The UK tech sector achieved its best year to date in 2021, creating a record number of unicorns, forming more futurecorns and increasing venture capital investment. With a 2.3-fold increase in start-ups and scale-ups in 2021 compared with the previous year, raising an impressive £29.4 billion in investment, the UK tech sector claimed a third of the total £89.5 billion of investment that flowed through the European tech ecosystem that year.
Critical to productivity, growth and job creation in the UK and beyond, the tech industry accounts for approximately 1 in 8 of all open roles in the UK. The tech sector’s rapid rise inarguably creates vast socio-economic opportunities.
However, it is crucial that this growth takes place in a safe and responsible way.
For several years now, the pervasive nature of innovative technologies has been a cause for concern. In 2018, data privacy issues came to the fore in the wake of the Cambridge Analytica scandal, when it emerged that the personal data of millions of Facebook users had been collected by a consulting firm without user consent.
This personal data was then used in both the US presidential campaigns of 2016 and the Brexit referendum in the UK. Following the wholescale rise in implementation of digital assistant technology, suspicions have also been raised regarding voice-activated devices listening into conversations, with the increased prevalence of artificial intelligence only adding to these concerns.
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Experts warn that the presiding patchwork of privacy laws and self-regulation of the industry lacks coherence and transparency, failing to go far enough in terms of protecting both customers and competitors operating in the industry.
Over the past decade, tech giants have established themselves as the world’s most valuable companies, all while operating with precious little formal oversight from government agencies. Experts warn that this lack of oversight has come at a cost, effectively driving up the cost of innovation.
Critics warn that today’s privacy laws and regulations fail to go far enough to protect the billions of consumers who use these tech companies globally. In addition, there are significant concerns that a combined lack of coherence and transparency culminates in a market environment that fails to encourage innovation and healthy competition.
In order to put tech companies on a level playing field with each other and competitors in regulated industries, there are calls for governments to introduce regulatory systems for tech industries in their respective countries.
Creating a regulatory regime with clearly defined rules of engagement and nationwide statutes would effectively drive down the cost of innovation, while simultaneously holding companies accountable for abuses of their intentions, ranging from harmful acts like facilitating the spread of fake news to sharing user data.
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A prominent figure in the tech sector, Roman Semiokhin is a businessman and philanthropist whose love for IT became evident at an early age. A passion for computers led him to launch a computer club, followed by several tech-focussed businesses.
As Roman Semiokhin will appreciate, regulation is crucial to protect the tech sector’s future, providing the right framework for the industry to flourish.