A new Deloitte spectrum policy report explores the relationship between spectrum and mobile broadband leadership on a global basis, especially as concerns the U.S. market. The report notes the United States is a leader in mobile broadband but warns that unless more spectrum is made available for mobility services, the country’s growth in this area could wane and raise the risk of economic consequence.
The report shows that the United States so far has strong growth in the mobile broadband market, increasing its position by 11% year-over-year compared with other countries and regaining the ground it had lost over the past several years, according to Deloitte. Other countries, including Canada and China, had growth of 6% and 5% respectively.
“We all know the mobile ecosystem has been a tremendous success,” said Craig Wigginton, partner at Deloitte & Touche and leader of its U.S., global and Americas telecom practice. “It’s been a strong economic engine. We just see that the availability of spectrum is not moving as quickly as it should be.
“What’s interesting is other countries aren’t standing still on this,” he added. The report notes that China is expected to invest $320 billion in broadband infrastructure through 2020 and that its “4G” investments may reach $16 billion this year, while India is planning to auction off 100 megahertz of spectrum that could benefit wireless broadband.
The Deloitte spectrum report examines the U.S. goal of having 500 megahertz of spectrum available for cellular use by 2020, and it looks at projections for both a favorable trajectory in which that goal is achieved and an unfavorable one in which it is not. The economic consequences of the United States losing its leadership in the mobile broadband space “could be severe,” Deloitte warns, with “diminished technology eminence as well as a direct loss of $67 billion in [gross domestic product] and 344,000 jobs in less than a decade.”
“The spectrum isn’t just sitting there unused,” Wigginton noted. “It needs to be re-allocated and cleaned and that takes time. That’s really the whole point — you can’t think about 2020 without putting some major steps in place ahead of time. If we run out of spectrum, it’s not like we hit a wireless wall,” he added, but it will mean heavy traffic on networks.
“It’s not that spectrum is the only key factor, but it is probably the single largest gating issues,” Wigginton said.
The importance of mobile broadband across industries is also illustrated by the report, as Deloitte said that indirect effects from a shortage of mobile broadband could be even larger than the direct consequences. The firm also said that the “Internet of Things” movement, which is highly dependent on mobile access, represents a $1.2 trillion opportunity that could be negatively impacted if sufficient spectrum is not available.
This is the fourth edition of Deloitte’s report and includes an index comparing the United States against 19 other countries. You can watch a related RCR Wireless News interview with Deloitte’s Kevin Thompson on spectrum policy here.
