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[Music] Hello and welcome to Tech TV’s first program about data and its incredible importance in this world that we’re now in. Joining me in the studio are going to be Lord Clement Jones and Nikki Stewart. But before that, I’m going to have a little chat with Bill MW, who is uh our studio engineer, who is flying this entire thing from Portugal. We’re doing this remotely just to show how you can use technology in this day and age. Bill, data sovereignty, what is it? >> Data sovereignty isn’t a new issue. Um
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I’m showing at the moment an article I wrote back in uh 2017 a warning of the the dangers of the US cloud act at the time that it was introduced. Uh and obviously um this has been something that has actually had a massive impact on the um cloud market and the players and there’s been an ongoing uh rivalry uh between the local UK and European players and many of those uh international giants that currently dominate the market where uh much of the discussion has been around the the level of sovereignty that they provide. Um the
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the the thing that brings this to the four at this moment in time is very recently Microsoft has admitted um that they cannot provide the protection. Something that I think many of the European and UK players would have said all along um and that therefore we have a real issue around how uh any guarantees can be applied in terms of data sovereignty. Now, we saw this play out um with um the cloud market and um uh Nikki Stewart who’s joining us today and myself were both uh employees of UK cloud which is top the the the largest
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sovereign cloud provider in the UK. But during that era there was a lack of investment and a lack of prioritization on uh data sovereignty and players like that have actually now gone to the wall and the market is dominated by uh the big uh giant US cloud providers. The concern is as we move to AI, what is going to play out? Who is going to control the AI infrastructure and where are we going to stand? So hopefully Pete, this is going to provide you with uh fertile grounds for discussion today.
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Good. Well, let’s open that up then. I mean, and and let’s actually put this into perspective because people talk about things like the cloud. They talk about things like uh data uh and everybody thinks, “Oh, well, it doesn’t matter. I’ll just tick the box. Um, love Clement Jones, why is data sovereignty an issue? What is it about data sovereignty that is really exciting people at the moment? >> Well, a great deal of this is about personal privacy. I mean, if you uh and
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it’s interesting uh what Bill said because it isn’t just on the continent that there’s an issue with Microsoft. you know, the Scottish police found that they couldn’t uh uh guarantee that Microsoft couldn’t guarantee to them that data about uh criminals and crime prevention uh couldn’t be if you like exported to the states or retained in the states and be subject to the uh cloud act. So this idea that um you know uh your data can be kind of kept in the states uh and transmitted across borders
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you know is a direct violation of your personal privacy in that sense and I think that’s where most people um are nervous you know it could be worked on um uh even if you know it’s not sensitive like uh as as sensitive as uh criminal information but it’s still your personal data uh And let’s face it, we know how um you know surveillance capitalism as Shashana Zubof described it works effectively. You are the product. you are, you know, advertising is focused on you algorithmically
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um using your own personal data and you know what you’re doing is you’re giving potentially an advantage um to those who hold that data and if that data you know is held abroad uh you have no sovereign data advantage and you know I entirely agree with Bill I’m you know been following this for quite some time and I’ve been interrog ating the government but they seem oblivious um to the desiraability of having sovereign cloud capability uh you know unlike the EU which at least has been conscious about
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these issues the UK seems just simply to you know think it’s a great idea uh to have the civil service um uh use uh US cloud services. uh they uh uh uh you know don’t seem to be concerned about um anything but foreign investment. That’s for them is is their sovereign capability of having people invest in the UK. So I I think we’ve got quite a long way to go. I mean there are one or two small uh areas like uh data communities and data intermediaries where government seems to have some idea
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and maybe in due course the CMA uh will have something to say about it um uh in terms of our comp competition law but it’s a pretty gloomy forecast at the moment. >> Okay. Well Nikki, how’s this happened? I mean you’re you’re an expert on the cloud. How is it that my data has sort of evaporated and seems to have been porting its way over to the Atlantic? >> So, I think we’ve all slept walked into the cloud. Um and I think oh sort of confession time many years ago I was in
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the cabinet office leading a commercial work stream which was effectively looking at how could the UK public sector buy cloud in a way that was compliant with the procurement regulations because cloud and procurement regulations make for uneasy bedfellows at you know at the best of time and and at the time we all saw cloud as being the silver bullet solution to the problems that the government in the public sector was having with its incumbent SI suppliers where they were um you know locking government down into very long-term very
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expensive very difficult to leave contracts and and cloud was effectively being marketed as the polar opposite of that. Effectively you um paid for what you use when you need it and if you don’t need it you can just switch it off and off you go. Um and that was a huge amount of of naivity really. But cloud was seen as the silver bullet. There was um um a huge push for digital transformation um you know in public and private services. Cloud was seen as being foundational to all of that as indeed it
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was and and I’m not here to say that cloud is a bad thing. far from it that you know cloud has enabled you know many really good things that beneficial to citizens and taxpayers but the risks weren’t fully understood um so so uh the issues that the that the CMA has been looking at for the last couple of years um you know lack of technical interoperability the kind of commercial incentives that are being used um in in some cloud providers cases um you know questionable software ware licensing practices have
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have all sought to to catch um people pretty much unawares and in fact only um I think it was last month this government um published its its list of chronic risks and you know dependency on too few digital providers was one of them where it actually says that um you know 70 to 90% of the UK cloud market is now rested in only to providers. Um and and that kind of brings you on to um I think broader questions. So, so, so yes, that that there is um I think a much more acute awareness of the risks of that
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kind of concentration and particularly the the um issues around data sovereignty in the EU and there are you know a number of initiatives springing up um to attempt to address that and we can come back to those. Um, but here in the UK there seems to be almost a kind of complacency because if you look at the chronic risk analysis and there it is in black and white, yeah, our dependency on these digital platform providers is a chronic risk. What are we going to do about it? Um, we we might introduce some competitive procedures
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and the CMA is looking at it and that’s probably not good enough. >> Okay. So, what does this mean to the individual then? You know, we’re talking about the CMA, we’re talking about government organizations, we’re talking about this as a government issue, but it’s a fundamental issue for people, isn’t it, Tim? >> Yes, absolutely. And I mentioned the the question of data privacy and so on earlier on but also um you know if you have uh uh data communities, data
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intermediaries which you were very much encouraging uh where you know uh organizations, communities, groups can uh pull their data and use them uh and they could be proprietary, they could be monetized u by um for instance new AI models being developed. Um, you know, there is potential there economically for communities. Um, but they can’t do that unless we have the right kind of cloud services in my view. It has to. You have to have that kind of uh cloud sovereignty which I don’t think this
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government really has acknowledged at all. And I I’m very interested to hear of Nikki’s experience um in the cabinet office because you know my sense is that you know even though uh this issue has been raised on multiple occasions we still haven’t got the right kind of procurement arrangements um uh in government uh to make sure that they are looking you know at domestic suppliers uh particularly in this area and of course you know we all know the experience of of some UK cloud service
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prov providers uh that didn’t get government support and as a result um did not succeed and actually went bust at the end of the day. So, you know, it’s there’s a very sad story um involved in UK cloud services uh which concerns all those of us who want to see, you know, a UK um uh set of services without being dependent on the US. And of course, you know, what you haven’t mentioned so far, Pete, is this extraordinary new uh US executive order uh which really emphasizes as far as the
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US is concerned, they want total dominance uh in the technology field which is includes AI, cloud, you know, what they describe as the full technology stack and that, you know, has huge implications both for us and also, you know, uh European and countries in the EU as well. >> There you go. You just started my next question, Tim. Um, right. I mean, that’s the po that’s one of the points, isn’t it, Nikki? One of the points about this is a lot of people are saying, “Hang on,
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there is some naivity in government. The government doesn’t see we we look at things like Horizon the Horizon scandal with the post office and people are thinking the government doesn’t seem to be across technology and yet and this is coming from a government let’s face it and we we we had a gentleman called Alan Shuring who actually started off a lot of this in the first place we seem to have lost quite a substantial lead is talking about developing this homegrown industry surely we need to
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develop a homegrown an industry. >> We we certainly need to um support challenger cloud providers, not least of which is because cloud is going to be foundational to AI, to quantum computing and all the new cutting edge technologies which are coming out which are going to be huge huge gamechanging markets and and and you’re right this government is absolutely not across it. So let’s just take a look at the history of cloud consumption in in the public sector because the data is you know
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relatively easy to access. Um to date based on um cabinet office figures over 14 billion has been spent on cloud and cloud related services. Absolutely none of that has been competed. None of it has been subject to any form of competitive process. um and because it’s gone through um a vehicle called G-Cloud which relies on a a direct award process. Um at the same time, government has been locking itself into um long-term deals where they get preferential pricing in return for um certain volume commitments and those
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that preferential pricing the discount increases the more they consume. Um and and there’s always, you know, a conflict between officials who are completely cashstrapped, who are being asked to do incredibly challen you know, challenging things. Um but but they’ve got themselves into a complete mess. And in fact, there’s been quite a lot of parliamentary scrutiny of of government’s um relationship with its digital vendors, not least because the NAO issued an insight report earlier on
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this year and we had some very senior DC officials um up in front of of the PAC recently who were kind of yes, of course, just you know, spiraling out of control. Um yes um yeah we’ve got no leverage over our principal um digital vendors but we have no choice and that is absolutely where we’re going wrong here and you know I I represent the open cloud coalition. The open cloud coalition is here to say yes you have a choice and you must give yourselves a choice and the only way you’re going to
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do that is by putting competitive pressure back into this market because it’s almost non-existent at at the moment. >> Okay, Tim, how do we go about this? Ages ago, I uh interviewed a top intelligence officer who told me that he presented a paper to the Ministry of Defense. I think this was in 1996 where he was calling for borders in cyberspace. Everybody told him that he was silly. Um they were saying that’s impossible. You can’t possibly do that. But in a sense, we do need to do that. don’t we? Because
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what’s happening is your data, my data, everyone’s data is going all over the place. Microsoft has said um just recently that it it can’t guarantee that your data is going to stay in any one particular place. How are we going to do this? >> Well, you know, I absolutely agree. Um Pete, the trouble is it’s not just data. It is the full stack effectively because I do think that uh you know cloud services and data are foundational but then you know you look at dependence in other areas. I mean for instance you
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know the civil service is developing this suite of products called Humphrey. Well you look underneath the bonnet and you find that actually most of them are being built on the large language models like open AI. you look at most of the new developments in in other areas they’re you know the relationship is with Microsoft using their co-pilot um you look at the cloud services that are being provided and the AI development tools you know AWS so you know they’re all the big what they call hyperscalers
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um uh which are being depended on and you know we’ve seen what happened you saw that the senior judge in the uh ICJ in the International Court of Justice. Um Microsoft uh basically uh uh uh said that they couldn’t supply uh him any longer with their Outlook um email account. Well, you know, that demonstrates the power of big tech uh in the face of, you know, pressure on them. And so, you know, for a a senior official in an important international organization to be picked off by like that, I mean, is is a harbinger of what
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could happen in the UK government, for instance. You know, what if uh the US seriously objected to something? Well, they would put pressure on Microsoft. Uh they could terminate the use of uh of the office suite in government, for instance. As simple as that. Now, I’m not saying that’s, you know, a nearterm thing. uh it depends on the relationship no doubt at any particular moment with the US government but you know directly the US government are trying to get uh dominance in this area and they’ve
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already got a huge amount of it but they’re trying to get even more dominance which puts us at particular risk uh in terms of our use of nothing but big tech and you know that seriously worries me and that’s why I’m a big fan and this is another subject probably of open source because we need to have access to uh the source codes and so on in order not to be vulnerable. We need to have the our data held in the UK in order not to be vulnerable and we need to have our own uh cloud services,
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domestic sovereign cloud services in order not to be vulnerable, you know, and uh if everything’s held in a data center in North Virginia, uh then we’re in real trouble. >> This is one of the things, isn’t it, Nikki? Um people are talking about uh Brexit. They’re talking about Britain regaining its borders and all of these things. Um, at one point what made Britain great was that loads and loads of trade went through Liverpool. 70% of the world’s data now goes through North Virginia.
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And one of the reasons why that’s important is because that data can be used to train AI. Isn’t that the point? >> Correct. Correct. And there is, you know, amongst the tech giants a real battle going on now forum control of this arena, you know, under that um extraordinary executive order. Um I I think we come back to the kind of different responses um for example that the EU is having to these um issues versus the if you like the almost lack of response um in the UK where you look
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at the AI opportunities plan for example and yeah it mentions um sovereign AI but then it goes on to say but don’t worry you big tech giants um you’ll get most of it and and there’ll just be a little bit for the UK providers. Um part of the problem here I I think is that sovereign is is not a defined term in any sense. So you can have um sovereign which is data residency. So the data can be you know for example held in the UK or you can go through to some of the you know what might be perceived to be extreme
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hardline um sort of positions like for example that Euro stack is taking in the EU which has kind of give preferential treatment to EU providers and by the way we’ll need a 300 billion euro investment to um realize you know a full digital stack for the for Europe. Um there’s got to be a middle way here and and you you know for the OC the open cloud um coalition it comes back to choice and it comes back to you officials politicians decision makers body swerving the whole thing because they don’t believe they have a choice in
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the UK and and and they’ve partly disempowered themselves through Brexit and don’t want to have a discussion about Brexit particularly. Um so there is uh a kind of case for greater dependency on the US but unless they start supporting you challenger cloud providers, challenger AI providers by giving the right messages to the industry because we hear a lot about the investments for example that Microsoft was making um in AI that was a rishi soon act thing was um 500 billion I think that that was
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coming into the UK that was effectively for building a data center. Now, once that data center is built, right, the jobs are going to be very few. It doesn’t take many people to run a data center and most of that economic benefit is going offshore. Whereas collectively, so you know, I look at the membership of the OC, which does include global US people, but and European members and UK members. Collectively, they could make as great if if if not an even bigger investment into the UK, but many of them
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aren’t because they are simply not getting the right signals from government. And for many of them, you know, whatever the the competition and markets authority uh says in its final decision, which is absolutely imminent, won’t be any later than next Monday, will be absolutely key to um how they view the sort of viability of the UK as market because at the moment it’s it’s there is no competition. Therefore, digital growth is very limited and digital growth is kind of predicated and
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and assumed to be on US players. And you know, we’ve got to change the dynamic there and we’ve got to do it very quickly. >> Well, there’s a terrible lack of ambition here, isn’t there? One one of the things about all of this is we’re talking about the future. We’re talking about all of our futures. We’re talking about the future of economics. We’re talking about whether we have a stake in the future. What we’re sort of saying is should we allow Microsoft to invite us
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into their future? Can we make a separate future? One of the most interesting things about data sovereignty is there are these industries that are growing that are saying we can actually say where your data is. They’re trying to actually say to their customers, “Yes, you comply with GDPR, the general data protection regulations.” But so Tim, that’s something we need to do, isn’t it? This isn’t this is not a question of us just throwing our hands up in the air and saying there’s no way we can compete
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with these massive companies. Surely, this is our future. >> I entirely agree, Pete. And it’s very interesting. I mean Nikki’s talked about the AI opportunities plan, but actually it’s not joined up when you look at what government’s doing. I mean they’re putting a lot of money into what supercomputers or whatever you might call them nowadays, exa compute at Cambridge, Bristol, Edinburgh and so on. But what are they going to be using for data? What AI models are going to be
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trained on them? You know, uh there’s a sovereign AI unit in DC. what are they meant to be doing? I mean, you know, this this kind of lack of understanding. I mean, it’s really interesting that the White House document uh talks about the full technology stack because that’s exactly what we need to be concerned about in the UK. But I don’t get a feeling that you know this kind of polyanorish approach by dit to new technology adoption that they really understand that you actually have to
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have a sovereign capability in each of the different areas involved basically in AI uh uh uh development in data uh uh sets in uh supercomputee and so on and in cloud services fundamentally. So, you know, there’s a lack of understanding, I think, that this is an endto-end issue and we need to actually approach each of those areas in a very concerted kind of a way. And I must admit, I it absolutely baffles me uh why we aren’t more advanced. You know, we keep talking about wanting to become a technology
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superpower. Well, frankly, we’re way off beam if that’s uh our ambition, quite frankly. I mean this Nikki this is this is literally it’s an issue of dynamism. The the UK has not been dynamic about technology. We’ve not got excited about it. We need to be excited about it. Look at the NHS for example. The NHS has got this huge database. That is an enormously valuable database. If we could harness that, we could actually start to pay for the NHS. We could actually say with our NHS database, hey,
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give let us use your data because it’s in your interest, couldn’t we? Do do you think we need to be more ambitious about all of this? Well, it was only two or three years ago that one of the um big four accountancy firms actually put a value on the NHS database and off the top of my head I can’t remember what it was. Something like around 9 billion PA if if it was um sort of exploited correctly and by correctly I also mean safely for um the um individuals concerned. Um but but it it certainly
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from where I’m sitting it appears that nothing has happened other than um we um paid Palunteer a pound to do something and Palanteer has is is now kind of walking off with that. I’m not saying that the NHS hasn’t put in proper, you know, um, protections for individual citizens, but we we do appear to be missing a trick, um, at every single step of the game. and and and partly I the I think the attraction of being able to come out with political sound bites around the um inward investment and this
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you know catalyzes from growth from from large non-UK companies is is something that that that you know success of governments have been unable to resist. Um I will also say coming coming back to um you know the impact on citizens and individuals. Um yes we had Microsoft say under oath that it couldn’t keep data sovereign in the in in in the most I I guess sort of true version of sovereign eg the data is not subject to um any form of foreign jurisdiction but this has been going back for decades. Um so
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the late great Casper Bowen who was one of Microsoft’s um well he was Microsoft’s priv chief privacy off officer for Amir back in 2010 2011 when the Snowden scandal was at its peak briefed 40 Microsoft um or 40 countries the salespeople in 40 different countries Microsoft salespeople actually um your customer’s data is not going to be safe from um foreign for foreign intrusion um and for that he was sacked. Um so this has been a known thing for a long time but but you know we see successive governments not really
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um caring about this and in fact you know we’ve now got the data use and access act is in force and it and and it will um kind of dilute for one of a better word the um conditions under which you know foreign data transfers can be made. Anyway, >> the transparency is one of the issues that we have a real problem with. It’s almost as if we have a cultural problem with that. Uh I mean uh Nikki’s mentioned uh the palunteer issue uh which in a sense was a kind of first sign of a real problem uh about the
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transparency of awarding contracts. You know uh they got a foot in the door. We had vendor lock in uh with their foundry software which you know it does the job. it joins up and makes uh NHS data interoperable. Um but the but others could have performed that who were not American companies with the kind of reputation that Palanteer has in in various fields. Uh and now of course they’ve got the 400 million or so contract uh to do all the federated data platforms within the NHS which does not
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help with public trust. And on the transparency front, you know, we had a a proposal and copyright content is another form of data, another type of data set. You know, we had the proposal to allow big tech under the AI copyright consultation preferred option as it was uh to make sure that uh you know you had to uh that the big tech companies could use copyright content um uh without permission uh unless artists and creators had opted out. Well, they’ve now uh taken away that as the preferred
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option, but nevertheless, it’s created a huge amount of uh mistrust. And then again, when you think about the adoption of AI, particularly in places like local government, you know, there should be a countervailing duty for the ordinary citizen to be aware that it is being used. You know, I had a private members bill and this is one of my particular hobby horses um uh uh that tried to get much greater transparency when automated decision- making, algorithmic decision making if you like, which affects the
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citizen is adopted in central or local government. Well, you know, uh there was a very dusty response to that because I believe there should be a register, there should be forms of redress for the individual citizen. um uh if the AI gets it wrong uh and and so on, but there seems to be no recognition of that. So, you know, we’ve got a a real issue with transparency. Unless you get public trust, that is a hindrance to adoption. And we all want to see proper ethical adoption of AI tools because it will
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increase productivity and it may well be better. I may say this with the right data uh uh um it may be better than human decision making. So I’m not a you know I’m not a a lite I’m a tech optimist. But you can only do that if you have the right level of public trust and the right level of regulation around it at the same time. Uh my book was published last year, Pete. Um and it’s called Living with the Algorithm uh uh servant or master and it’s about AI policy and governance. So uh I’m sure
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it’ll be a good August read for everybody. a a real area that we need to to consider is exactly where we’re going with some of this. Um we it’s been around for so long. Um Nikki and and the others have referred to things that happened uh uh back in the early 2000s which were precursors to all of this. We’ve seen a UK industry come and go with UK cloud which failed to get uh uh recognized for the value it was providing in sovereignty and again we’re facing the same problems going ahead and
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what Tim has said about um the full technology stack I think is entirely right. I mean, I was at a all party parliamentary group the other day where we were talking about translation services and if you’re worried about what the police are doing, what the NHS doing, what the the the even the defense sector are doing or or the courts, um it’s even small services like this where they’re putting a a a confidential uh witness statement into a translation device which are all on American devices
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and we talked about red address there or Tim Tim really recently referred to that. Um there is no process of redress on the mass surveillance that is conducted from the US and that should be something that would keep us all concerned. But uh at the end of the day I want to thank our guests and uh ask them to to come back soon because uh we look forward to seeing them again. And um I hand back to you uh in the studio to say um thank you and um um on to the next programs in the near future. [Music]
