On October 3, 2025, California Governor Gavin Newsom made a significant stride in the tech industry by signing Assembly Bill 940 (AB 940) into law. This legislation aims to propel California’s quantum technology industry to new heights by establishing a unified strategy for growth and innovation. With the presence of federal research centers, including the National Science Foundation and U.S. Department of Energy, California is already recognized as a leader in quantum research. The swift innovation anticipated as a result of AB 940 could set the stage for not only California’s economic expansion but also a transformative effect on the global economy.
Quantum Computing – A Brief Refresher
At its core, quantum computing leverages the principles of quantum mechanics to tackle problems at speeds and complexities far beyond the capabilities of classical computers. By utilizing quantum bits, or qubits, these advanced systems are capable of processing and storing information in groundbreaking ways. This technology is becoming increasingly critical for a variety of applications, from sophisticated encryption methods to groundbreaking scientific inquiries. As we enter 2025, quantum computing is projected to be one of the most influential technological innovations of the year.
AB 940 – California’s Approach and Mandate
AB 940 is more than just legislation; it’s a part of California’s broader economic strategy, specifically tailored to enhance the state’s quantum technology sector. This legislation mandates the Governor’s Office of Business and Economic Development (Go-Biz) to design industry-specific strategies that will boost California’s competitive edge in quantum technology and other emerging sectors. The state is committed to nurturing a strong talent pipeline, fostering new research and development initiatives, and creating job growth opportunities in quantum technologies.
As part of this initiative, Go-Biz is tasked with preparing a comprehensive quantum technology strategy by July 1, 2026. This strategy will provide an overview of the industry’s current landscape, identify barriers to growth, and outline actions necessary to attract investment and jobs. The Governor’s Office is backing this ambitious plan with a substantial investment; $4 million has been allocated for quantum research and innovation as part of the 2025–2026 state budget.
Beyond California – A Global View of Quantum Technology
Marking its commitment to the advancement of quantum technologies, the United Nations declared 2025 as the International Year of Quantum Science and Technology. This designation celebrates a century since the inception of quantum mechanics but hints at an even more pivotal decade ahead. According to McKinsey’s Quantum Technology Monitor, the core pillars of quantum technology—quantum computing, quantum communication, and quantum sensing—could generate revenues of up to $97 billion by 2035. These projections emphasize the substantial economic impact expected from advancements in these areas.
States like California are thus ramping up investments in quantum technology. In 2024 alone, governments worldwide injected $1.8 billion into various quantum technology initiatives, including a $620 million investment by Australia and a $500 million fund from Illinois to develop a quantum park. Public sector investment has continued to gain momentum into 2025, highlighted by Japan’s announcement of a staggering $7.4 billion commitment to its quantum sector.
A New Addition to the ‘As a Service’ Model
The tech community is well-acquainted with models such as Software-as-a-Service (SaaS) and Platform-as-a-Service (PaaS), but in the coming years, the term Quantum-as-a-Service (QaaS) is set to emerge prominently. QaaS offers a promising opportunity for companies looking to experiment with quantum technologies without the hefty financial burden of developing in-house capabilities.
As the QaaS market evolves, industries such as pharmaceuticals, biotechnology, automotive, aerospace design, and financial services are considering how these technologies could enhance their operations. Early use cases are being identified, and organizations are keenly observing how market standards, similar to those seen in SaaS agreements, will develop—covering aspects like service levels, data usage, security commitments, and liability limitations. The introduction of QaaS may redefine operational dynamics for businesses eager to harness quantum technology’s potential.