A 'Brexit' may have a sunny side for tech

Polls show tech industry opposition to a UK-European Union break, but the view isn’t universal

Brexit - Britain, European Union puzzle pieces
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The tech industry mostly opposes the prospect of the U.K. exiting the European Union -- a view that's supported by polls and in statements.

Ahead of Thursday's vote on the idea, London's mayor, for instance, joined 140 representatives of the city's "leading tech and creative firms" to release a letter urging a vote for "remain."

"Our capital has the potential to be the Los Angeles, New York and Silicon Valley to the rest of Europe -- and fuel the creation of new jobs across Britain. Let's not put that at risk," London Mayor Sadiq Khan wrote in the letter today.

But that position isn't universal.

Russell Stern, the CEO of Solarflare Communications, a global provider of application-intelligent networking I/O software and hardware, says an exit might help his Irving, Calif.-based company.

"The EU has created more regulatory barriers, not less," Stern said in an interview. An exit from the EU could allow the U.K. to compete as a place with less regulation, and that could have a positive business impact, he said.

Speaking about how the outcome might specifically affect his company, Stern said a vote to exit the EU could prompt Europe's financial services industry to concentrate in the U.K., increasing demand for Solarflare's technologies.

Solarflare operates a research center in Cambridge, England, and its two co-founders are from the University of Cambridge.

Discussing other possible repercussions of the vote, Stern noted that the immigration mobility now allowed in the EU has been seen as a plus for businesses and new immigration rules that would likely result if the U.K. breaks from the EU might increase the amount of time it takes to hire someone from another country. But he doesn't see a stricter immigration policy as an outright barrier to recruiting highly skilled people.

As for his personal view, Stern said he feels the U.K. ought to move ahead with the exit because the business environment today "is too cumbersome," and he would like to see "the U.K. maintain its identity."

The effects of an exit, said Jeff Broadhurst, the CEO of ERP vendor Apprise Software, will really depend on the many decisions -- such as trade agreements -- that take place after a vote to leave.

But Broadhurst said his company, which is based in Bethlehem, Pa., and has offices worldwide, is opening an office in the U.K. for better access to the market. Whether the U.K. is in or out of the EU will have no impact on that decision.

"High-tech companies in the U.K. are tremendously against the exit," said Broadhurst. But since EU regulators do not always act in favor of tech companies, "it would be possible that the U.K. becomes a better place to be based than the EU" if Britons vote to leave, he said.

If recent surveys of U.K. tech leaders are accurate, most hope to remain in the EU. CompTIA recently surveyed 32 small and midsize businesses in the U.K. and found that 53% opposed an exit, 19% were in favor, and the remainder were uncertain.

Polls of voters have indicated that the outcome will be close, and neither side was certain of victory. Results from the vote are expected to roll in tomorrow evening in the U.S. after polls close in the U.K.

There are worries about the broader economic impact of a yes decision. A Brexit would reduce freedom of movement, said Phil Gibbs, the London-based executive director of customer success for LLamasoft, a supply chain software maker based in Ann Arbor, Mich.

"Many distribution operations in the U.K. are staffed by labor that originates from the continent, particularly within the Eastern European nations," said Gibbs via email. "If restrictions are placed on their ability to work in the U.K., a labor shortage could emerge, leading to upward pressure on costs."

Investment decisions by global companies are bound to be affected, as well, said Gibbs. "They will no doubt be modeling the impact of movements in costs, labor availability and trade restrictions on their supply chain before making decisions," he said.

This story, "A 'Brexit' may have a sunny side for tech" was originally published by Computerworld.

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