UK risks losing AI leadership without a national data strategy, experts warn

The UK risks losing its leadership position in artificial intelligence (AI) without a clear national data center strategy, a major player in the sector has warned.

Data centers, essential for running cloud computing and artificial intelligence applications, are becoming central to the digital economy. However, without a coherent plan, the UK could fall behind in the global AI race, according to industry experts.

The UK is currently the largest data center in Europe, with over 500 data centres, the majority of which are concentrated in the south-east. These facilities are essential for everything from browsing personal devices to learning artificial intelligence, providing the power, communications, and security required to process big data.

Despite this situation, high land prices, competition for grid connections, and local resistance have created barriers to further expansion in the southeast. This has prompted some companies to explore opportunities outside the industry’s traditional base, with Kao Data starting the development of a £350m project in Stockport, Greater Manchester.

Paul Lamb, CEO of Kao Data, highlighted the importance of a broader strategy: “If we want to be part of the global AI opportunity, we need to deploy these resources in locations that are appropriate, sustainable and have the opportunity to grow.” He noted that the UK lacked a plan a decade ago when cloud computing took off, concentrating energy use across west London. Lamb called for a UK-wide data center strategy to distribute these facilities across the country.

The challenge of further expansion in the south-east is evident in places such as Abbots Langley, Hertfordshire, where a proposed data center development has sparked local debate over green belt land. The planning application was initially rejected by the local council, but Housing Minister Angela Rayner made the decision on her first day in office, signaling the government’s commitment to growth.

However, the push for more data centers has also raised concerns. Local residents and council leaders argue that development should only be allowed on green belt land if there is a significant community benefit. Stephen Giles Medhurst, chairman of Three Rivers Council, said: “We will do everything we can to say no to this development because it is an unsuitable site, causing very significant damage to the green belt.”

Kao Data’s expansion into Greater Manchester reflects a potential solution to the challenges it faces in the South East. By reusing an industrial site and leveraging existing network connections, the new facility aims to support the growing demand for AI-driven data processing. Andy Burnham, Mayor of Greater Manchester, supports the project, recognizing data centers as vital infrastructure for regional economic growth.

The UK government recently classified data centers as “critical national infrastructure”, putting them on a par with power stations and railways. However, industry experts say a more comprehensive strategy is needed to ensure the country remains competitive in AI development.

As AI becomes increasingly important to global economic growth, the UK must overcome the challenges of expanding its data center capacity while balancing environmental concerns and domestic opposition. Without decisive action, experts warn the UK could miss a key opportunity to lead the AI ​​revolution.