The UK government is deciding whether to walk away from Palantir, the American data analytics company, before its national health data contract even finishes its first phase.
The deal, worth about $445 million, was signed in 2023 to build a system called the Federated Data Platform. The idea was simple: give every hospital, clinic, and regional health board in England one shared way to see patient data, instead of the mess of spreadsheets, paper, and disconnected systems that has caused missed treatments and wasted hospital time for years.
Most of the health service has gone along with it. Out of roughly 200 hospital trusts, 139 are live on Palantir's system, and 35 of England's 36 regional health boards use it too. But one board, covering Greater Manchester and its 3 million residents, has refused since day one.
Manchester built its own platform instead, over almost a decade, using its own staff and its own rules for who gets access to what. It says the homemade system does some things better and is easier to change when a piece of it becomes outdated. More importantly, it says people in Manchester trust it, because they know who built it and why.
That trust question is the real story here. A hospital data system is only useful if patients are willing to have their records in it and doctors are willing to use it every day. Palantir's system might be technically capable, but if the public associates the company with government surveillance, military contracts, and the current US immigration crackdown, some people will hold back their data no matter how good the software is.
This is not an isolated British argument. Germany's military recently excluded Palantir entirely from a major defense computing contract, and Germany's domestic intelligence agency picked a French company instead. France and Germany have since jointly promised to build their own version of what Palantir offers, specifically so European governments stop depending on one American company for sensitive data work.
Palantir's business is not slowing down because of this. Its government revenue jumped 55 percent in one recent quarter compared to the year before, and total company revenue grew 63 percent over the same period. The US government and US companies are buying more Palantir than ever. Europe's discomfort is a regional problem for the company, not a company-wide one, at least for now.
The bigger lesson for any business sits outside the Palantir story specifically. When you hand a critical piece of your operation, whether it is data, payments, or customer records, to a single outside vendor, you are also inheriting that vendor's reputation and politics. Manchester's slower, homegrown approach cost more time upfront. It is now the reason the region has full control over its own decision, while the rest of the country waits to see what the government decides next February.