Safeguarding podcast – The UK as a World Leader in SafetyTech

In this safeguarding podcast we discuss with Director of Perspective Economics Sam Donaldson, the DCMS sponsored inaugural report on the UK SafetyTech industry. Forwarded by Caroline Dinenage, the Minister of State for Digital and Culture, the report defines SafetyTech and explores its aims and ambitions, its funding, value and growth. Who are the major players, what’s driving the demand for SafetyTech solutions and will we see a British SafetyTech unicorn?

There’s a lightly edited transcript below for those that can’t use podcasts, or for those that simply prefer to read.

Neil Fairbrother

Welcome to another edition of the SafeToNet Foundation’s safeguarding podcast hosted by me, Neil Fairbrother, where we talk about all things to do with safeguarding children in the online digital context.

Child safeguarding in the online digital context is at the intersection of technology, law, and ethics and culture and it encompasses all stakeholders between the child using a smartphone and the content or person online that they are interacting with.

Ernie Allen, Chair of the WeProtect Global Alliance, said that online child abuse is a technical problem that can be solved with technology. There are many technical aspects to this though; there isn’t a single technological silver bullet and to help us guide us through what he calls the “SafetyTech” industry in the UK, I’m joined by Perspective Economics’ researcher Sam Donaldson. Welcome to the podcast, Sam.

Sam Donaldson, Perspective Economics

Thanks for having me.

Neil Fairbrother

My pleasure. Sam, could you give us a brief resumé of yourself please Sam? Tell us perhaps who Perspective Economics is.

Sam Donaldson, Perspective Economics

Sure, absolutely. So I’m Sam Donaldson. I’m a Director with Perspective Economics. Just to give a little bit of background, I’ve been an economist for several years, working to identify the market contribution and market scoping of a number of emerging tech sectors across the UK. So over recent years we’ve done a lot of research looking at the economic contribution that the size, the scale of sectors such as cybersecurity, health tech, industrial biotechnology and within this most recent report, seeking to define the measure of the economic contribution of SafetyTech to the UK.

Prospective economics, we’re a relatively new firm, we set up a couple of years ago, myself and on a few historical colleagues and really our bread and butter is trying to identify the economic contribution technological contribution of a number of emerging industries and emerging sectors. So we were delighted to have been appointed by DCMS six months ago to deliver a piece of research looking to define, measure and set out the SafetyTech industry in the UK.

Neil Fairbrother

So well done on winning the commission to produce the report. As you say, DCMS has commissioned the report and it’s forwarded by Caroline Dinenage, the Minister of State for Digital and Culture. What are her views? What does she say in her forward?

Sam Donaldson, Perspective Economics

Yeah, so I think that the main emphasis within this report, something that we’re very much keen to flag is that this is the very first sector study looking at SafetyTech within the UK, so this is a very much a landmark study. As far as we’re aware, it’s the first study internationally to actually identify what’s in scope when thinking about SafetyTech and how to measure who the companies are and what they contribute to the economy, but also what they contribute in terms of actually keeping children and vulnerable users safer online.

I think this reflected by our research and that’s certainly something that’s been very much of interest from the DCMS side is that really this report shows that the UK is very much a global leader when it comes to improving online safety. So there is a history of over 20 years of expertise in the UK when it comes to a number of solutions, technical solutions that are offered with respect to SafetyTech.

I think our report and the Minister for State also sets out that really within the last number of years there’s been a number of key technical breakthroughs and a number of key innovations that the SafetyTech sector has shown; very much around things like content moderation, using artificial intelligence, machine learning to really better identify how to tackle some of the issues of online harms. And I think when it comes also to the economic contribution of this sector, what’s really promising and we’re very glad that the Minister has picked up upon this, is that the UK is home to a number of encouraging [solutions] right across the breadth of the UK.

So we’ve seen a number of key providers, not only in London but in hubs such as Edinburgh and Leeds, really showing that this industry is very much dispersed across the UK and is expected to grow considerably across the UK. And really, as we expect from the economic research, this is very much a sector that is going to grow strength to strength in the future.

Neil Fairbrother

Okay. What is the SafetyTech industry? How do you define it?

Sam Donaldson, Perspective Economics

So I’m glad you asked that question. So again, whenever this research started off, this was a question that we very much had to grapple with, what actually is included when thinking about SafetyTech and some of the tech providers? Now the definition that we have proposed for this piece of research was that SafetyTech providers are those that, very much alluding to your first point, they develop technology or solutions to facilitate safer online experiences, to protect users from harmful content, contact or conduct.

So this is very much different from cybersecurity that might be more focused on protecting systems, this is very much about protecting users, protecting people. What we found, whenever you’re trying to define safety tech and define what’s in scope, we also identified that there are a range of different solutions that exist across the market, when we think about how you actually try to keep users safer online depending on how they’re being deployed, depending on the risks that are involved, depending on some of the technologies that those companies actually offer.

Neil Fairbrother

Okay. We might look at some of the specific solutions later. Now the UK SafetyTech industry you say in your report generated some £226 million in revenue in 2019 and has grown 35% since 2016, which on its own is an impressive figure, but how does that compare to other related sectors such as “digital” in general or indeed cybersecurity, as you mentioned just now?

Sam Donaldson, Perspective Economics

Yeah, sure. So, I mean, across the 70 dedicated SafetyTech companies that we’ve identified within the UK, as you mentioned, last year so that’s within 2019 they had combined revenues of £226 million. And we track that back historically, so we’ve looked at these companies and how they’ve grown over a number of recent years and identified that over the last three years quite consistently there’s been a 35% annual growth rate in revenues for those companies.

On that point that you mentioned about how that compares to other sectors I mean these are really substantial growth figures. I think in any industry, if you were talking about 35% year on year growth, that’s something to get quite excited about. In terms of how that compares, as I mentioned earlier, we’ve done similar research looking at the size and scale of the cybersecurity industry in the UK and that’s grown in recent years at about 15% to 20% year-on-year. On TechNation last year we recently published a report looking at the growth within the digital tech sector in the UK that was growing at about 4.5% per annum.

So I think whenever you put the backdrop of SafetyTech and its growth rates against not only just the wider economy but also other sort of digital sub-sectors, what we’ve really noticed is that there are some really rapid growth stories within this sector. And I mentioned that 35% growth rate across all of the companies, but we also found that it wasn’t uncommon, certainly within some of the larger providers within UK SafetyTech, to have been growing at rates of up to 90% year-on-year for the last couple of years. So there’s definitely a lot of growth. There’s definitely potential. And there’s a lot of demand that we’ve seen for these companies, both domestically and internationally.

Neil Fairbrother

Okay. You’ve come up with another very interesting figure where you say that in total, the combined “post-money” valuation in 2019 of the UK SafetyTech companies is £503 million, half a billion pounds. What is post-money valuation, for those of us who are not versed in these kinds of things?

Sam Donaldson, Perspective Economics

Sure. So that’s essentially looking at the valuation of each company after having raised external investments. So for example, if I’m a SafetyTech company and I’ve raised half a million pounds (£500,000) in external investments and I’ve sold 10% of my company stake [to raise that £500,000], then after that deal my valuation would be as you would expect, £5 million.

Neil Fairbrother

Okay. Now you forecast that the UK SafetyTech industry could be worth £1 billion by the mid 2020s in about five years time. What’s driving that phenomenal growth?

Sam Donaldson, Perspective Economics

Sure. So I think there are a number of growth drivers that we need to consider, looking at some SafetyTech firms within the UK. So, as I’ve mentioned, that 35% annual growth rate that’s been in place over the last three years, that’s quite a substantial growth rate, and that’s without a number of growth drivers that we’ve identified as are coming down the traps in future years.

There’s been quite a few. So as part of this research, we also held about 50 one-to-one consultations with a number of industry leads and those were some really interesting conversations. And we asked this question: what are some of the main demand drivers for your sector? Why do you see there being some substantial growth within SafetyTech?

I think one of the big ones that’s sometimes overlooked before I even get into the regulatory side of things is that there’s been very much an increased consumer awareness around online harms. So I mean, you don’t have to go too far back to recognize things like the loss of trust in online platforms, things like the Cambridge Analytica data scandal, the emergence of GDPR, I think there’s been a much more substantial consumer recognition that actually trust matters.

Trust is what sells products. And to have safeguards and to have technology in place that mean that your platforms are safer and more likely to be interacted with by users, that in itself I think has been a major driver for the sector. In terms of things like platforms, social media platforms and forums and sites that may be affected by the Duty of Care when it comes to online harms, I think there’s also been a recognition that it makes commercial sense to want to minimize toxicity and abuse on platforms.

I think we all have an understanding of going on to social media platforms and recognizing the advent of trolling and abuse, some people want to block certain content coming through to them. So I think any technology that helps to automate that process that comes to pick up on some of that abuse and to minimize it for users, I think there’s a lot of demand out there for that.

And lastly I think also there’s been a recognition that internationally there is a legislative and regulatory push towards tackling illegal and harmful content online and there’s a real need for policy and policy makers to start to understand how online harms can be mitigated and addressed. So certainly the Online Harms white paper came up time and time again as an area that there’s been a recognition from Government that actually it’s unacceptable now for platforms not to address online harms or to have or to use technology that can help kind of mitigate those challenges.

That includes making sure that sites are actually deploying appropriate content moderation, that they’re employing age-appropriate design, that they have age gates and things in place. I think all of that started coming together into a significant number of drivers for growth in this area and this industry. And I think that’s a really welcome finding.

Neil Fairbrother

You mentioned legislative and regulatory considerations and at the moment the social media platforms have immunity from liability for what’s on their platforms and they are fighting changes to legislation that go anywhere near this, such as the EARN IT Act, which is being discussed actively in the US at the moment. Would the passing of such legislation increase or decrease demand for UK SafetyTech solutions?

Sam Donaldson, Perspective Economics

Yeah, I think certainly when we think about the legislative side of things, I think there’s absolutely a connection between implementing appropriate regulation and legislation and seeing an enhancement of demand for those services. You know, whether or not companies up until this point, we’ve seen this through the growth rates that have been experienced within the SafetyTech sector, that there have been a number of companies that would be bound by such regulation that have engaged with SafetyTech providers, not only because that’s the right thing to do, but because it makes economic sense for those platforms to do it. But I think certainly as we see a roll out of regulation on the role of things like the Online Harms white paper and the proposition for than that, I think there’s definitely an expectation of increased demand and also increased supply, I guess for these 70 providers that we’ve mentioned within the report.

Obviously, if you see that these products work, or if they help to eliminate toxicity, if they help to eliminate abuse, if they help content providers and social media providers comply with regulation, legislation set out within the UK, then this report should automatically send out a message that the solutions exist within the marketplace, that they work, that they’ve been tested, that they are worth engaging with and I think all of that coming together should see a real increase in the amount of demand for SafetyTech providers. That’s very much why within this report we mentioned this market could potentially be worth a billion pounds within the UK by the mid 2020s.

And I think the emergence of Ofcom as the online harms regulator, I think that will definitely drive a lot of that demand, drive a lot of that growth. I think we’re certainly at the beginning of the journey when it comes to the economic demand for some of these solutions, but as we’ve seen with a number of providers that have been able to go on and secure pretty substantial investment, I think there’s a market recognition that greater regulation which is done in a mature and sensible way, it’s definitely likely to see enhanced demand for some of these products and services.

Neil Fairbrother

Talking about investment, the growth that you talk about isn’t just in revenues, it is in fact also in investment. You say that in 2015, the SafetyTech sector raised some £6 million in external investment across 10 different deals and by 2019, this had increased more than eight fold to £51 million across 19 deals. Where is this investment coming from and why are investors investing in this?

Sam Donaldson, Perspective Economics

Sure. So just answer that first point in terms of where the investment is coming from. There’s a mix of investments in the sector which is quite interesting. Certainly we found that within our research that there is a mix between private equity and venture capital firms that are very interested in SafetyTech as a real growth sector. And having had a number of consultations with existing venture capital firms within the sector, there’s been a real recognition that there is potentially a lot of growth to come in this area. But also, I think for investors there’s recognition, particularly among those involved with “ESG” investments, so that’s Environmental, Social, Governance investment, that there’s actually a really significant social impact to be had here. Not only can you make a return on your investment from the growth experienced within the sector, but actually your money is going towards good, your money is going towards protecting, protecting children from, from all nine harms.

I remember as one consultancy said, yes, the more investment you raise and the more that we grow, the more children we can protect from online harms. So I think that’s definitely one component of it that particularly from ESG investors, there’s been a real recognition that you can both achieve commercial outcomes but also social good.

There’s also been a significant number of business angels and high worth individuals investing in SafetyTech, very much from early days in this sector since 2015, that have continued to invest in a number of SafetyTech companies. You mentioned that investment has grown from £6 million in 2015 to over £50 million last year and certainly this is something that we would expect to see continue in future years.

I think there’s been a real ramping up, a real momentum. We’ve noticed with investment data and certainly a lot of interest has been peaked from sort of larger VC investors in this region. So only a few months ago we saw SuperAwesome, for example, have been backed by Microsoft’ M12 venture fund. So I think up until this point there’s been a story to tell. There’s been a lot of growth that’s been recognized by investors up until this point. But we would expect that to continue. We would expect to see a lot more interest in this space given, as I mentioned, not only the growth opportunities but also the chance to make your money work for good.

Neil Fairbrother

Okay. Talking about money for good and tech for good; you’ve included two charities, at least two charities anyway, the NSPCC and the Internet Watch Foundation. In what way are they developing technology or solutions, which is what you refer to in your definition of SafetyTech?

Sam Donaldson, Perspective Economics

Taking the last one first. The Internet Watch Foundation. So, having engaged with the IWF from the start of this research what we did notice [is that] they have over 140 members on their books that engage quite extensively from global big tech players right the way through to small filtering companies. Their membership model means that they’re working very closely with a number of providers to seek out the best ways to remove child sexual abuse content from the internet.

When it comes to the IWF, they’ve been a foremost player when it comes to SafetyTech solutions, so if you look at their platform, they obviously offer a range of tools to combat sexual abuse content. So image “hash” lists, take down notices, URL and domain alerts, also having engaged with a number of industry players in and around Cambridge to identify new technical solutions. So I  IWF are certainly a key member when it comes to leading the fight in terms of content hosting and taking down illicit content.

The NSPCC, we know there’s absolutely a core role for the likes of the NSPCC and other charities involved in online safety. Certainly we had identified within our research the real role of the NSPCC in terms of its thought leadership. So they publish every year a number of technical indices and metrics, looking at how safe are our children online, tracking child abuse online and the proliferation of content. And I think when it comes to considering the SafetyTech industry and considering charities, I think the two work hand-in-hand with many of them understanding the extent of the content that’s out there and allowing technical solutions to help take that down and to mediate against it.

Neil Fairbrother

Okay. Some would say that as this is most definitely in the public good sector, that all of this should be addressed by charities anyway. Why are private sector companies involved? Are they not simply profiting from other people’s misfortune?

Sam Donaldson, Perspective Economics

So I mean, I think that would be an unfair characterization to some extent. I think whenever you look at the 70 providers that are involved, certainly there are a range of companies that are involved but actually, when you think about the level of technical expertise, the level of risk that’s involved actually in setting up online SafetyTech companies, I think we need to have real recognition that actually it takes a lot of resources, it takes a lot of time, it takes a lot of commitment to develop technology that actually works, so actually can be rolled out commercially to address some of the risks.

And I think certainly what we’ve seen is that across the set of companies, companies like this, they have to generate some level of profitability or some level of investment to reinvest in the platforms that they’re developing, to invest in the technology, to invest in their capabilities and to interact with the wider sector, interact with wider commercial players. And I think you can only really do that as, in some cases, particularly when it comes to things like content moderation and age assurance, I think you could only really roll those out on a commercial basis – maybe not for profit or you may seek to reinvest.

I mean, certainly we think of companies like SafeToNet for example, it’s a really interesting example because you have SafeToNet as a private organization, but reinvests within its capability and has the SafeToNet Foundation that sits alongside it. So I think we need a real mix of capabilities from private sector, from the public sector, from charities, from academia.

I think what hopefully this report shows is that all of those components together actually are more likely to break down a number of issues when it comes to online harms and to tackle them as reflected by some of the successes, what these companies do.

Certainly having spoken to a number of industry leads and industry leaders and conducting this research, the only KPI for these companies is not just how much profit do I make, it’s how many children have I helped protect this week or how have I been able to develop a product that has lower false positive rates in detecting illicit content? I think all of that together means that the UK has a really unique sector that wants to work with all of these different parts but by no means is it just for profit.

Neil Fairbrother

Okay. In the report you’ve described a SafetyTech taxonomy. What is a SafetyTech taxonomy?

Sam Donaldson, Perspective Economics

Sure. So whenever we actually compiled this research, one of the main questions that had come up was what is SafetyTech? And within that we held a number of workshops with industry, with charities, with academia and we really wanted to get into the sort of nitty gritty of … we knew what online safety’s about, we sort of now know what SafetyTech is about because we were talking about companies that provide any sort of technical solutions to help mitigate online harms.

But when it comes to an online safety taxonomy, what we really wanted to get at was, well this is a fast moving area, the harms are constantly changing, the risks are changing and inevitably the technologies are changing. So what is in scope when we think about SafetyTech providers? We needed something to work to when we were identifying those 70 companies that I mentioned.

So within this SafetyTech taxonomy, we came up with four component parts. We segmented the sector in to system level providers, that’s organizations that are involved at the very top level when it comes to thinking like tracing, locating and removing illegal content from the internet.

We thought about platform level. So companies that work with things like social media providers, online forums, news websites and seek to provide solutions that either support the moderation process, so how do you identify, flag, remove harmful or illegal content, or how do you make sure that you have the age appropriate design built into your website, making sure that only people of a certain age can get onto your website or vice versa.

Thirdly then we thought about the device to the end point level. So if we think about giving a mobile device or an iPad to a child, you obviously want to make sure that that device has appropriate safeguards built into the device to prevent them from harm. You also want to make sure that if they’re accessing the home router or accessing internet content that that’s appropriately filtered.

And lastly that the fourth area of that taxonomy was about considering the the information environment, which is a really important sometimes overlooked area of online safety and SafetyTech, which is how do you identify and reduce misinformation and disinformation in the public domain. And that’s obviously very important given the current context that we’re in.

So those were the key areas of the taxonomy that we thought about, but broadly we wanted to make sure that when I’m presenting this industry that people have an awareness of what the technologies are and scope of the harms are. And actually from a from a supplier angle, what are the benefits of using each of these technologies on your sites as well?

Neil Fairbrother

Okay. The taxonomy itself seems to focus mostly on content. As an example, age verification, limiting access to content. What about contact and conduct, which is included in the very definition of the SafetyTech industry, what could be done about contact and conduct?

Sam Donaldson, Perspective Economics

Sure. So, I mean, I think when you come back to contact and conduct it is very important to get back into the definitions of this. So when I think contact, we’re thinking about users not being subjected to harmful online interaction with other users. And I think a lot of that does take place and is reflected very much at that moderation level.

We mentioned earlier about the gaming industry, it’s obviously important that when users are always playing a game online that any of the content that’s coming through to them is obviously also kind of contact, through the very kind of text descriptions and things. So I think identifying moderation is a really important part of the contact component.

When it comes to conduct you know, again, thinking about online behaviour that increases the likelihood of exposure to harm. Again, I would say a lot of that is reflected in not only a platform level of our SafetyTech taxonomy, but also it does come into that how users interact with each other in the information environment. So certainly companies that are looking at mitigating disinformation and misinformation, I think that’s a key part of that as well.

But I think in terms of taxonomy, what we do put in there is we recognize that this is an area, because it’s constantly moving, any of these technologies can be used to mitigate against any of those kind of three categories of risk. But what we have set out in our report is that we actually put in the line there, “for the avoidance of doubt” because we want to show how broad the sector actually is.

We are talking about organizations that often work closely with law enforcement to trace, remove illegal content. They’ll work with social media and gaming providers on the conduct and contact side. And also, there’s a whole lot of other technical aspects of this that are really important when thinking about online harms, like making sure that online platforms are sufficiently trusted around the age appropriateness, verifying the age of users and are making sure that they’re taking things like incidents of online abuse quite seriously, are able to identify them, flag them and shut them down quite quickly. So I take the point about making sure that this taxonomy reflects all of the harms. I think in the broadest sense that all of these technologies can be deployed in a way that will help kind of mitigate all three of those risks.

Neil Fairbrother

Okay. Now you say that there is a consensus in the UK that we are likely to see our first SafetyTech unicorn soon-ish. What is a unicorn and how is it measured? How is it evaluated? How do you get to be a unicorn?

Sam Donaldson, Perspective Economics

Sure. So I mean a unicorn, it’s reflected by the name, it’s fairly rare. So to date there have only been about 70, 80 unicorns or tech unicorns established within the UK. A unicorn, not to go too technical into the investment lingo, but it’s essentially a privately held company with a valuation of over $1 billion, and as we’ve mentioned before within this report and we’ve identified that the total post-money valuation of the SafetyTech companies is just over half a billion pounds. But having spoken to a number of very high growth companies within the SafetyTech sector we believe that there is potential for, as you say, at least one SafetyTech unicorn to emerge in the coming years, but potentially for a couple more. The reason why we’ve come up with that estimate is really looking at how the valuation of a number of these companies has changed so rapidly over recent years.

Certainly, if you look at companies like Uber and Deliveroo, they’re typically well-known to the UK unicorns that have hit unicorn status very quickly because there’s been a lot of hype and a lot of potential in what they do. And we believe that the same holds for small number of the SafetyTech companies that have been identified within our analysis simply given that they are very much the first movers in what they do in SafetyTech. So companies like Super Awesome and Crisp, there’s potential there for unicorn status in the coming years.

Neil Fairbrother

Okay. Now you said something very interesting in your report that the UK “has a world leading academic capacity regarding online harms”, and two of my podcast guests, we have many podcast guests who are totally brilliant, but two stand out for me,  Sonia Livingstone and Carlene Firmin are two exemplars in this area I would suggest, and you say there is a need for “interdisciplinarity to bring together behavioural, technical, legal and ethical strengths”. What do you mean by this in the context of these commercially driven organizations?

Sam Donaldson, Perspective Economics

Sure. I think it’s a really important point. It’s certainly one that has really shown through in terms of our research. So we’ve identified a number of key strengths in the wider SafetyTech ecosystem in the UK. So these are firstly a depth of experience in online safety and you mentioned Sonia Livingstone. You know, we have a real depth in terms of the academic community in online safety and SafetyTech up until this point.

But if you merge or you seek to try to combine all of these different points the UK has, firstly, it’s in depth experience in online safety. You have a lot of dynamism and disruption happening within the tech sector in the UK and what I mean by that is the real emergence of a number of tech by-products that, 10 years ago might’ve been on thinkable but now given recent advancements, particularly in the UK and cyber security, AI, machine learning, even parts of “regtech”, bringing all of those together, I think there’s a real opportunity for the SafetTech sector to work with all of those parts together.

But also whenever you’re developing technical solutions to issues around online harms, it’s really important to make sure that you have buy in from a lot of different parts. And what I mean by that is you want to make sure that your products have been rigorously tested, but they are independent, that the data that you’ve been using is rigorous and isn’t prone to sort of significant challenge.

So obviously when it comes to online harms, data sets are a very sensitive topic and has to be treated very sensitively. And you want to make sure that all of these parts are coming together in a very price sensitive way. And I think whenever you think of this all within the rounds, given the UK experience and online safety and regtech and its legal expertise, its moral and its ethical expertise it’s really important to bring all these components together because then at least having these parts together, you’ll know that you’re more likely to have trusted solutions within the marketplace. Trusted solutions that can be deployed by things like social media providers or by content holders.

Having all of those parts together means that you’re much more likely to have a trusted marketplace. I think that’s critically important. We’ve certainly seen from our research, a real willingness for academia, for charities, for tech providers, and SafetyTech to work together. But I think just having a more formal mechanism or having a greater encouragement for those parts to come together, I think this is where the real strength will lie for the UK SafetyTech sector in the years ahead.

Neil Fairbrother

Is the SafetyTech sector tarred with the same brush as the large US social media platforms or even our homegrown Cambridge Analytica?

Sam Donaldson, Perspective Economics

No, I don’t think that that has tarred with the same brush and he reason why I say that is that within this research, what we wanted to do was to identify a number of independent SafetyTech providers. So we wanted to identify companies that, from the get go, their real reason for being is developing SafetyTech solutions. They’re not making money out of generating the other social media components or generating content or collecting data on users. That’s not what their reason for being is. Their reason for being in business is to provide technical solutions to tackle online harms.

So I think the UK, looking at some of the larger providers, and certainly this is something that we find is that the UK is home to quite a range of larger providers in online SafetyTech, I think there should be an opportunity for the UK to be home to a sector that is full of trusted providers that really take their ethical, moral, legal, legal obligations very seriously indeed. And I think that’s a real strength in the sector in the UK.

Neil Fairbrother

You described five main recommendations at the end of the report. Very briefly, what are those five main recommendations?

Sam Donaldson, Perspective Economics

Sure. So the first one, I think this is arguably the most important recommendation that I’ve set out within the report which is as I said a landmark study. This is the first report that tries to look at the size and scale and defining the SafetyTech sector within the UK and we’ve argued that there’s a real need to promote and increase awareness of this sector. You know, take this report, get it out into the open world and showcase what some of the providers are actually doing. Showcase the economic opportunities because as the sector grows and as these products are rolled out to more content providers and hopefully this will actually mean that more users are kept safe online.

One of the things that we note within the research and very recently in the past couple of weeks there’s been the launch UK SafetyTech Industry Association OSTIA. I think this will go a long way to help in creating a consistent voice for the sector to coordinate awareness raising and to get different providers around the room and talking and sharing knowledge and sharing market opportunities.

The next recommendation is all about access to capital and making sure that SafetyTech organizations have appropriate access to investment. As we’ve set out within the report, there’s been a real increase in the amount of investment in SafetyTech. We’re really keen to see that things like grants, challenge funds, opportunities to commercialize academic startups are encouraged within SafetyTech. Trying to bring as much innovation, as much new thinking to the market and then making sure that it has the capital behind it to grow and to roll those products out.

Thirdly then, we mentioned about getting the policy landscape right. So obviously last month the government made the recommendation for Ofcom to be the Online harms regulator. We think that there’s a real need here for ensuring that the kid’s SafetyTech market has coherent standards, that the regulator works quite closely with them. And potentially thinking about things like a sector-wide SafetyTech strategy to ensure that all parts of government, charity and industry know where to go when working with different parts of government to grow their offer, or to be able to offer their technological services into the government because I think public procurement has a lot of power when it comes to growing the SafetyTech market.

Just lastly then, access to data again was a really important thing throughout the consultation that we had with the sector. The UK is home to a lot of expertise in AI and machine learning. We’ve seen a real ramp up in some of the technical capabilities within the UK and internationally. But making sure that that SafetyTech providers have the right access to safeguarded data, for people to train datasets to better identify online harms and to do it in a very safeguarded way is critically important.

So we’ve recommended a mapping exercise of the online harms data landscape. Obviously the more you understand all online harms then the more providers are able to identify ways for identifying and taking down harmful content, contact and conduct.

And then just lastly then, we touched on it Neil, but again, it’s critically important to support innovation and R&D in this market. So we have noticed that there are a number of mechanisms that currently exist within the UK that have been particularly favourable, things like R&D tax credits, [there’s a] real wealth in this for those to continue for supporting SafetyTech providers. But ultimately bringing together academia, bringing together industry, bringing together actual providers and understanding what the kind of the common risks are, the common challenges are on online harms, being able to test products, to be able to test and evaluate what works. I think that will provide a lot more credibility and a lot more focus for the market in the years ahead.

Neil Fairbrother

Okay. Now we are in the middle, or we are perhaps seeing the end of, the COVID-19 lockdown and pandemic. What impact has this had on your somewhat bullish forecast for the UK SafetyTech industry?

Sam Donaldson, Perspective Economics

Sure. So I certainly hope that we’re coming near the end of it, we’ll see. We do expect that the next six, 12 months will be recessionary in nature. But I think it’s important to note that a number of sectors across the UK will be negatively impacted by COVID-19 and others will be positively impacted by COVID-19. And I think when you boil this all down back again to supply and demand when considering SafetyTech, there have been a number of changes within this market that I think will mean that there is likely to be sustained demand for products that are being offered by the SafetyTech providers.

And what I mean by that is, so certainly with COVID-19, we’ve seen a real ramping up and a rise of misinformation and disinformation and certainly seen a number of providers, just in the UK being able to work alongside government to identify whether there’s misinformation about things like vaccinations and prevalence of COVID-19.

We also have a number of SafetyTech providers that are quite aligned to EdTech and making sure that children are safer online. Obviously when you have a number of children now being online more throughout the day, having to access educational platforms, you’ve [got] video chats and things like that, COVID-19 if anything has led to a real increase in digitization, which means that with that increase in digitalization, with that increase in volume of content, it’s unlikely that we’re going to step away from any reduction in demand. And we certainly see it going the other way that demand will likely to continue based upon some of the trajectories that we’ve mentioned.

Neil Fairbrother

Okay. And Sam, where can people find this report?

Sam Donaldson, Perspective Economics

Sure. So the report is being published on the DCMS website. So if you just go onto the DCMS site, search for such SafetyTech you should find it there.

Neil Fairbrother

Brilliant. Thank you very much Sam. That was a fascinating, it’s a good report, it’s well worth reading and a good job done.

Sam Donaldson, Perspective Economics

Thanks very much, Neil, I very much appreciate it. Certainly a hope that it finds its way into the wider world and this is an industry like no other. There’s a really a lot of growth opportunity here and there’s a lot of potential. Ultimately, and I say this as an economist by background who’s normally used to looking at just the numbers and the metrics, but actually there’s real potential for doing a lot of good here. So we’re certainly very excited to see what’s ahead for the SafetyTech sector.


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