Electronics and IT Hardware in the UK: investment opportunities
Published 20 February 2014
© Crown copyright 2014
This publication is licensed under the terms of the Open Government Licence v3.0 except where otherwise stated. To view this licence, visit nationalarchives.gov.uk/doc/open-government-licence/version/3 or write to the Information Policy Team, The National Archives, Kew, London TW9 4DU, or email: psi@nationalarchives.gov.uk.
Where we have identified any third party copyright information you will need to obtain permission from the copyright holders concerned.
This publication is available at https://www.gov.uk/government/publications/electronics-and-it-hardware-in-the-uk-investment-opportunities/electronics-and-it-hardware-in-the-uk-investment-opportunities
1. Electronics
The electronics sector is worth £16 billion every year to the UK economy. With about 300,000 people in over 12,000 companies the industry has a:
- strong intellectual property rights (IPR) framework and legal system
- established intellectual property rights development
- ability to quickly introduce products to the market
- big software sector
- research community involving academia, companies, and industry groups
2. Consumer electronics
The UK is the largest European market for high-end consumer electronics products with about 18,000 UK based companies. Products developed include:
- HD TVs
- Blu-Ray and DVD Players
- MP3 players
- mobile phones
- games consoles
The consumer electronics retail sector will grow faster than any other UK retail sector up to 2015, with average annual growth of 4.4%. The market offers opportunities across the supply chain.
3. Power electronics
The UK’s strength and future opportunities for power electronics are in 4 main areas:
- transport
- energy generation
- transmission and distribution
- consumer electronics
Power electronics is important for the power supply infrastructure and the energy smart grid which links the source of energy generation to end users.
Read the UK Power Electronics Strategy
Read about opportunities in the energy network sector.
4. Semiconductors and electronic design
The UK has a 40% share of Europe’s electronics design industry. Companies such as Arm have helped establish the UK as an important contributor for semiconductor design.
The UK has expertise in a number of areas including:
- integrated circuits (ICs)
- optoelectronics and radio frequency (RF) devices such as monolithic microwave integrated circuit (MMIC)
- electronic components
Most of the world’s largest semiconductor companies have design, support or manufacturing operations in the UK. Start-up companies are developing and marketing semiconductor intellectual property (IP) and many are growing by doing business around the world.
There are some technology areas which provide help to the industry including:
- embedded microprocessor design
- wireless
- analogue
- systems integration and interoperability
- new semiconductor techniques and materials
4.1 Design
The UK has 150 independent electronic system design houses, more than any other European country. These are aided by design tool vendors such as Electronic Design Automation (EDA) and Computer Aided Design (CAD) being in the UK. The UK also has test and validation houses able to assess products during design. This ensures compliance of finished products before shipment.
4.2 Medical electronics
There are over 3,000 companies in the UK medical devices sector, with a turnover of over £13 billion. The National Audit Office estimates that the National Health Service (NHS) will be replacing 80% of its machinery between 2012 and 2017, creating supply opportunities for companies.
Read about opportunities in the medical technologies sector.
4.3 Communications
The UK has the largest personal communications market in Europe. Communications made up 20% of the total European semiconductor industry in 2010.
Read about opportunities in the communications sector.
4.4 Automotive electronics
The automotive market accounted for 22% of the total European semiconductor industry in 2010. The UK is one of 5 major automotive manufacturing countries in Europe, producing over 1 million vehicles and more than 2 million engines annually.
Read about opportunities in the automotive sector.
4.5 Defence electronics
UK government and military purchases accounted for 1% of the total European semiconductor market in 2010. The UK is the second largest defence exporter in the world.
4.6 Security electronics
The UK is the world’s largest market for intelligent transport systems (ITS) and surveillance related technologies. It has over over 25% of the worlds CCTV installations in the UK.
5. Energy efficient lighting and displays
The UK commercial and domestic lighting market is worth around £1 billion and more than 1,700 companies work in the lighting supply chain. The UK has a sophisticated network to aid the development of new energy efficient lighting products and technologies.
6. Research and development (R&D)
The UK’s companies, clusters, research institutions, networks and associations all work together on research and development. This is done through various research programmes focusing on semiconductor technologies for silicon and newer semiconductor materials
7. Employment skills
The UK is home to 3 of the world’s top 10 Technology and Engineering universities. A number of universities offer courses linked to the consumer electronics sector.
Almost 50,000 students in the UK were studying for degrees in consumer electronics related subjects in 2011/12. Last year, about 11,000 students graduated with electronics related degrees.
Higher and Further Educational institutes also provide a range of courses for students interested in the semiconductor and electronic design industry.
8. International companies in the UK
Large international companies including LG, Samsung and Sony have their industrial design centres in the UK. Many companies use third party electronic design houses in the UK to manufacture their hardware.
More than 500 semiconductor businesses are in the UK. 80% of these are foreign owned companies that employ more than 8,000 engineering staff.
Major global semiconductor and electronic design companies have already established operations in the UK including:
- ARM
- NVIDIA
- CSR
- Wolfson
- Intel
9. UK government support
The UK government is committed to working closely with companies, industry associations and research centres to make sure the UK is the best place for businesses. There are a number of initiatives to help companies including:
- SMART programme providing funding to assist UK based Small Medium Enterprises (SMEs) working on projects
- Patent Box scheme to reduce the amount of corporation tax paid on profits from patents and intellectual property (IP) registered in the UK
10. Industry associations
10.1 techUK
techUK is the leading trade association for members from the information and communications technologies, electronics manufacturing and design, and consumer electronics sectors.
10.2 ICT Knowledge Transfer Network (KTN)
The ICT KTN seeks to bring competitive advantage to the UK by promoting collaboration and knowledge sharing between the users and providers of ICT.
10.3 The Electronics, Sensors and Photonics (ESP) Knowledge Transfer Network (KTN)
The ESP KTN spans the technologies underpinning devices, tools and technologies that are taken for granted today.
10.4 Silicon South West
Silicon South West is a network organisation which provides regular networking events, news and national and international promotion for the South West region’s microelectronics cluster.
10.5 Cambridge Wireless
Cambridge Wirelesses’ main aim is to promote networking in the wireless sector. Its activities are based around a number of Special Interest Groups (SIGs), each focussed on a specific technology or market area.
10.6 National Microelectronics Institute (NMI)
The NMI is the trade association representing the semiconductor industry in the UK and Ireland. The NMI has a membership that spans the supply chain and includes fabless semiconductor manufacturers, IDMs, foundries, design services, IP providers, EDA tool providers, research and academic institutions and the wider stakeholder community.
10.7 The Institute of Engineering and Technology (IET)
The IET (http://www.theiet.org) has more than 150,000 members in 127 countries and offices in Europe, North America and Asia-Pacific. The IET provides a global knowledge network for the exchange of ideas and to promote the positive role of science, engineering and technology in the world.
10.8 Gambica
Gambica is the national organisation representing the interests of companies in the instrumentation, control, automation and laboratory technology industry in the UK.
11. Locations
There are different locations across the UK known as Enterprise Zones that offer investors incentives to locate themselves there including:
- reduced taxes
- simpler planning rules
- financial benefits
Many Enterprise Zones have employment clusters, where businesses from the same sector are located in the same zones.
12. Contact Department for International Trade (DIT) for help
DIT can provide overseas companies and investors with more information about opportunities in the UK’s oil and gas market.
Enquiries for overseas companies looking to set up in the UK
Email enquiries@ukti-invest.com
Contact form https://www.contactus....
Telephone: +44 (0)207 000 9012
Overseas companies can contact the Investment Services Team for information about setting up in the UK including the help that is available.