The UK’s fast-growing AI market, valued at over £16 billion and projected to surpass £790 billion by 2035, is undergoing a major transformation. As AI systems become more complex, the infrastructure supporting them is shifting from centralised cloud computing to distributed data centres and edge environments—placing intelligence closer to the source of data.
Lee Larter, Pre-sales Director at Dell Technologies, said this new landscape requires enterprises to adopt a data-centric infrastructure. By deploying AI tools directly into locations such as factories, hospitals and energy grids, businesses can achieve real-time decision-making and reduce reliance on centralised cloud platforms. This trend is driven in part by the rise of agentic AI—self-organising systems that operate with greater autonomy than traditional generative models. Supporting such systems demands a robust foundation of AI-optimised hardware, including GPUs, NPUs and dedicated accelerators, combined with high-speed, low-latency networking like software-defined networking (SDN).
Data management is emerging as a cornerstone of this evolution. With regulations such as GDPR, organisations must ensure data is secure, accessible and curated across diverse environments. AI systems must process data across sources efficiently while avoiding bias and safeguarding privacy. Storage infrastructure is also evolving, blending high-speed flash with tiered and hybrid cloud storage to handle the explosive growth in unstructured AI data.
As AI infrastructure expands, environmental sustainability becomes increasingly important. Energy-efficient hardware, next-generation cooling systems and real-time power monitoring are helping to reduce the ecological impact of large-scale AI deployments.
The UK government’s support is reinforcing these shifts. Backed by multi-billion-pound investments and a national AI strategy, the UK is positioning itself as the world’s third-largest AI market. Economic forecasts suggest AI could add between £550 billion and £1 trillion to the UK economy by 2035—provided adoption and skills development accelerate in tandem.
Cloud AI remains strong, with major players like Microsoft, IBM and NVIDIA continuing to drive growth. However, the rise of edge architectures suggests a hybrid future. Rather than replacing cloud systems, distributed computing adds flexibility, speed and improved data governance—essential for AI’s most demanding applications.
In this hybrid model, success will belong to those who build agile, resilient infrastructures that move intelligence to the edge. For UK businesses, that means unlocking AI’s full potential across every sector—from healthcare and manufacturing to energy and finance—while ensuring innovation is grounded in privacy, compliance and sustainability.
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