(qlmbusinessnews.com . Wed 17th Sep, 2025) London, UK —
UK's AI Revolution: A $31bn Tech Pact with Nvidia, Google, and Microsoft
Microsoft has announced a landmark investment of $30bn (£22bn) into the UK's artificial intelligence (AI) sector, making it the company's largest commitment outside the United States. This investment is expected to significantly bolster Britain's economy over the coming years.
This commitment is part of a larger £31bn pact between the UK government and several major US technology companies, including Nvidia and Google, aimed at enhancing British infrastructure to support AI technologies, primarily through the development of data centres.
Moreover, Microsoft is set to take part in the establishment of a cutting-edge supercomputer in Loughton, Essex.
In an exclusive interview with the Reporters, Microsoft CEO Satya Nadella shared his optimism about the technology's potential to stimulate economic growth. “It may happen faster, so our hope is not ten years but maybe five,” he stated, emphasising his desire to see AI's impact reflected in economic and GDP growth.
Prime Minister Sir Keir Starmer hailed the US-UK deal as marking “a generational step change in our relationship with the US,” highlighting its role in creating highly skilled jobs, increasing people's income, and ensuring the partnership's benefits extend across the entirety of the United Kingdom.
Despite the UK economy's recent sluggish performance, Nadella drew parallels between AI's economic potential and the transformative impact of the personal computer on workplaces in the 1990s. However, he also cautioned against both over-hyping and underestimating AI, noting that while technology cycles include booms, busts, and bubbles, AI promises to introduce new products, systems, and infrastructure.
Acknowledging AI's significant energy demands, Nadella argued its benefits, especially in healthcare, public services, and business productivity, justify the investment in data centres, which he deemed an investment in modernising the power grid. However, he did not suggest that this investment would be directly shared with the National Grid, the UK’s power supplier, prompting concerns from the campaign group Foxglove about the UK potentially bearing the cost of the technology giants' power needs.
The announcement of the supercomputer in Loughton, Essex, which the government had previously disclosed in January, gains new momentum with Microsoft's involvement.
The revelation coincides with former US President Donald Trump's three-day state visit to the UK, during which a “Tech Prosperity Deal” aimed at fortifying ties in AI, quantum computing, and nuclear power was signed. This deal also includes Google's £5bn commitment to AI research and Nvidia's pledge to power innovation and economic growth, with a proposed £11bn investment in the UK's AI infrastructure.
UK Chancellor Rachel Reeves inaugurated a £735m data centre in Hertfordshire as part of this investment initiative. Concerns linger, however, regarding the UK's dependence on foreign technology due to this substantial influx of US capital.
Satya Nadella underscored the agreement as heralding “the next phase of globalisation,” asserting that access to foreign tech services enhances rather than undermines digital sovereignty.
On the topic of AI's impact on employment, Nadella highlighted Microsoft's adaptability to technological shifts, referencing the company's recent layoffs amidst record sales and profits as part of a “hard process of renewal.”
The government has also spotlighted north-east England as a new “AI growth zone,” promising over 5,000 jobs and substantial private investment. This initiative builds on last year's announcement of a £10bn investment in a data centre near Blyth, Northumberland, and introduces another project, Stargate UK, involving OpenAI, Nvidia, Arm, and Nscale at Cobalt Park in Northumberland.
While the UK's embrace of these significant investments signals a positive outlook, experts and institutions like the Tony Blair Institute for Global Change and the Computer & Communications Industry Association recognise the challenges ahead in harnessing AI's full potential for the UK's economic benefit.
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