The UK has the potential to play a significant role in the artificial intelligence (AI) market, particularly in the production of computer chips, which are vital for AI technologies. A well-coordinated national effort could enable the UK to meet up to 5% of global chip demand.
The UK has a strong legacy in chip design, having pioneered various technologies, including the first general-purpose electronic computer and the first parallel computer. Today, Arm, based in Cambridge, designs over 90% of the chips used in mobile devices worldwide. Given this background, securing a notable share of the AI chip market, projected to reach $700 billion by 2033, could be feasible. Achieving a 5% market share would translate to approximately $35 billion in revenue and the creation of thousands of jobs.
The AI sector is reshaping economic and societal structures, with chips emerging as essential components driving advancements in all AI applications. Industry leaders like Nvidia dominate the chip market by supplying the high-performance components necessary for AI capabilities.
Concerns have been raised about potential competition from China, particularly regarding the commoditization of AI chips. However, U.S. export controls prevent China from accessing advanced chip manufacturing technologies for the next decade. This limitation could provide opportunities for the UK as an ally of the U.S. in chip design.
While the UK hosts several emerging companies in the chip sector, such as Fractile and Flux, scaling these operations to meet global demands remains a challenge. The focus could shift towards specialized applications in sectors like robotics, factory automation, and autonomous vehicles.
For the UK to capitalize on this opportunity, several strategies are proposed: stronger government support for chip design, expanding the workforce in this field, leveraging investment funds, and fostering partnerships with leading U.S. chip manufacturers. If effectively implemented, these measures could enable the UK to leave a significant mark on the future of AI and chip technology.
Source: https://www.theguardian.com/technology/2025/nov/13/uk-firms-can-win-significant-chunk-ai-chip-market