Below is the transcript of an exclusive CNBC interview with The Rt Hon Matt Hancock MP, Secretary of State for Digital, Culture, Media and Sport.
SS: Why is London, why is Great Britain a great tech hub? Everybody wants that business. The French want it, the Irish want it, I go to every country in the Middle East, they all want to be that tech hub. Not everyone is gonna succeed.
MH: No but we're in the lead. Certainly in this time zone. The investment figures last year for instance put the UK clearly the third biggest destination after the giants of the USA and China and I admire other countries who are trying to catch up but we're absolutely determined to keep that lead. I think it's down to the depth of the ecosystem and the fact also that we have many different industries together in one place here in the UK. If you think about, you know, fintech is done best in the UK out of anywhere in the world because we have both the international financial center of the world and a great tech industry, literally side by side.
SS: I hear you Matt. But I look at the FTSE 100 and it's dominated by banks, oil companies, tobaccos. We have all these unicorns as the presence means that as the prime minister has been saying earlier as well. But we don't turn them into 10, 20, 30, 40 billion dollar companies and that's why so many U.S. companies are investing here rather than us investing so successfully in the States for instance buying companies.
MH: It is true that our ecosystem is a generation behind that on the West Coast of the U.S. but it's catching up fast. We do have as you say the biggest number of Unicorns in Europe by a country mile are here in the U.K. We do have those 10 billion, 20 billion companies. Couple of years ago ARM for instance sold for 24 billion. That was an injection of 24 billion into the U.K. ecosystem in that case based around Cambridge. Ocado is a 10 billion company it's essentially a tech company it's the biggest competitor to Amazon in the world in that space. So yeah we do have these companies but we're absolutely determined to grow more of them and ensure that we have the environment where that can happen.
SS: But when you have a very wide me remit, culture, digital, sport, you name it. I mean the British media companies, again we are a generation behind, you just admitted it as well. Why is it the Netflix and the Googles that are dominating the UK streaming scene or are having a ride. Is it at the detriment of the BBC? At the detriment of Channel 4 as well? Have we not got the right investments in that scenario?
MH: Well the BBC of course is a public broadcaster so it has a different place in the market.
SS: Should it still be a public broadcaster?
MH: Yes and we've settled that for a decade with the Charter Review. But there's a role for the UK in terms of content creation where we are pre-eminent. You know, the three biggest films of last year were all made in Britain. So we play our role in that and we're absolutely leading the world in the niche at which we excel which is the content creation. Now I'm not happy though to rest in that position. I think that there is the potential with the next wave of technologies to have the global world beating companies. And in fact one of the things that we were hearing about at the roundtable is the optimism that the some of the entrepreneurs have that the UK post Brexit can be the home for global companies of a scale that we see coming out of both China and the West Coast of the United States because we've got the ecosystem. It's now mature it's a generation maturer than it was just a few years ago because of some of these big exits but also because we can get the regulatory structure right where we get the right underpinnings that keeps the trust with society but that allows for innovation and fintech is our best example of that.
SS: Just talking about those big U.S. companies, Comcast, and I have to disclose the owner of CNBC as well, 21st Century Fox, Disney, all squabbling over assets in the U.S. media industry but also of course over Sky here in UK as well. Do you have a preference for ownership for Sky in the UK?
MH: No. There's a UK regulatory approach and I'm the quasi-judicial decision taker in that. Everybody has to go through that process. We looked at the Comcast bid and decided that there wasn't the need to issue an intervention notice. We looked at the Fox bid and that has gone through a process but we're nearing the conclusion of that as I set out to Parliament last week. We have an approach in the UK which I am very proud of which is to invite investments from right around the world and it's served us well.
SS: Just briefly if I may on another story. Gavin Patterson has just been sacked by BT as well. He was one of the champions apparently of rolling out fast fibre broadband in the UK as well. The board clearly hasn't got any confidence in Gavin to deliver that strategy, the board of B.T. as well. Do you have grave concerns that it shows a shambles at what is one of the most important companies in the UK for rolling out 21st century technology?
MH: No. I think the rollout of full fibre is incredibly important across the board. But I have every confidence in Jan du Plessis, this is the chair of B.T. to ensure that BT does what is right for them. They are a private business. Of course they're in a regulated sector.
SS: Private business but a hugely important in many ways for the UK economy not least the fact that is the company with the largest pension deficit in the western world.
MH: As you say under Gavin Patterson and Jan du Plessis they have announced a strategy which we welcomed of seriously rolling out full fibre across the board in terms of all the businesses in this space. We've been encouraging the rollout of full fibre because it's what's needed in the national interest. We want to do that through getting the right incentives in place so that it is in each company's interest to do that. That's what we're putting in place. How each company whether BT or as Cityfibre or TalkTalk or any of the other players in this space, how they respond to the incentive structures that we set out in government and with the regulator, that's a matter for them, their leadership and their shareholders. But I have every confidence in Jan du Plessis, who's an incredibly impressive man, to ensure that BT delivers on its own strategy.
SS: BT is not still too dominant in all these spaces is it? We don't need to have a tougher regulatory environment for them do we?
MH: We've had a debate over the last couple of years about how to structure this. I think we got to a really good conclusion and I welcome BT's recent strategy that it set out at its results and look forward to working with Jan with Gavin over the next couple of months and then whoever replaces him as chief executive.
SS: But again Matt it's thousands of UK tech jobs going, disappearing. Their most recent strategy is thousands of job losses.
MH: There's a change in the way they want to run the business but that's a matter for them and the amount of jobs that are being created in this sector over the whole, the broad piece is absolutely enormous. It's growing at 10 percent, which is about four times as fast as the economy as a whole, the tech sector. Now of course you know there's individual companies who will make individual decisions. It's really important that that isn't a matter for me that is a matter for them because that's the way we best generate economic growth, not government ministers making decisions over this.
SS: Fair enough. Just a quick word on Dixons Carphone Warehouse. Absolutely enormous data breach as well, one of the biggest we've ever seen in this country as well. I presume there'll be a full inquiry and the government will want to know exactly what's going on and presumably there could be some quite punitive fines here?
MH: Well the National Cybersecurity Center has already engaged on this and it's clearly potentially very serious. We're working very closely with the company now to get to the bottom of it. Of course we've got the new data protection act just came into force last month which does bring in higher fines. And we've got to make sure that people are protected and properly informed of what's happened to their data. But the thing I'm now confident of, with that new act on the statute book, is we've got the system in place with the National Cybersecurity Center leading the incident response and of course the Information Commissioner as the data regulator and that system is working exactly as it should in this case.
SS: Alright thank you very much indeed for that.
MH: Thank you.
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