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Business & Economy

Close to the edge – bridging the digital transformation divide in the North East

The North East and its hinterland have many economic advantages, including an enthusiastic and often highly-skilled workforce, and a low-cost base, writes Simon Michie, chief technology officer at Newcastle-based Pulsant.

But the region’s rejuvenation risks being undermined by the continuing North-South divide when it comes to the data connectivity and speed required for edge computing – the next major evolution of business.

Edge computing will trigger a revolution in commerce, healthcare and government. It will facilitate the vast expansion of the Internet of Things (IoT) and exploit the full potential of 5G roll-out, enabling higher levels of automation and efficiency in industry and agriculture, remote diagnostics, treatment in medicine, interactive gaming and autonomous vehicles.

It makes these advances possible through faster analysis of data, locating processing and storage closer to where it is collected rather than sending it to a centralised location.

There are various configurations of edge computing, but the essential requirement is to process and analyse data closer to the end-user.

The gap between North and South

This places a high premium on proximity to a data centre and fast, high-bandwidth connectivity.

While many businesses speak highly of the current state of connectivity in the North East, a Pulsant survey of 202 business leaders at mid-sized companies last year found only 13 per cent thought their location was an advantage when it came to fulfilling their digital transformation plans.

Compare this with London and the South East, where the same survey found 62 per cent thought their location to be advantageous to their digital ambitions.

In the North East, by contrast, six-in-ten businesses report that obtaining reliable IT infrastructure is difficult because of where they are.

The findings illustrate how the capital city and the South East retain significant advantages when it comes to connectivity with the vast storage and computing power of cloud.


Simon Michie, chief technology officer at Newcastle-based Pulsant


Not only does the region have access to greater speed, capacity and more interconnections, the wider choice of carriers and networks provides higher resilience.

Companies in the South East also have easier access to IT and data science talent, along with specialist services.

These are definite pluses for ambitious organisations that want to become truly data-driven and move their applications into the cloud or shift to software-as-a-service (SaaS) models.

Connectivity meets the current needs of digitally ambitious businesses in the North East

This state of affairs is not currently damaging businesses in the North East, however. Why else would companies from mobile-first Atom Bank to Sage, Nissan, Arriva, Greggs and Sabic choose it as a location?

Schemes such as the £290 million NewcastleGateshead Quays regeneration scheme or the £145 million programme for County Durham are in progress, along with the huge 4500-acre freeport scheme further south on Teesside.

Such initiatives and the best efforts of investment agencies such as Invest North East England help dispel the old clichés about the post-industrial North East.

And when it comes to accelerating transformation, businesses in the North are not only ambitious, but they are also ahead of the South.

The research found 67 per cent of medium-sized businesses in the North plan new SaaS applications, are migrating traditional workloads and data into the cloud (65 per cent) and are creating their cloud-native applications (65 per cent).

This is faster than any other region.

The North East shares this appetite for transformational digital advances, which will create further new business opportunities and help ease concerns among professionals over access to the right talent compared to the South (69 per cent).

Eight-in-ten businesses in the North East are deploying SaaS applications, compared with 59 per cent for England as a whole. More than two-thirds of businesses in the North put improvements in customer experience at the top of their aims for digital transformation.

The imperative to get ready for the edge

This is excellent news, but the North East now needs to more fully prepare for edge computing.

The high-speed, resilient and secure access that is fundamental to edge computing can only be provided by a genuinely national network of regional data centres connected by high-performance fibre, bridging the gap between local businesses and the major cloud vendors and centralised platforms.

Only through a high-speed network of data centres can organisations in the North East embrace edge.



Despite the distance from the major cloud vendors’ connectivity in the South East, some promising developments will open up the edge for businesses in Tyneside, Wearside and the hinterland.

Edge networks are already expanding. With data centre development previously focused on the capital, hybrid cloud and colocation providers are making significant investments in national edge computing infrastructure, including Newcastle.

The essential high-speed, ‘low-latency’ connectivity is supplied by a high-performance fibre network.

The advantage for businesses is that it opens the door to high-capacity, agile connections from any location.

Organisations with a headquarters, office or warehouse in almost any part of the North East will have full access to advanced computing and applications.

They will be able to provide transformed customer experiences and embed sophisticated automation as part of their digital transformation ambitions.

Be certain it is the real edge your business is getting

It’s clear that while the North-South divide certainly persists when it comes to connectivity and potential for edge computing, the gap need not be as heavily weighted in the South’s favour as some may fear.

Businesses and other organisations in the North East are bold and ambitious in their digital ambitions and edge computing platforms are emerging to meet their needs and supercharge performance, opening the gateway to new services and business models.

Organisations undergoing digital transformation and seeking to ready themselves for the era of edge computing must have access to genuinely fast, resilient and high-bandwidth connectivity.

All organisations should be wary of what is in effect phoney edge computing technology, which cobbles together existing data centres with poor connectivity.

Just because a data centre is close by does not mean it is part of a resilient national edge network with the capability to re-route traffic and provide seamless, continual connectivity in the event of an outage or interruption occasioned by third-parties or external events.

Wherever they are in the region, businesses with ambitions to create new services and improve performance through edge adoption must be canny about the configuration and providers they choose.

The alternative could result in a continuance of a damaging digital divide.

Once organisations have access to the true edge, it will transform how they operate and provide the region with the major economic advances it deserves.

Far from perpetuating a technology divide, it will ensure businesses are not out on a limb but are firmly on the digital map.