UK businesses brace for quantum disruption – and it could come sooner than expected

Nearly nine-in-10 UK business leaders reckon that quantum computing will disrupt their sector in the next four years, according to new research from EY.

A survey from the consultancy found banks and payments processors exploring the use of quantum to detect and prevent financial fraud and money laundering by 2030, while automotive manufacturers are testing it to help optimise electric vehicle battery development and traffic flow.

Across the board, businesses are taking the prospect seriously, with 35% saying they've made quantum computing a strategic priority for the next five years.

Among organizations operating in the financial services sector, the figure's as high as 67%, while it's far lower in real estate, hospitality, and construction firms, at just 17%.

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“Our latest report shows that, while UK businesses are continuing to invest in and evaluate the impact of quantum computing, expectations of its maturity remain cautious," said Piers Clinton-Tarestad, technology risk partner at EY UK.

"This means that although long-term disruption from quantum computing is widely expected, including its impact on cybersecurity, the proportion of companies taking immediate steps to prepare remains relatively small."

Business leaders don't see quantum computing as an immediate issue, with 59% believing the technology is unlikely to develop sufficiently to play a significant role in core operations until from 2030 onwards.

This means that talent isn't an urgent problem either, with only 13% of UK leaders planning to recruit the talent they think they will need within the next two years.

This is despite 83% seeing loss of competitive advantage as the main risk when it comes to not adopting the technology.

‘Q-Day’ predictions are evolving

While the EY survey found quantum isn’t viewed as a near-term issue, predictions over ‘Q-Day’ - the point at which quantum computers can crack traditional encryption methods - have changed in recent months.

Most estimates on this timeline have typically placed this tipping point in the mid-2030s. However, Google recently revised its timeline to 2029 and issued a warning that most organisations aren’t prepared.

In a March blog post, the tech giant said the timeline revision came in direct response to progress in quantum hardware development and quantum error connection advances.

Quantum brings new risks for enterprises

Quantum could present businesses with an array of risks and challenges, according to the EY survey, particularly with regard to outdated IT infrastructure and compliance with future regulations.

Both of these issues were cited by around eight-in-ten business leaders, for example.

The top four barriers to quantum adoption are its complexity – picked by 80% – followed by market uncertainty at 66%, integration challenges at 60% and current talent shortages at 47%.

“For some business leaders we speak to, hesitation stems from not knowing where to begin exploration. One effective first step is to identify one or two practical ways in which quantum can be used, linked to existing pain points, before assessing which teams or processes would be most affected, and any gaps in skills, tools or data," said Clinton-Tarestad.

"In the same way that an orchestra needs a conductor, effective quantum implementation needs a senior sponsor within a business with cross-functional oversight to coordinate efforts, secure resources, and help ensure quantum readiness becomes part of broader digital transformation plans.”

Another reason organizations aren't moving faster to quantum computing is a lack of clear cut use-cases, according to recent research from QuEra Computing.

Analysis from the company found that while 44% of enterprises expect quantum budgets to increase in the year ahead, even more (46%) expect them to remain flat - and 10% are expecting budget cuts.

QuEra noted that the quantum market is shifting from “hype-driven investment” to a “proof-driven discipline”, with organizations seeking clear evidence of value before committing to investment.

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