Summary

The Department for Science, Innovation and Technology (DSIT) engaged Deecon to conduct an in-depth study of the UK’s Advanced Connectivity Technologies (ACT) sector, building on earlier market scoping work.

The Requirement

DSIT commissioned Deecon to deliver a comprehensive assessment of the UK ACT sector. The project required mixed-methods analysis across a complex and rapidly evolving landscape, spanning multiple technologies, market dynamics, workforce and skills, and economic contribution.

The Solution

Delivery was challenged by fragmented data sources, a reliance on stakeholder engagement for primary research, and tight timelines with milestone-driven outputs. Deecon addressed this through structured governance, extensive stakeholder engagement (including surveys and expert interviews), and robust analytical methods to build a consistent, evidence-based view of the sector.

Deecon began by using its subject matter expertise to develop a refined definition of ACT, supported by a tiering framework to classify technologies based on maturity and strategic relevance. This enabled more targeted evaluation of investment priorities and sector focus.

The project was delivered across four structured phases, each with defined milestones and outputs:

Project mobilisation
Data collection and analysis
Report creation
Report completion and handover

Weekly meetings with the core DSIT stakeholder ensured continuous alignment and direction, supported by regular steering groups with policy leads across the technology stack to refine outputs and validate findings throughout the engagement.

The Results

Deecon identified 501 ACT companies operating in the UK, representing around 4% of the wider telecommunications base, with 64% focused solely on ACT and 36% operating across broader portfolios. The study quantified the sector's economic contribution, estimating £32.9 billion in revenue and £13.2 billion in Gross Value Added (GVA) in 2025, with approximately 109,400 employees, highly concentrated among the largest firms.

The study also highlighted geographic concentration, with 54% of ACT companies located in London and the South East, and employment even more concentrated in these regions. It identified key workforce challenges, including a limited undergraduate pipeline, a postgraduate talent pool heavily reliant on international students (68%), and an anticipated 30,000-person engineering shortfall over the next 10 years.

On investment, the study analysed sector dynamics, identifying approximately £140 million in grant funding (2018–2026) and over £300 million in equity funding (2022–2025), with challenges identified in later-stage financing for capital-intensive ACT firms. Looking ahead, the study forecast UK ACT revenue reaching £62.8 billion by 2031, with strong growth projected in Private Enterprise Networks (+£1.7 billion) and high-growth technologies including LiFi and VLEO systems, each forecast at over 45% CAGR.

The study was published by DSIT on gov.uk in June 2026 and subsequently cited directly in DSIT's Digital and Technologies Sector Plan: Year One Update - published with a Ministerial Foreword from Lord Vallance, Minister of State for Science, Innovation and Technology - which drew on the study's figures for employment and growth to report on progress against frontier technology commitments.