The Counterbalance | 25 September 2025
Unequal partnerships: who's really gaining from US-UK tech deal?
Earlier this month, the United Kingdom signed a wide-ranging tech deal with the United States promising over £100 billion of US Big Tech investment into British data centres, AI, and other tech infrastructure.
The deal is being sold by the UK government as a jobs and growth story, but in reality, it represents the latest entrenchment of a few giant US tech firms and their influence over the UK’s economic and political future. In addition, the deal risks weakening the UK’s ability to regulate the digital economy.
Microsoft, Google, OpenAI, Nvidia and others have announced investments tied to the agreement, including massive data centres and the largest-ever supercomputer in the UK. Accompanying these projects are promises of regulatory alignment, cooperation in evolving sectors like AI and quantum computing, as well as thousands of newly created jobs.
The outcome, however, is something potentially far more dangerous: the handover of strategic sectors to a handful of firms whose power already rivals that of governments.
“What this deal makes clear is just how much the tech broligarchy is dictating the state of play,” said the Tech Policy Press. “Vague promises of productivity gains have so far been unfounded, job creation has often been a broken promise, and the environmental toll of data centres is disastrous. What the UK actually stands to gain remains unclear.”
The core problem of course, is not investment. It is who controls said investment, who benefits from it, and who does not. The UK-US tech deal grants US giants like Amazon, Google and Microsoft — which has pledged to spend over £20 billion in the UK over the next four years — even deeper influence over how the UK develops its digital infrastructure.
The deal also reportedly may include a future roll back of the Online Safety Act, as well as digital services taxes which the UK introduced in 2020. Polling last summer found that the majority of Britons support tighter tech regulation, revealing two thirds believed social media companies should be held responsible for posts inciting riots, and 70% believed there is “much too little” regulation on tech firms.
In addition, this deal has huge ramifications for the UK’s artificial intelligence sector. The agreement between both nations includes billions of pounds worth of private investment specifically into AI infrastructure that is spearheaded by a newly dubbed “AI growth zone” in the Northeast of England. See our previous Counterbalance edition for more on The Balanced Economy Project’s concerns.
Google in particular gains a green light through the deal to invest £5 billion in the next two years to expand an existing data centre in England. A reminder from last week’s Counterbalance that another Google data centre in the UK is expected to emit over half a million tonnes of carbon dioxide per year, equivalent to roughly 500 flights from Heathrow to Malaga per week.
By partnering so closely with US Big Tech, the UK is essentially outsourcing its vision of digital infrastructure to the interests of private capital.
As economist Marianna Mazzucato — quoted in the New Economy Brief — warned, the UK’s promise of healthcare innovation, low energy bills and more growth will translate “to outsourcing more AI capacity across public institutions and the wider economy to US tech firms.”
In previous weeks The Counterbalance has looked at how Europe has wrestled with the monopolistic threat of Google and the consequences that arise for a functional EU-US relationship going forward.
A central question for European regulators has been whether they will allow Big Tech actors like Google to control the future of the sector through artificial intelligence. Given that the importance of AI will only grow in the coming years, reigning in the powers of companies like Google is more important now than it ever has been before.
Like Europe, the UK is now at the same crossroads. We saw the growing concentration of tech firms in the previous decade and failed to act.
If British lawmakers fail to regulate AI effectively today, they may never get the chance to again. If control over AI remains in the hands of a few firms, then the possibility of a fair economy — a genuinely open digital market — disappears with it both in the UK and elsewhere.
There are alternatives to this reality. The UK could mandate standards that reduce dependence on Big Tech companies. It could insist upon enforceable competition principles as part of any tech trade agreement. It could align itself with domestic innovators over the already-entrenched power of Silicon Valley.
However, doing so would require a break with the dominant (and false) assumption that deregulation drives growth, and growth can only come from getting out of Big Tech’s way. In reality, the path to a fair digital economy runs through regulation, not around it.
The Balanced Economy Project calls on the UK government to build a digital strategy that prioritises the public interest and common good over the commercial interests of foreign based monopolies, supporting UK-based tech startups to enter markets, making sure that no company can dictate the terms of the UK’s digital and financial future.
