Quantum computing promises to solve problems currently impossible for even the most powerful supercomputers, representing a technological leap that could redefine industries from finance to medicine. While the technology is still years from widespread commercial use, a few established tech giants are positioning themselves at the forefront of this revolution, offering investors a glimpse into the future of computation.
Three companies in particular—International Business Machines (IBM), Alphabet, and Microsoft—are making significant strides, each pursuing a unique path toward building a commercially viable quantum machine. Their long-term research and development efforts are laying the groundwork for what could become a multi-billion dollar market.
Key Takeaways
- Quantum computing utilizes principles of quantum mechanics to perform complex calculations far beyond the scope of classical computers.
- Major technology companies like IBM, Alphabet, and Microsoft are the primary drivers of quantum research and development.
- While not yet commercially viable, these companies are hitting key milestones, including demonstrating quantum advantage in specific tasks.
- Investors looking for exposure to this nascent industry can consider the long-term strategies of these established tech players.
The Race to Build a New Kind of Computer
For decades, the concept of a computer that operates on the strange principles of quantum mechanics was largely theoretical. Unlike classical computers that use bits—representing either a 0 or a 1—quantum computers use qubits. A qubit can exist as a 0, a 1, or both simultaneously, a state known as superposition.
This fundamental difference allows quantum computers to process massive amounts of information in parallel, giving them the potential to tackle complex optimization, simulation, and cryptography problems exponentially faster than their classical counterparts. However, building and controlling these machines is an immense challenge.
The Challenge of Quantum Error
One of the biggest hurdles in quantum computing is the fragile nature of qubits. They are highly susceptible to environmental interference, or "noise," which can corrupt calculations. Developing robust error-correction techniques is a critical step toward building fault-tolerant quantum computers that can perform reliable, large-scale computations.
Despite these challenges, the field is advancing rapidly. The progress made by industry leaders suggests that the question is no longer if quantum computing will become a reality, but when.
IBM: A Decades-Long Pioneer
International Business Machines has been a foundational player in quantum research for decades. The company's involvement dates back to 1998, when it collaborated with universities to build one of the first computers leveraging quantum principles.
Today, IBM offers public access to its quantum computers via the cloud, allowing researchers and businesses to experiment with quantum workloads on machines with up to 156 qubits. This open approach has helped build a community and drive early-stage research.
A Clear Roadmap to Commercial Viability
IBM has laid out a detailed public roadmap for its quantum development. The company projects it will demonstrate "scientific quantum advantage"—where a quantum computer can solve a meaningful scientific problem better than a classical one—by the end of 2025.
Looking further ahead, IBM aims to build a fault-tolerant quantum computer by 2029 and begin scaling these systems for real-world applications in 2033 and beyond. This long-term vision is backed by tangible progress and growing commercial interest.
Building a Quantum Ecosystem
IBM reported it was nearing $1 billion in cumulative quantum computing signings earlier this year. These partnerships involve universities and corporations collaborating with IBM to explore potential use cases, indicating a growing demand for access to quantum hardware even in its experimental phase.
Recently, a collaboration with HSBC showed that combining IBM's quantum systems with classical machine learning could significantly speed up a computation related to bond trading. This hybrid approach, blending quantum and classical computing, is central to IBM's strategy for near-term value creation.
Alphabet: Achieving Quantum Milestones
Alphabet, Google's parent company, is another formidable force in the quantum race. The company has focused heavily on solving the critical issue of error correction, which is essential for building scalable and reliable quantum machines.
Late last year, Alphabet unveiled its "Willow" quantum computing chip, designed to exponentially reduce errors as the number of qubits increases. This is a crucial step toward creating a system that can perform useful calculations without being derailed by instability.
Demonstrating Practical Speedups
In a significant announcement in October, Alphabet revealed that it used the Willow chip to run a specific quantum algorithm 13,000 times faster than a classical supercomputer could perform the same task. This provides concrete evidence of quantum computing's potential.
Furthermore, Alphabet worked with researchers at The University of California, Berkeley, to use this algorithm to study two molecules. The results from the quantum computation matched those obtained through traditional methods, validating the accuracy of their system for scientific simulation—a key potential application for quantum technology.
While the company acknowledges that a commercially viable quantum business is still many years away, these achievements mark a clear path toward real-world applications in materials science, drug discovery, and other complex fields.
Microsoft: A Unique Approach to Qubits
Microsoft has taken a distinct and ambitious path in its quest for quantum supremacy. The company is developing topological qubits based on an exotic particle known as a Majorana fermion. The theoretical advantage of this approach is that these qubits are inherently more stable and less prone to errors than those used by competitors.
This stability could simplify the immense challenge of error correction, potentially allowing Microsoft to scale its quantum computers more efficiently.
The Majorana 1 Quantum Processor
In February, Microsoft introduced its Majorana 1 quantum processing unit (QPU). The company believes this technology provides a pathway to building a chip with one million qubits, a scale that would unlock transformative computing power.
The company's roadmap outlines several key steps:
- Perfect a single qubit with built-in error protection.
- Continue to reduce error rates.
- Scale up to systems with multiple interconnected qubits.
- Build a quantum supercomputer capable of solving major scientific problems.
Defining the Quantum Supercomputer
Microsoft has set a high bar for its end goal. A true quantum supercomputer, according to the company, must be able to perform at least 1 million reliable quantum operations per second with an error rate below one in a trillion. Achieving this level of performance would enable it to tackle problems far beyond the reach of today's most advanced classical systems.
Microsoft's approach is high-risk but potentially high-reward. If its unique qubit technology proves scalable and effective, the company could leapfrog competitors in the race to build a fault-tolerant quantum computer.
