Quantum computing metaphorically left the lab in 2021 and entered public discourse amid the typical hype cycle of any emerging technology – with a funding frenzy to match. While a number of companies have claimed to be close to achieving a working quantum computer, the technology is still some way off. In addition, artificial intelligence (AI) has somewhat stolen quantum computing’s novel technology spotlight over the last year.

However, quantum computing’s potential to enact change in so many areas, including AI, is simply too great for research and investment to stop, according to GlobalData’s 2023 Thematic Intelligence Quantum Computing report. As per the research company’s deals database, the value of all deals in 2023 by the third quarter had already far exceeded that of the total investment for 2022.

While the hype around quantum computing appears to have climaxed, the technology remains top of mind for technology leaders across all business sectors. GlobalData's company filing database found that while mentions of quantum computing peaked in Q2 2022, the focus on quantum computing for many organisations remains steady.

Most estimations put quantum supremacy – the point at which quantum computers surpass classical computers in computational power and accuracy – within a timeframe ranging from five to 20 years. However, according to GlobalData's 2023 Thematic Intelligence Quantum Computing report: “Any predictions about the market in quantum computing are educated at best given its nascence and the prospect of unanticipated breakthroughs.”

And while quantum computing remains on the cusp of commercialisation, early adoption and exploration by businesses is already well underway.

What exactly is quantum computing?

Today’s classical computers are based on information stored on binary bits, which are transistors represented by either 0s or 1s. The computing power is linear and increases with the number of transistors. This means that the main limitation of classical computing is a finite level of processing power that can be held on a chip. All calculations are deterministic with the same input resulting in the same output, and all processing is carried out in sequential order.

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Instead of classic computing’s binary processing, quantum computing uses the properties of quantum physics: the counterintuitive behaviour of subatomic particles that results in the quantum states of superposition and entanglement. Quantum computing bits are called qubits and have the ability to represent 0 and 1 simultaneously. By increasing qubits, the computational power grows exponentially, not linearly.

For example, think about the problem of finding a way out of a complex maze where there are millions of possible exit routes. A classical computer using binary processing would check each escape route one after the other in a linear manner until it found a correct solution.

A quantum computer, on the other hand, would test all possible escape routes simultaneously and come up with a solution in a fraction of the time. This means the theoretical limits of quantum computing are endless and its computational power is in order of magnitudes greater than classical computing. According to IBM, if you wanted to find one item in a list of one trillion and each item took one microsecond to check, a classical computer would take a week to complete this task versus only a second for a quantum computer.

How will quantum computing change businesses?

Despite the incredible scientific breakthroughs of the last 100 years, we still don’t really understand how vast swathes of our world works, including our own bodies. Quantum computing has the potential to address these myriad gaps on a granular level as never before.

This novel technology has the potential to create whole new families of drugs and diagnostic processes, new industrial and chemical processes, new ways to address climate change, new methods of logistics and transport, advanced space exploration, surveillance and monitoring… the list goes on.

Potential applications include:

  • Pharmaceutical industry: drug discovery, disease diagnostics and personalised medicine through gene sequencing and analysis
  • Optimisation problems: supply chain logistics, delivery fleet optimisation, mapping, traffic/air traffic control and transport systems
  • Climate change: forecasting, climate modelling and carbon capture technologies (the UK Met Office is already investing in quantum computing to help improve weather forecasting)
  • Financial services: forecasting financial risk with complex financial modelling
    machine learning: the convergence of quantum computing and artificial intelligence (AI) has the potential to be a game changer. The ability to analyse huge quantities of data using quantum computing will provide the information needed for high-performance AI.

Indeed, there have been suggestions that quantum computing could optimise how AIs learn in large language models in order to make AI more effective, according to GlobalData principal analyst Steven Schuchart.

Schuchart cites examples of doing deep work on combinatorial optimisation such as traffic and road optimisation problems as well as many other real-world problems in this category.

"Quantum computing could, in theory, do the heavy lifting portions of these problems and have them available for AIs to use as part of the basis of solutions offered to the end user," according to Schuchart.

This optimisation scenario would involve AIs working in tandem with quantum computers for on-demand results. But that is a very long way down the road, says Schuchart, far beyond quantum supremacy, as that capability would require volume availability of quantum computing to bring the costs down to an acceptable level.

Where is quantum computing's global centre of gravity?

The US and China are locked in a battle for global quantum supremacy. The US launched its National Quantum Initiative in 2019, pledging $1.2bn over five years. In 2020, the White House Office of Science and Technology Policy, together with the National Science Foundation and the Department of Energy, announced a fund of $1bn to establish 12 AI and quantum information science research centres nationwide.

Similarly, in 2016, China’s 13th five-year national strategy included the aspiration to become the pre-eminent global quantum computing and communication superpower. Indeed, China leads in quantum communications via satellites and long-path optical fibres, launching the world’s first quantum satellite, Micius, in 2016. China is also building a Quantum Information Sciences National Laboratory with initial funding of $1bn.

While the US and China lead the sector, the UK punches above its weight as a quantum computing pioneer nation. The National Quantum Technology Programme (NQTP) was established in 2013 with an estimated public and private sector investment of £1bn by 2024, according to the NQTP’s 2020 strategic intent report. Promising start-ups include Cambridge Quantum Computing and Oxford Quantum Circuits, with a major sector hub evolving around Oxford University.

In March 2023, the UK Government increased its investment commitment to £2.5bn to commercialise and develop quantum technologies over the next decade in order to become a world leader in quantum computing.

Quantum threats and challenges

For all the potential advantages, the technology still has many hurdles to clear. Even when quantum computers become ready for market, they will still prohibitively expensive for most companies or organisations to own. For now, exploration is taking place in the cloud with quantum computing-as-a-service emerging as the preferred way to access the technology.

Common standards are still being worked out and possible qubit architectures are still in formation (with five main quantum computing architectures in contention). These various methods are being used by start-ups and tech giants alike and most look promising, but none have dominated the market, so far.

For example, Google is leading in the area of superconducting qubits, Silicon Valley based start-up PsiQuantum is pioneering photonic qubits and both Oxford Ionics and Quantinuum (formerly UK start-up Cambridge Quantum Computing) use trapped ion qubits. No matter the qubit architecture, until the high error rates in quantum computing outcomes are fixed, the technology will not be widely applied to real-world problems.

Quantum computing companies are also struggling to attract and retain talent, and this will be a significant future challenge for the sector.

The greatest risk quantum technology poses is its potential to decode all current cryptography. Businesses need to become alert to the security risks that are likely to ensue with quantum supremacy. However, according to the Global Risk Institute, it will be at least ten years before such attacks are feasible.

While most industry insiders believe quantum supremacy will be achieved within a decade, public perception of the risk timeline is somewhat out of step and therefore businesses are lagging on mitigating potential risks. A survey from the Global Risk Institute assessing the quantum risk timeline found that 90% of respondents indicated the quantum threat timeline was nearer the 20-year mark.

GlobalData’s prediction of five years for quantum supremacy may be optimistic but nevertheless comes with caveats. Even when the hardware and software are available, businesses still need to know how to use quantum computing and understand that it may not be a panacea for business problems.

The pessimistic outlook is that quantum supremacy is still a decade or two in the making. But according to GlobalData there is room for optimism. "Researchers are still finding new ways to actually do quantum computing, beyond superconductive, trapped ion and quantum annealing. New methods are being tested, including silicon photonic light-based qubits, neutral atom qubits, and silicon spin, just to name a few," according to Schuchart.

Nevertheless, the market size alone demonstrates a consensus that quantum computing will be a pivotal technology when it achieves maturation. GlobaData estimates the market size to have been valued somewhere between $500m-$1bn in 2022. The research company predicts this will reach $10bn between 2026-2030, representing a compound annual growth rate of between 30%-50%.

No business needs to have a quantum computer just yet, but early-mover exploration is accessible in the cloud and it is time for enterprise technology professionals to start thinking about the possibilities. According to Schuchart, quantum computing is still very much a work in progress. "But it is interesting and exciting progress that will expand the totality of human knowledge regardless of when quantum computing supremacy and scale happen," he adds.