It’s finally here – Brexit Trigger Day (BTD) from which time the two year clock before the UK withdraws from the EU experiment starts running. Stuart Lauchlan has already opined on the murky question about what happens to the Digital Single Market (DSM), concluding that:
The question posed by the [European Scrutiny] Committee as to how many DSM elements can be achieved domestically and how many will need a bi-lateral agreement is a sensible one. Whether it can be answered by 9 May is another matter. (I’ll stick my neck out and say let’s not hold our breath on that!).
But the Government’s commitment to continued participation in the wider DSM negotiations is to be welcomed and it’s to be hoped that this stands the test of the threats and counter-threats that I fear are going to chartacterise the next 18 months.
For policy makers, DSM will be seen as but one part of a much larger whole. My concern is how technology company leaders will spin the post BTD situation as their earnings start coming in en masse in April with investor days following shortly thereafter.
So far, and with the exception of Infosys, which firmly blamed Brexit on the loss of a large contract in the banking sector, commentary has been muted with minimal reference to any head or tail winds coming as a result of the Brexit decision. In earnings discussions, leaders have mostly taken a ‘wait and see’ stance, rarely highlighting specific issues or brushing Brexit aside as a topic impacting earnings.
You will find more statistics at Statista
That general position contrasts starkly with a recent poll published by Statista from ICM data (see image above,) where it is clear that while 48% of those polled are either pleased or relieved, the largest segment at 39% are worried.
The study doesn’t elaborate on the qualitative aspects of these data but from a technology standpoint, top of mind for me is the impact on changes in ‘legs and regs’ across a broad swathe of applications and especially in areas like tax, duties and documentation around the movement of goods.
There is no doubt in my mind that every company trading in and out of the UK’s borders will have a significant refresh program to undertake. And if I was in that camp then I’d certainly be in the 39% worried category.
I’m also thinking that at a time when the current US administration is pondering a broad set of tax reforms that must necessarily include a discussion around import duties, the extent to which trading and perhaps accounting systems will need changing globally could be significant.
The precise impact cannot be known although I can imagine the pure play cloud vendors getting excited by the possibility of a re-evaluation of existing IT portfolios. On the other hand, cautious companies will just as likely double down on current implementations in the expectation that their providers of choice will make sure they are in good condition for the day when the UK finally leaves the European experiment and/or the Trump regime fiddles with border taxes.
As the reporting seasons unfold and more detail about how Brexit is playing out emerge, I encourage buyers to get up close and personal with their technology providers, asking the important questions around ease, timing and cost of any required changes. We’ve already seen price hikes among cloud vendors as the UK/Euro/USD currency impact bites.
If, as seems likely, we’re going to be in a for a see-saw game of political intrigue and the promotion of vested interests, the window during which changes will need to be made, could be very short and no more than six months.
What’s that old saying? ‘May you live in interesting times.’ Nothing about Brexit is uninteresting that’s for sure!
Image credit - via free images and Eric Doyle