The Business Perspective of Quantum Computing: An Overview

Andrey Saltan1 and Sami Hyrynsalmi1

Abstract
Quantum computing has the potential to become the next breakthrough disruptive technology
in computing, with a profound impact on numerous industries. Quantum computers exploit the
principles of quantum mechanics that enable quantum computers to deal with certain types of
complex problems significantly faster than regular computers. However, if quantum computing
is to achieve its potential, there needs to be a clear understanding from different perspectives
of the challenges and opportunities the technology brings to the world. Against this backdrop,
this research evaluates application areas of quantum computing and discusses its business
prospects. The findings highlight the challenges that should be surmounted to make quantum
computing a technology that becomes a reality with a positive societal and business impact.
Keywords 1
Quantum Computing, Business Model, Business Value

1. Introduction
Computing and communication technologies have repeatedly fundamentally reshaped the software
industry by changing the structure and rules of the game. The emergence and evolution over the past
decade of the technological phenomena commonly known as quantum computing represents the next
revolution of the software and hardware industries with a drastic impact on multiple other software-
intensive ones [1]–[3]. While the full implications of quantum computing are most probably decades
away, governments and private sectors worldwide have already committed billions of dollars to further
advancing quantum computing technology and applications [4]–[7]. As of now, more than 600,000
people are expected to work in the quantum industry by 2040, following the expansion of quantum
technology into other industries where breakthrough technologies can bring value. With such great
prospects for allocating talent and monetary resources to quantum computing, the progress in scaling
up is hard to overestimate [8].
Quantum computing is a computing paradigm centered around the principles of quantum mechanics
that distinguish quantum computers from traditional ones. First, quantum computing is not built on bits
that are either 0 or 1 but on quantum bits (qubits) that can take on the values of 0 and 1 simultaneously
along a probability spectrum. This overlap of the values of 0 and 1 is called superposition. Second,
qubits do not exist in isolation and can be connected despite being physically apart. This ability to act
as a group is called entanglement. Developing a quantum computer hardware that can create, perform
operations on and measure qubits is challenging since any disruption of the qubits’ environment may
lead to the loss of information stored using them. Leading research organizations and tech companies
are actively exploring engineering approaches to building machines based on quantum mechanics. Still,
eligible hardware for quantum computing is not fully ready for commercial use and exists only in a
laboratory environment where most quantum computers run less than a few thousand qubits [6], [9].
While the bottleneck of the entire quantum revolution still exists and is related to the issue of
hardware, where multiple technological challenges still need to be overcome, large IT giants and
ambitious start-ups are already thinking about quantum applications to ensure that when the technology
comes, these software companies will be ready to take their solutions to market [10]–[14]. There is an
equally urgent need to understand the business-related aspects of quantum computing, including

ICSOB’ 22: 13th International Conference on Software Business, November 8–11, 2022, Bolzano, Italy
EMAIL: [email protected] (A. 1); [email protected] (A. 2)
ORCID: 0000-0002-7921-986X (A. 1); 0000-0002-5073-3750 (A. 2)
©️ 2022 Copyright for this paper by its authors.
Use permitted under Creative Commons License Attribution 4.0 International (CC BY 4.0).
CEUR Workshop Proceedings (CEUR-WS.org)
evaluating the types of problems and application industries, assessing how the ecosystem of
organizations and companies involved in the business of quantum computing should be structured and
governed, and exploring opportunities and risks quantum computing will create.

2. The Business Landscape of Quantum Computing

Quantum computing can be described as a stack formed by layers [15]. There is no unified approach
to the designation of these layers; researchers and practitioners offer various classifications. We suggest
differentiating between four quantum computing layers.
Starting from the bottom, the base layer of the quantum computing stack is the Physical Hardware
layer responsible for creating infrastructure for qubits building. Above this layer lies the Compilation
and Control Systems layer, responsible for regulating qubits status and ensuring qubit operations and
measurements. The Software layer runs on top of the Compilation and Control Systems, implements
quantum algorithms, and compiles the source code into executable programs. At the top of the stack,
the Application and Service layer contains the applications and services that provide complex problems
solving solutions.
The proposed stack allows the identification of the following three major categories of quantum
computing businesses:
• Full-stack quantum computing companies cover the scope of the entire stack and aim to
offer generic services to the public. Examples: IBM, Google, D-Wave, Honeywell.
• Hardware quantum companies cover the first two layers of the quantum stack and focus on
developing the solution to enable quantum mechanics in their computing machines. These
companies might expand the scope of their business to the other layers or build an ecosystem
of software and service companies around their technological solutions. Examples: Intel, IonQ,
QuTech, Quantum Circuits.
• Software and service quantum providers cover the top two layers of the quantum stack and
focus on enabling quantum technologies to solve complex real-world problems across different
industries. Examples: Zapata Computing, 1Qbit, Cambridge Quantum.
Besides these three core categories of companies directly related to quantum computing, a myriad
of companies provide focused support to the core quantum companies (e.g., providing cooling
technology and error forecasting).
Since quantum computers can achieve an exponentially higher information density than classical
computers, they unlock the ability to perform specific complex calculations exponentially faster than
traditional computers. This promises exciting opportunities for more advanced applications which rely
on complicated mathematics and simulation software. Table 1 provides an overview of the main areas
of algorithms where quantum computing might bring breakthrough advances. Table 2 provides an
overview of the most promising industrial application areas of quantum computing. Both taxonomies
are based on publicly available information on existing quantum computing companies.
All the benefits quantum computing brings come with a cost. The costs here are the challenges and
risks related to reshaped software and software-intensive industries due to the appearance and evolution
of quantum computing. They include but are not limited to the following ones: (1) Business information
security, (2) Digital divide and inequity issues, (3) Artificial intelligence policymaking, (4) Military
applications and weapons race, and (5) Qualified labor shortage. Not facing these challenges and risks
could undermine the global progress we assume to achieve with the help of quantum computing.

3. Conclusion

Quantum computing requires a coordinated response from all participants of this computing
revolution, including government, businesses, and the research community. While the precise roadmap
for the evolution of the technology and the industry around it is still unclear, great efforts and significant
investments ensure that quantum computing is here to stay. The ongoing research presented is especially
relevant as we are still in the early stages of the quantum computing race, while much research is
currently taking place in the field of quantum computing technology itself.
Table 1
Quantum computing application areas
Algorithmic area Quantum computing solution
Linear systems and • Quantum computing unlocks the ability to significantly reduce the time
machine learning for solving equations of linear systems. This would lead to a drastic
advance in machine-learning algorithms, including ones for clustering,
object recognition, and pattern matching.
Simulation • Quantum computing enables significantly more sophisticated modeling of
complex physical and social systems
Combinatorial • Optimization algorithms determine the optimal value of a given function
optimization and recommend the decision to be made in each combination of internal
and external factors.
Unstructured • Due to the different way the data is organized using qubits, quantum
search computing enables searches across a more considerable amount of data
with significantly less power and time used
Factorization and • The decryption of security protocols that rely on the complexity of
encryption factoring the product of large prime numbers

Table 2
Quantum computing industrial application
Algorithmic area Quantum computing solution
Digital services and • Enhancements in performance and speed of search and recommendation
telecommunication algorithms
• Emergence and development of quantum communication networks
• Advanced marketing and customer analytics and target advertisement
optimization solutions
Manufacturing and • The improved discovery and design of new materials and compounds
production • Fluid dynamics simulation for the enhanced aerodynamic design of
vehicles and vessels
• Production line optimization and process robotization
Logistics and • Advanced supply-chain and logistic routing optimization solution
transportation • Advanced fleet management and transport network scheduling solutions
Cyber and software • Post-quantum superior encryption technologies
security • Advanced solution for software viruses and other malware detection
• Enhancements in software code verification and validation
Chemicals and • Improved discovery of new medications and chemical compounds
pharmaceuticals • Performing the analysis of complex multifactorial diseases and the
development of treatment protocols
Finance and • Advancements in Portfolio investment and risk strategy optimization
insurance • Enhancements in financial market simulations techniques
• Improvements in transaction fraud and anomaly detection
Energy and utilities • Enhancements in designing and improving the energy efficiency of
nuclear and thermonuclear reactors
• Improved geological resources exploration and drilling optimization
Science and • Providing a better understanding of the functioning of complex physical,
education chemical, biological and social systems
• Advancements in climate and natural disasters forecasting technologies
• Enhancements in DNA sequence classification
Military and • Advanced intelligence, surveillance, targeting, and reconnaissance
defense solutions
Acknowledgments

The PHP Foundation supports this research with grant #20220006.

References

[1] S. Ghose, “Are You Ready for the Quantum Computing Revolution?” Harvard Business Review,
Sep. 17, 2020. Accessed: May 19, 2022. [Online]. Available: https://hbr.org/2020/09/are-you-
ready-for-the-quantum-computing-revolution
[2] A. Ménard, I. Ostojic, M. Patel, and D. Volz, “A game plan for quantum computing,” McKinsey
Quarterly, Feb. 2020.
[3] V. Martin et al., “Quantum technologies in the telecommunications industry,” EPJ Quantum
Technol, vol. 8, no. 1, pp. 1–31, Jul. 2021, doi: 10.1140/epjqt/s40507-021-00108-9.
[4] E. Gibney, “Quantum gold rush: the private funding pouring into quantum start-ups,” Nature, vol.
574, no. 7776, pp. 22–24, Oct. 2019, doi: 10.1038/D41586-019-02935-4.
[5] J. Ruane, A. McAfee, and W. D. Oliver, “Quantum Computing for Business Leaders,” Harvard
Business Review, Jan. 01, 2022. Accessed: May 19, 2022. [Online]. Available:
https://hbr.org/2022/01/quantum-computing-for-business-leaders
[6] E. R. MacQuarrie, C. Simon, S. Simmons, and E. Maine, “The emerging commercial landscape of
quantum computing,” Nature Reviews Physics, vol. 2, no. 11, pp. 596–598, Oct. 2020, doi:
10.1038/s42254-020-00247-5.
[7] M. Räsänen, H. Mäkynen, M. Möttönen, and J. Goetz, “Path to European quantum unicorns,” EPJ
Quantum Technol, vol. 8, no. 1, Dec. 2021, doi: 10.1140/EPJQT/S40507-021-00095-X.
[8] Y. He and W. He, “Quantum computing and technologies: State-of-Art and Future Prospects” in
Information Conference on Informations Systems (ICIS), 2021.
[9] V. Hassija et al., “Present landscape of quantum computing,” IET Quantum Communication, vol.
1, no. 2, pp. 42–48, Dec. 2020, doi: 10.1049/IET-QTC.2020.0027.
[10] A. Shipilov and N. Furr, “Making Quantum Computing a Reality,” Harvard Business Review, Apr.
18, 2022. Accessed: May 19, 2022. [Online]. Available: https://hbr.org/2022/04/making-quantum-
computing-a-reality
[11] M. Krelina, “Quantum technology for military applications,” EPJ Quantum Technology, vol. 8,
no. 1. SpringerOpen, pp. 1–53, Nov. 06, 2021. doi: 10.1140/epjqt/s40507-021-00113-y.
[12] F. D. Albareti et al., “A Structured Survey of Quantum Computing for the Financial Industry,”
2022.
[13] F. Leymann, J. Barzen, and M. Falkenthal, “Towards a Platform for Sharing Quantum Software,”
in Advanced Summer School on Service Oriented Computing, 2019, pp. 70–74.
[14] C. Outeiral, M. Strahm, J. Shi, G. M. Morris, S. C. Benjamin, and C. M. Deane, “The prospects of
quantum computing in computational molecular biology,” Wiley Interdiscip Rev Comput Mol Sci,
vol. 11, no. 1, p. e1481, Jan. 2021, doi: 10.1002/WCMS.1481.
[15] P. Gerbert and F. Ruess, “The Next Decade in Quantum Computing — and How to Play,” The
Boston Consulting Group, pp. 1–34, Nov. 2018, Accessed: May 19, 2022. [Online]. Available:
https://www.bcg.com/publications/2018/next-decade-quantum-computing-how-play