Mobile technology as a catalyst for innovation and socio-economic development
Forty years ago, we made the unimaginable possible by enabling people to make voice calls from anywhere. Fast forward to today and there are more mobile subscriptions than the number of people living on our planet.
Communications technology has gone from a luxury to a basic human need and for millennials and younger, connectivity is now almost as important as the air they breathe.
We know that connectivity improves everyday life, including the little things many of us now take for granted, like using digital wallets in communities without traditional banking services, smartphones to navigate through the city, wearable devices to track our health and fitness, to big things it might once have seemed unimaginable, like doctors being able to make an accurate diagnosis of a patient remotely.
Unfortunately, this reality remains a dream for more than a third of the world’s population who are unable to take advantage of the social, economic and environmental benefits that come with broadband connectivity. With the necessary infrastructure investments, ecosystems and policies, many more people can enjoy these benefits and we can transform the planet.
While previous generations of mobile networks enabled voice and some basic data connectivity, fourth-generation (4G) mobile communications, along with smartphones and their app ecosystem, have spawned a new app economy. worth more than six trillion US dollars, or seven percent of global production, and has transformed the way we live, interact and do business.
The trend towards digitization accelerated with the onset of the Covid-19 pandemic. In these difficult times, we have enabled two years of digital transformation in a few months. And the pace of acceleration has set the bar for the speed of innovation.
The confluence of the global pandemic and digital acceleration has increased our comfort with online collaboration and communication tools – using technology to reduce distance and simulate physical presence. And while we can’t eliminate the need for human touch, millions of people are now comfortable replacing physical events with virtual ones, opening up new possibilities for the way we work and live.
Online physical presence simulation is going to be part of the new world in what some call the metaverse, and others the web. 3.0. As with the first digital disruptions, the light entertainment and media industries are poised to lead this transformation.
With 5G, however, the transformation of heavy enterprises into assets will usher in a new form of digitalization-based industrialization.
The convergence of the digital-physical world will provide a number of benefits to product development and creation – enabling control of physical objects in a virtual world. The “digital twins”, virtual replicas, will be used in industrial automation, predictive maintenance support in smart factories and optimization of logistics flows.
Future connectivity will enable real-time collaboration regardless of location and thus expand access to expertise and talent pools, wherever they are in the world, making the brain drain a relic of the past.
Mobile, driving economic development
The role of mobile technology as a catalyst for innovation and socio-economic development cannot be overstated. Studies by Ericsson and Imperial College London have shown the clear link between mobile broadband penetration and GDP growth – a 10% increase in mobile broadband penetration results in a 0.8% increase of GDP.
This effect is even stronger in low-income countries, raising the possibility of leapfrogging economic development by investing in mobile broadband infrastructure.
A catalyst for tackling climate crises
Despite these economic benefits, digital transformation is also contributing to the urgent climate challenge facing humanity, not least through the energy consumed by the networks and data centers we build and operate.
While the ICT industry is responsible for 1.4% of the global carbon footprint, Ericsson research shows that ICT solutions can reduce global greenhouse gas emissions by up to 15%.
Fundamental pillars of transformation
We see three fundamental pillars to enable digitalization: the need for a robust and reliable network infrastructure; a favorable regulatory environment to encourage investment; and the evolution and growth of ecosystems.
Digital transformation requires at its core a scalable, reliable, dynamic, resilient and secure infrastructure, with reduced energy consumption.
Resilient and scalable infrastructure
Fast-growing countries in the Middle East, such as the United Arab Emirates, are investing heavily in their infrastructure capabilities to enable economic diversification and growth. In an effort to diversify their economies, these nations are now investing in groundbreaking Industry 4.0 initiatives.
Governments should encourage pervasive, high-quality infrastructure deployments. The price of spectrum in the short term should not take precedence over the value generated in the long term. Advanced countries in the Middle East have shown the way in this regard and it is starting to pay off in improving the performance of many global infrastructure leadership indices.
Spectrum policy that drives development
From a governmental and regulatory perspective, the greatest lever is the timely availability of ample, cost-effective and harmonized spectrum. Spectrum is the cornerstone of mobile communications. This is a limited national resource and depriving the mobile industry of spectrum will slow the pace of digital transformation.
It is imperative to maximize the availability of spectrum and to develop a clear, reliable and long-term timetable for its allocation. Unused or underused spectrum does not add value to any country, and long-term spectrum licensing clarity is needed to encourage infrastructure investment.
Additionally, spectrum license terms should incentivize investment with the flexibility to use allocated spectrum for multiple technologies to reduce costs and increase agility. It is essential to respect the principle of technological neutrality, to stimulate investment in infrastructure and to enable innovation.
Finally, the ability to work with a wide range of collaborators towards a common goal will become the norm, ending legacy ideas of competition, traditional boundaries, focusing on true interconnectivity.
Ericsson is committed to open standards that allow mobile innovation to thrive. We will bring together partners across ecosystems to collaborate, innovate and spark new ideas and evolve the ways we expose network functions that enable digital innovations to thrive. However, a country must ensure technology-neutral policies in order to be able to take advantage of the innovation brought by new generations of technologies.
An opportunity to accelerate development
The digital transformation offers emerging economies a huge opportunity to be major players in the coming 4th industrial revolution based on world-class digital infrastructure and innovation platforms. Governments, regulators, the telecommunications industry and application ecosystems have key roles to play in enabling this step change in development.