The news: Alphabet is spinning off Sandbox AQ as an independent, venture-backed SaaS business aimed at enterprises, which could spearhead an industry-wide uptick in quantum technologies.
Why it's worth watching: Sandbox AQ plans to develop enterprise software that uses quantum technologies to “address pressing global challenges,” per Insider.
- Originally a passion project of Google founder Sergey Brin, Sandbox AQ focuses on how quantum technology can intersect with AI and software. Investors in the spinoff include former Google CEO Eric Schmidt, Salesforce CEO Marc Benioff, and entrepreneur Thomas Tull who will serve as advisors in the board.
- Unlike Google’s Santa Barbara-based team building quantum computers, Sandbox AQ, which will be led by Jack Hidary, will focus more on the applications of quantum tech for business-facing clients.
- Current Sandbox customers include SoftBank Mobile, Vodafone Business, and New York's Mt. Sinai Health System.
- Jim Breyer, CEO of Breyer Capital, told Insider that there was a "tremendous opportunity" for quantum technology in medicine and healthcare but added that cybersecurity would be where Sandbox AQ could have the most immediate impact.
- Quantum technology can also be used to solve problems like EV charging times.
The opportunity: Most of the breakthroughs in quantum tech, like Amazon’s and Microsoft’s earlier forays, have focused on quantum computers and hardware solutions. Google spinning off Sandbox AQ could indicate a trend toward expanding business software and applications.
- Sandbox AQ could be one of the first quantum technology integrators to sell to businesses. The company is nearing deals to sell simulation software to accelerate the development of drugs and materials, per Reuters.
- According to Gartner, by next year, 20% of global organizations are expected to budget for quantum-computing projects, up from less than 1% in 2018.