Introduction
Quantum computing is a new form of computing that follows the rules of quantum mechanics. Quantum mechanics explains how extremely small particles, such as electrons and photons, behave. These particles act in ways that do not match everyday experience. Because of these unusual behaviors, quantum computers may eventually solve certain problems far faster than today’s most powerful classical computers.
The promise of quantum computing is real, but the technology remains immature. Physics, engineering, software, and workforce capabilities must all advance before companies can use quantum computers reliably and profitably in the real world. This article explains what must change before quantum computing delivers meaningful and sustainable commercial value.
The Promise and the Reality
Researchers often describe quantum computing as a technology that could solve problems in minutes that would take classical supercomputers billions of years. These problems include discovering new medicines, designing advanced materials, optimizing complex systems, and improving cryptography.
Despite this promise, most quantum computers today remain experimental. Companies and research institutions still face fundamental barriers that prevent widespread adoption. To move forward, the industry must generate operational profits and cash flow, as well as to overcome three major technical challenges:
- Building reliable and scalable hardware.
- Identifying valuable real-world applications.
- Developing a mature ecosystem of talent, software, cost structures, and security.
1. The Hardware Challenge: Making Qubits Reliable and Scalable
Bits vs. Qubits
Classical computers use bits. A bit exists as either a 0 or a 1. Quantum computers use qubits, or quantum bits. A qubit can exist as 0, 1, or both at the same time. Scientists call this state superposition¹.
A common analogy compares a qubit to a spinning coin. While the coin spins, it does not show heads or tails. It exists in a combination of both states. When the coin stops spinning, it becomes either heads or tails.
Superposition allows a quantum computer to explore many possibilities at once. This capability gives quantum computing its potential power.
Entanglement
Quantum computers also rely on entanglement. Entanglement links qubits so that the state of one qubit depends on the state of another, even when the qubits sit far apart². When qubits entangle, they act as a coordinated system rather than independent units.
Together, superposition and entanglement allow quantum computers to:
- Evaluate many possibilities simultaneously.
- Share information across qubits efficiently.
- Speed up certain calculations, such as optimization and simulation.
The NISQ Era: Progress with Limits
Today’s quantum computers operate in what researchers call the NISQ era, which stands for Noisy Intermediate-Scale Quantum³.
- Noisy means qubits experience frequent errors.
- Intermediate-scale means systems contain dozens to a few hundred qubits.
These machines cannot yet solve large, practical problems better than classical computers. However, recent experiments show steady progress. Companies such as IBM and Google report lower error rates, longer coherence times, and improved control over qubit systems⁴.
These advances suggest meaningful momentum, but current machines remain too unstable and too small for broad commercial use.
A. Taming the Noise: The Problem of Decoherence
Qubits are extremely fragile. Heat, vibrations, radiation, and stray electromagnetic signals can disrupt their quantum state. This loss of quantum behavior is called decoherence⁵.
To reduce decoherence, most quantum computers operate in extreme environments. Many systems cool qubits to temperatures close to absolute zero, which is colder than outer space.
What Must Change
- Better isolation: Engineers must improve shielding, materials, and system design to protect qubits from environmental noise.
- Faster operations: Quantum gates must operate faster so calculations finish before decoherence destroys the quantum state⁶.
Researchers have extended coherence times for several qubit types, but stability remains one of the most difficult challenges in quantum engineering⁴.
B. Fixing Errors: The Path to Fault Tolerance
Because noise and decoherence cannot be eliminated entirely, quantum computers must correct errors during computation. Quantum Error Correction (QEC) provides the main solution.
QEC uses many physical qubits to create a single logical qubit that behaves more reliably⁷. When errors occur, the system detects and corrects them without stopping the calculation.
This approach leads toward Fault-Tolerant Quantum Computing (FTQC). FTQC would allow long, accurate computations that businesses and researchers require.
What Must Change
- Massive scale: Experts estimate that useful FTQC systems may require hundreds of thousands or even millions of physical qubits to produce enough logical qubits⁸.
- Engineering breakthroughs: Manufacturers must dramatically improve fabrication methods, control electronics, and system integration to reach this scale.
Technology companies now publish roadmaps that target fault-tolerant systems in the late 2020s or early 2030s. These timelines represent goals rather than guarantees⁴.
2. The Application Gap: Finding Real-World Value
Even with perfect hardware, quantum computing will not succeed unless it solves valuable problems better than classical computers. The software industry often calls such breakthroughs “killer applications.”
A. Proving Quantum Advantage
Quantum advantage occurs when a quantum computer solves a problem that classical computers cannot solve in a reasonable amount of time⁹.
Researchers have demonstrated early forms of quantum advantage on narrow and highly specialized tasks. These experiments show that quantum systems can outperform classical machines under specific conditions. However, these tasks rarely deliver immediate commercial value.
Most everyday business problems, such as accounting, databases, and basic analytics, already run efficiently on classical computers.
Where Researchers See Promise
- Materials science: Quantum simulations may help design better batteries, lighter alloys, and more efficient solar cells¹⁰.
- Drug discovery: Quantum models may simulate molecular interactions more accurately, which could shorten drug development timelines¹⁰.
- Finance: Quantum algorithms may improve portfolio optimization, risk modeling, and scenario analysis for extremely complex systems¹¹.
Researchers must translate these theoretical strengths into repeatable, high-value business use cases.
B. Building Usable Software
Quantum software remains difficult to develop and deploy. Many tools require deep knowledge of physics and advanced mathematics.
What Must Change
- User-friendly tools: Developers need higher-level programming languages and software platforms that hide hardware complexity.
- Hybrid systems: The most practical near-term solutions combine classical and quantum computing. Classical computers manage routine tasks, while quantum processors handle the hardest calculations¹².
Many companies now focus on hybrid approaches because they deliver practical benefits sooner than fully quantum systems.
3. The Ecosystem Challenge: Talent, Cost, and Security
A. Bridging the Talent Gap
Quantum computing demands experts who understand physics, computer science, engineering, and real-world business problems. These individuals remain scarce.
What Must Change
- Education and training: Universities and companies must expand quantum-focused education and training programs.
- Cross-disciplinary skills: Workers must connect quantum theory with engineering realities and commercial goals¹³.
The talent shortage continues to slow progress across the industry.
B. Lowering Costs and Improving Access
Quantum computers cost millions of dollars to build and operate. Specialized hardware, advanced materials, and extreme cooling systems drive these expenses.
What Must Change
- Industrial supply chains: Manufacturers must standardize and scale production of quantum components to reduce costs⁸.
- Cloud access: Cloud-based quantum services allow companies to experiment without owning expensive hardware. This model already accelerates research and early adoption⁷.
C. Preparing for Security Risks
Large-scale quantum computers could break many of today’s encryption systems. This risk creates serious long-term challenges for digital security. This risk has spurred a quantum computing “race” among governments. Both the U.S. Government and China, for example, are heavily investing in this technology.
What Must Change
- Post-quantum cryptography (PQC): Governments and industries must adopt encryption methods that resist quantum attacks¹⁴.
- Early action: Attackers can store encrypted data today and decrypt it later once quantum machines mature. Early adoption protects sensitive data over the long term.
Global standards organizations already publish PQC standards, and many institutions have begun migration efforts¹⁴.
Investment and Market Outlook
Public and private investment in quantum technologies continues to rise. Estimates suggest global investment commitments exceed $49 billion¹⁵. Consulting firms project that quantum computing could become a market worth tens of billions of dollars by the mid-2030s¹⁶.
Despite strong investment, most quantum-focused companies face heavy research costs, long development timelines, and limited near-term profitability. Many firms rely heavily on external financing as they work toward scalable solutions.
Conclusion: Progress Requires Patience
Quantum computing continues to advance, but technological challenges are significant. Researchers have made real progress in hardware stability, error correction, and early demonstrations of quantum advantage. However, large-scale, fault-tolerant machines remain years away.
To become useful and profitable, the industry must:
- Build stable and scalable qubit hardware.
- Prove valuable real-world applications.
- Develop software, talent, cost structures, and security systems.
When these elements align, quantum computing may finally deliver on its promise.
Hemispheres Investment Management
HIM is a wealth manager with a global investment management focus (domestic and international investments in the same portfolio). Because of HIM’s global investment experience, we are uniquely qualified to meet and benefit from this secular trend toward a polycentric investment world. Our team of seasoned professionals each has over 35 years of experience in research, strategy development, and management of investment portfolios, including deep proficiency in U.S., international, and emerging markets. Hemispheres can assist you in diversifying your portfolio globally. Global Equities is Hemispheres’ flagship investment product.
Please contact Hemispheres Investment Management for a free consultation. We provide guidance to assist you in optimizing your investment strategies and helping you achieve your investment goals. Book a meeting.
References and Links
- Microsoft Azure – What is a Qubit?
https://azure.microsoft.com/en-us/resources/cloud-computing-dictionary/what-is-a-qubit - Wikipedia – Quantum Entanglement
https://en.wikipedia.org/wiki/Quantum_entanglement - Wikipedia – Noisy Intermediate-Scale Quantum Computing
https://en.wikipedia.org/wiki/Noisy_intermediate-scale_quantum_computing - IBM – Quantum Roadmaps and Error Reduction Progress
https://www.ibm.com/quantum - SpinQ – Decoherence in Quantum Computing
https://www.spinquanta.com - World Economic Forum – Building Support for Quantum Computing
https://www.weforum.org - McKinsey & Company – Quantum Computing: An Emerging Ecosystem
https://www.mckinsey.com - Deloitte – Quantum Computing Futures
https://www.deloitte.com - Management Science – Quantum Economic Advantage
- Built In – Quantum Computing Applications
https://builtin.com - Bank for International Settlements – Quantum Computing and the Financial System
https://www.bis.org - PwC – Quantum Computing and Hybrid Systems
https://www.pwc.com - World Economic Forum – Quantum Workforce Development
https://www.weforum.org - NIST – Post-Quantum Cryptography Standards
https://www.nist.gov - The Quantum Insider – Public Annual Quantum Investment Report
https://thequantuminsider.com - McKinsey & Company – The Year of Quantum
https://www.mckinsey.com
