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Study finds mobile connections directly impact GDP growth

The doubling of mobile data use led to an increase of .5 percentage points in the GDP per-capita growth rate in 14 countries, according to a report from the GSMA and Deloitte. The report found that countries that had a higher level of data usage from 3G connection saw an increase in their GDP per-capita growth of up to 1.4 percentage points. A 10% rise from 2G to 3G penetration increased GDP per-capita growth by .15 percentage points.

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The GSMA and Deloitte report, “What is the Impact of Mobile Telephony on Economic Growth?,”assessed the incremental benefits of next-generation mobile telephony services such as 3G technology and mobile data services and their effect on economic growth. The assessment showed that mobile telephony contributes to promoting economic growth in both developed and developing markets. In developing markets, a 10% expansion in mobile penetration increased productivity by 4.2 percentage points.

The report draws from research on data usage and economic growth in 14 countries conducted by Cisco Systems based on their Visual Networking Index as well as Deloitte studies on the productivity impact of mobile in 79 countries and 3G penetration in 96 countries.

Chris Williams, Deloitte telecommunications partner, said that data service development has the potential to drive economic development in the same way that voice services did for previous generations. The analysis of 96 developed and developing markets also showed the positive effect when consumers changed from 2G connections to 3G connections.

GSMA’s chief government and regulatory affairs officer Tom Philips, noted that total mobile connections will stand at 6.8 billion and mobile subscriber penetration at 45% by the end of 2012. He advised that “in this period of economic uncertainty, governments should look to the mobile industry as a key partner for economic growth and put in place policies that encourage investment in broadband infrastructure, which will serve to enhance productivity, as well as policies to drive the development of new data services that will boost the economy and benefit society.”

The report showed the increase in 3G connections, supported by the proliferation of mobile data-enabled devices, led to a massive growth in mobile data use. Total mobile data usage has more than doubled on average every year from 2005 to 2010 in each of the 96 countries in the sample. In Western European countries, it grew by 350%.

Countries that had a higher level of data usage per 3G connection, such as Russia, the United Kingdom and South Korea, have seen an increase in their GDP per-capita growth of up to 1.4 percentage points, according to the report. The effect is more limited for countries where mobile data usage is currently less prevalent, such as China, India, Mexico and South Africa.

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