This increasing convergence of infrastructure and technology is reflected in the report's survey. 43 per cent of technology respondents anticipate entering a joint venture with an infrastructure company over the next three years, which is an increase of 100 per cent in comparison to their engagement over the past three years. Infrastructure respondents also expect to partner with tech firms with over half of the infrastructure respondents, an increase of circa 50%, anticipating a joint venture in the next three years.
Nick Ogden, infrastructure expert and partner at Pinsent Masons, comments: "For investors having technology providers play a leadership role means there are real incentives motivating them to provide the best technology and speed up delivery. Our survey shows that 92% of infrastructure investors will often or always consider tech when making investment decisions over the next three years.
"So the investors are willing to spend the money which will drive this growing trend. Collaboration is already here, and is only going to increase. On projects where infrastructure and technology are truly integrated, you can imagine there is the potential not just to create more efficient assets but also create new markets that haven't existed before."
There are obstacles with this convergence. Both infrastructure and technology respondents cited overcoming cultural differences as the main challenge to Infratech projects once initiated and 37% of respondents thought that the siloed approach to both sectors was a major barrier.
"Infrastructure needs to learn from tech firms and start changing from the inside out by bringing technology into all aspects of their operation. Both sectors will need to bring together their commercial objectives, whilst understanding each other's varied risk appetites, commercial drivers and business models," Ogden adds.
Agreeing data requirements/standards was identified in the research as the second biggest challenge for projects where technology and infrastructure are integrated, with regulatory constraints ranking in third place.
A clear majority of respondents, 91%, prefer an open access model with ownership of any data captured by Infratech. However, the same respondents report that data captured by Infratech is available to all in just 62% of the projects they work on.
Simon Colvin, Technology partner at Pinsent Masons, says: "Clear leadership is needed from government to ensure that data and information security regulations are fit for purpose in order for the benefits of Infratech to be fully maximised. With the rapid pace of technological change and digital disruption this is a challenge for any government.
"Proposed changes in the UK data legislation such as GDPR and implementation of the network and information security directive are welcomed. At the same time, however, industry continues to cry out for international data standards.
"The UK has an opportunity to be a leader in Infratech but government and industry both have a part to play in helping to cement the UK as a global leader in cutting edge infrastructure."
Interestingly, the report shows that monetising data from infrastructure comes fairly low on the list of ways Infratech is seen as adding value, mentioned by only 21% of all respondents. However, Pinsent Masons' view is that data will have significant potential as a revenue generator and its value must not be overlooked.
"Data monetisation will become a more significant feature for those involved in Infratech, particularly once the opportunities and risks are better understood by the Infratech ecosystem, and robust data sharing arrangements and data standards are in place to support emerging business models," says Colvin. "Across our global markets, we are seeing interesting PPP models emerge that incorporate data monetisation as part of the financial base case, so the success of the project will depend on revenue streams from data generated by project assets. This underlines the views of the investors, that there are new revenue streams and value to be driven out from this digital and data transformation."
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