful of the thorough research and validation required. My external (optimistic) view is that this is something that is given a bit more respect in UK culture. Something about strong educational institutions and empirical reasoned thinking. But then maybe it’s just my POV?

> But it’s not visionary - just building on many incremental improvements and respectful of the thorough research and validation required

That is the core idea of most successful businesses. The same thing done very quickly is called a startup. “Visionary” is for government pork barrels, or wealthy investors that want to gamble or gain status, with the most likely outcome of becoming less wealthy.

I think building a successful business is best achieved by a series of smaller steps, with each step up-and-to-the-right. Visionary businesses that have a single wallface/cliff to climb have a horrific level of failure.

True - my point being that some of these UK companies are tackling more complex problems by methodically breaking them down.

> The nerds aren't super-rich here. It's still about public schools and old money and people who studied law or the classics

At tech companies? I think not.

I don't think he's talking about tech employees - he's talking about capitalists.

The tech industry in the US is mature enough that there plenty of "rich nerds" who made their fortune in the early days of the industry and today invest in tech startups. Hardly anyone with the money to jumpstart a startup in the UK has any interest or involvement in tech as an industry.

The capitalist class in the UK is very old and very established, and likes to invest in old and established industries. If they're not just passively extracting rent from their assets they might go as far as to let their friends in the city play with more interesting financial instruments. Pumping money into different probably doomed startups in the hope that they'll land a unicorn isn't really their style.

I'm not sure that's true. There are quite a few venture capital firms in the UK that invest in the software world.

The problem is more that, especially in the past 10 years or so, the sheer number of failures you need to absorb in order to get one success seems out of whack to the historical norm. The VC firms in the UK and rest of Europe (really, everywhere that's not California) can only afford relatively small investments for relatively large chunks of equity. To get VC firms on the scale of a16z or YC you need to have at least one mega hit, ideally several, and then you make big investments in hundreds of ropey startups in the hope that another one comes good. That's the US approach. The UK hasn't had an equivalent of a Google or Netscape that could kickstart whole new VC funds.

The past 10 years feels especially poor for non-US VC because so much money flooded into the market that there are dozens of venture backed "tech firms" for every obvious idea, so companies outside the US just get outspent into oblivion. How on earth would a UK firm have competed against Uber for example? The sums of money burned were astronomical. Blockchain firms also sucked up vast amounts of talent and capital in the UK due to its adjacency to finance, but with relatively little to show for it all.

It feels like in the era where the big US funds were made, companies were risky but still on a reasonable scale. Google/Facebook etc became profitable within a small number of years. You didn't get funds willing to pump money into firms for a decade+ with no ROI in sight.

I think this just means that the UK VCs are far far far too late. And they're late for some reason - it doesn't take insight to follow a well established trend.

Reading between the lines of his quote, my guess is he's angling for some cash from the government, by securitizing the tech sector. It won't work, because the treasury feels that spending money, like eating people, is always wrong. It won't cost any politicians anything when the bits and pieces of the UK tech sector go down the pipes, because their fortunes rest entirely on house prices, and the opinions of the fine people at Sky News. So expect another ten years of meaningless and toothless 'initiatives', sound and fury, signifying nothing, while the UK continues into another decade of death spiral.

This is the same Treasury that just had its top civil servant and minister replaced, specifically in order to allow a massive splurge of borrowing and money printing on an ahistoric scale? That Treasury?

The UK's problem is not government unwillingness to spend money. The US tech sector was primed and bootstrapped almost entirely without government money after the wall fell, and even before that it was largely independent of government funding. And there just isn't the same culture there of people expecting grants or handouts from the government - even in the cases where the US tech industry was helped by USG spending it was all via military/intelligence research projects.

> The US tech sector was primed and bootstrapped almost entirely without government money

This is mostly wrong, if you read the enterpreneurial state.

origin_path is correct. US government money (i.e., defense spending) postwar largely went into directly military-applicable areas like aircraft and missiles. Bell Labs didn't create the transistor using defense money. TI and Intel didn't create the microprocessor using defense money. In turn, the major postwar defense advances—hydrogen bomb, nuclear submarine, ICBMs, satellite recon—were all developed pre-microprocessor; only stealth technology is a post-1970 development that would probably not be possible without massive computing power. ARPANET was one of many separate networking projects being designed around the US, and the others were corporate and/or academic.

That's not to say that US tech companies did not benefit from government spending; they did. But government was a big customer, and not the magic sugar daddy without which Silicon Valley and Route 128 and the Texas Triangle would not exist.

I think the US is probably the worst model for any state to follow, because it's just so different to every other state on the planet. The UK's historical position as global hegemon pushes the UK towards maintaining institutional attitudes and policies that only make sense if you are the global superpower, and the success of the US compounds this tendency, but the problem is, the UK is a middle-size state that just has none of the inherent positional or material resources the US has, so it results in lackluster economic growth. Which is what we've seen in the post-war era.

Trying to repeat the Silicon valley, when you have none of the massive geographic and historical advantages Silicon valley had, makes no sense, and I wish the UK would stop trying to copy what it cannot be (the massive global empire) and started trying to copy what it can be (all of the dynamic middle-size economies, like SK, Germany, or even Finland).

You are missing the foreat for the trees. Everyone is always taling about companies - guess what, they are made up of individual people with skills.

All the people who built wonderfull military technology were trained on the government payroll and after the war they were avaliable for employment by corporations. Loom at how microwave was invented

>Everyone is always taling about companies

The usual claim is "Silicon Valley was created by the US military", or "Silicon Valley was created by US government contracts". That just isn't true.

Again,

>Loom at how microwave was invented

That has nothing to do with Silicon Valley. Microwave ovens were

* accidentally created during work on military microwave communications, yes, but

* it was commercialized by existing industrial and appliance companies, as opposed to new Silicon Valley startups

> the treasury feels that spending money [] is always wrong

Governments virtually always make poor tech investment decisions. It is depressing watching my New Zealand government throw away serious coin on poor technology investment decisions.

Business friendly infrastructure is fertiliser which would cause businesses to grow like weeds. Simplify government mandated interactions, and lower risks caused by unnecessary government regulations. Create simple rules for businesses to be founded. Reduce red tape in areas like payroll, insurance, tax, employment law, etcetera.

In New Zealand, government red tape is not too bad, as compared to many other countries. But it is still a heavy burden for a founder, with a lot of unnecessary requirements. The barriers need to be lowered because creating a business is hard enough without the extra burden of a bunch of government regulated crap.

I’m not saying delete all rules, I am saying prioritise rules and provide default systems that make it easy to follow necessary rules correctly. Remove needless rules and make it easy to conform to the rules; by providing good resources, providing good default software, and by having some rules staggered so that they are only applied after relevant targets are exceeded (a few years, number of employees, total revenue, whatever).

Keep the important rules, provide necessary protections for employees, provide social fallback for failure (ACC, welfare, health systems). The limited liability company was an amazing innovation a long time ago, because it removed a bunch of risks.

> It won't cost any politicians anything when the bits and pieces of the UK tech sector go down the pipes, because their fortunes rest entirely on house prices,

People want to live (and buy housing) where there are good jobs.

> People want to live (and buy housing) where there are good jobs.

That sentence is fundamental.

If demand is what is driving prices, sure. Except the government has shown time and time again there are mechanisms (e.g reducing stamp duty) that can prop up prices while demand is weak. If you look at the last few years of housing policy, you see a picture of increasingly dramatic measures to artificially inflate house prices, independent of the actual value of the houses to the people who live in them.

> the treasury feels that spending money, like eating people, is always wrong

I feel the Treasury would be more likely to hand out free soylent green than start spending money

Reading between the lines, this is actually one of the side-goals of the zombie Online Safety Bill. Require all apps with user-created content to use a UK-approved 'identity provider' for age verification, and only issue approval to a handful of home-grown companies. Et voila, a whole thriving tech /sector/ where the UK can legitimately claim to be world-leading, even if they did invent the whole thing out of whole cloth and pointlessness.

The assumptions underpinning that legislation are from about 2016. A Tory government apparently can't achieve much in six years but the Internet changed considerably. The technical mechanisms described (DNS blocking to force UK users to use UK approved sites) are no longer achievable, which means the budgetary impact goes up very considerably, for this programme which would be unpopular.

Now, if a government thinks a few decrepit Tory voters picking a new PM counts as a fresh mandate for radical economic strategies, maybe they also think a $10B pa budget line item for "Block Facebook?" is a good idea. So maybe they'll do this anyway. But it won't work.

> A Tory government apparently can't achieve much.

You could just stop there. I've yet to see, in decades of Tory rule, much but decline, neglect, and scandal. Tax cuts and service cuts. That's all everyone needs apparently. Unfortunately, labor seems so incompetent at gaining power that it seems almost like a "managed opposition." Maybe I'm being too generous to their electorate as well. The UK is a tourism attraction at this point, a historical relic found in a curio shop or flea market. Or soon will be at its current clip.

I'm afraid "it won't work" is not something British politicians care about very much, as we can see today.

I don't think there's ever been an industry created by government nationalistic policies that hasn't eventually led to stagnation of said industry

The problem is a hierarchical, deferential culture. Ex-UK countries that have been successful have thrown that yoke off - India is currently struggling to do so - and moved to a model less concerned with status and offense. Bureaucracy is great for running an empire, terrible for fostering startups.

This is the same reason the hinterlands are so neglected and Ireland hates the English so much, by the way. The caste/Eton-focused system means that power will always be concentrated in London, and newcomers are not welcome. One day it will crumble, but that day has yet to come.

For newcomers ARM cpu was/is designed in the UK ... Say nothing about Alan Turing who first conceived of how digital computation can happen using hardware then went on to help design and build one of the first computers and yes he coded it to use a Bayesian algorithm... Not to mention Thomas Bayes, De Morgan, Charles Baggage and Boole of boolean logic fame just for starters

I am neutral on the position of UK "technological sovereignty" but I don't think listing a bunch of people who died before 1900 really helps demonstrate your point.

Alan Turing didn't die before 1900. Agree he isn't exactly relevant to the question of a modern tech sector, but these examples are at least interesting for what they show isn't the problem. A comment above AtomicOrbital's argues it's to do with a "deferential, hierarchical society" and that "bureaucracy is great for running an empire". That clearly can't be the case, given that Britain churned out computing pioneers when it was at the height of its imperial power.

I think the actual reasons are a lot simpler than some imputed aspect of the British national character. Obviously, struggling to compete with US tech supremacy isn't limited to the UK. Specifically:

1. Outside the USA there's no real culture of granting equity to early stage employees. Interestingly, ARM was one of the very few exceptions. Incentivized and passionate employees are considered non-negotiable for US startups, not so elsewhere.

2. The USA and California specifically has some laws that happen to be really good for founding successful internet startups e.g. banning non-competes, at will employment, the first amendment, and so on. UK and EU have the opposite: lots of laws that make it difficult or risky.

3. The USA benefits from a large internal market with homogenous language and timezones. When British computer companies tried to expand into the USA all kinds of logistical issues got in the way of them scaling up, both in the USA and Europe. It's much easier for a company to get big in the US and then start picking off local markets one by one.

The first two problems often combine. Try setting up an employee equity scheme for a new startup in Europe. You'll find the tax systems often make it absurdly complicated or even impossible, and accountancy/legal firms are usually inexperienced with it. I'm going through this problem right now. I asked for a US style straight equity vesting scheme - no options even - and got back some wacky alternative that involves buyback clauses, contractual promises to continue granting equity even after termination for cause and contains nonsensical statements. Justification is local tax law. Sigh.

> banning non-competes

Are non-conpetes a violation of free market because they stop employees moving freely to a better job?

Or are they free market in action, becauae thats what employer and employee negotiated?

To the best of my knowledge non-conpetes are illegal in most of europe.

Good question but I'd say the former. One can imagine all sorts of 'negotiations' that restrict civilized competition which people feel forced to agree to in the moment. A free market is one in which sellers are free to compete, and buyers are free to buy. That does require various kinds of trust-busting.

Nitpick: Charles Babbage was the first to conceive digital computing in hardware - just mechanical instead of electrical.

”Charles Baggage” made me giggle a bit.

I don’t know anything about ARM, but is the IP ownership a big deal compared to the manufacturing?

My first reaction was to think I’d do everything possible to keep ARM as a domestic company, but does it even make a difference if they don’t actually produce (ex:) CPUs? I can’t run my workload on IP.

The expertise is worth something though. We’ve seen that in Canada with companies like Nortel. Once those companies are gone, the local expertise quickly follows and you become dependent on a foreign company, which is regulated by a foreign government, for part of your critical infrastructure. It’s extremely short sighted IMO and most people don’t even realize what’s being lost.

> I don’t know anything about ARM, but is the IP ownership a big deal compared to the manufacturing?

Apple manufactures nothing, all they have is IP

> but is the IP ownership a big deal compared to the manufacturing?

Yes, it is.

He's right you know.

We've waited long enough for the UK to come up with one for 40 years and the only one people can think hard enough of an example is ARM, which that has become a acquisition football by NVIDIA, Softbank and having the UK government getting involved in the ordeal. (No, Imagination Technologies is also gone before you mention that.)

So there are no credible candidates worthy for being a tech giant in the UK.

Don’t forget Autonomy for $11B which turned out to be a fraud. Herman Houser and Mike Lynch are still good friends.

Amazing how slow the wheels of justice turn for rich people. He was ruled to be extraditable in summer 2021, lost his appeal in Dec 2021, the UK Home Secretary approved it in Jan 2022, and as of Sep 2022, still has not been extradited or seen a day of prison. For crimes committed in 2011 or before!

https://en.wikipedia.org/wiki/Mike_Lynch_(businessman)

Not for everyone. I knew his CFO's wife and that guy went to jail for a bit. Entertaining stuff, for sure.

ARM and Imagination Technologies were worthy companies. They could have been giants if they had access to the kind of financial muscle that the US market provides

https://archive.ph/U6BUV

I've spoken with Hauser about this - his point (in 2012 when I had the conversation) was that the UK simply did not have access to a market big enough to support a global champion. I said (given the date) but what about the EU and he said no, because in fact the single market is fractured and filled with barriers. I asked well, what about French and German Tech companies?

Hauser looked at me and said : yes.

> I've spoken with Hauser about this - his point (in 2012 when I had the conversation) was that the UK simply did not have access to a market big enough to support a global champion.

Samsung, Hyundai/Kia, TSMC, Toyota, etc.

A lot of local brands have figured out that you can bootstrap a product locally and then just focus relentlessly on the American market, after which you can practically conquer the world.

Asian companies for some reason do this well. European companies fail horribly.

The South Korean companies that you're thinking of (Samsung, LG, Hyundai) might have had a leg-up from some friendly government policies. Check out the history of Chaebol [1] in S. Korea.

[1] https://en.wikipedia.org/wiki/Chaebol

Doesn't matter. So do the zaibatsu of Japan.

There are European companies that are just as big, in various fields, they just don't have the same mindset.

The market that they access is essentially the USA. They got allowed in for political reasons and the USA can tolerate that.

>I asked well, what about French and German Tech companies?

>Hauser looked at me and said : yes.

What does "Yes" mean?

Well, there's one large German Tech company - SAP.

But no French or British ones.

So that we can enjoy a higher standard of living and, and, and ... gasp ... be prepared to defend our democratic way of life, we need our own engineering and manufacturing workforces?! I wonder if these same politicos might suggest we should improve our K-12 education systems?

UK investment in R&D, largest ever, is £39.8 billion R&D budget for the period 2022-2025:

https://www.gov.uk/government/news/government-announces-plan...

US federal annual budget for R&D for 2022 is $180 billion:

https://ncses.nsf.gov/pubs/nsf22322

hmm. alpha fold guys were london-based, but if this is about sovereignty it doesn't matter

...just think more than thousand internet company when 2000s, they just incorporated into Google, because they are not Western company.

Every dollar you spend on an effort, moves you one decision token closer to achieving your goal.

America gave us OpenAI. The UK gave us Stable Diffusion.

I had a look into that claim. The original work and most of the research heavy lifting seems to have been done at the LMU Munich. The main British participation appears to have been Stability AI lending computing power.

https://github.com/CompVis/stable-diffusion

Don't hold back.

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