Mobile Broadband Investment and Job Creation

Creating Jobs and Enhancing America’s Competitiveness through Mobile Broadband Infrastructure Investment

By Fred Campbell, President & CEO, WCAI

The President’s Council on Jobs and Competitiveness is meeting today in Dallas, Texas to discuss how infrastructure investment can create jobs and help America compete in the global economy. The Wireless Communications Association International is pleased that the Council is considering the incredible impact of mobile broadband infrastructure investment on job creation, American competitiveness, and economic growth. Intensive investment in mobile networks significantly increased American growth and prosperity over the last two decades and will in the next decade if government policies continue to promote investment and innovation in mobile infrastructure.

The U.S. is currently the world leader in mobile broadband innovation with the most 3G broadband subscribers and global market share in smartphone operating systems. According to a recent report from Deloitte, the U.S. wireless industry’s contributions to gross domestic product grew by more than 16% per year from 1992 to 2007, while the growth rate for the remainder of the economy averaged less than 3% per year. Despite the recession in 2007 to 2010, the U.S. continued to invest in wireless infrastructure at average level of $20 billion annually. These investments were driven by the availability of spectrum (i.e., airwaves) necessary to deploy third generation (“3G”) wireless networks and a market-oriented approach to wireless regulation that created an “entrepreneurial innovation ecosystem” of mobile infrastructure, devices, software, and content.

Even though today’s 3G networks have only recently been widely deployed, there are still enormous opportunities for additional investment in mobile broadband infrastructure. The rapid consumer adoption of smartphones is producing a wireless data explosion that threatens to overwhelm today’s 3G networks. To cope with exponential growth in mobile data traffic, the wireless industry is beginning to invest in the deployment of fourth generation (“4G”) mobile broadband technologies. Because investment in 4G mobile broadband infrastructure creates jobs, increases U.S. competitiveness, and grows the economy both when the networks are built and when they’re used, every dollar invested in mobile broadband infrastructure adds about three dollars in gross domestic product. Deloitte projects U.S. 4G network investment ranging from $25 billion (the “baseline” case) to $53 billion (the “robust” case) over the next five years, which would add 371,000 to 771,000 jobs in the U.S. and generate $73 billion to $151 billion in gross domestic product growth. The “robust” case assumes the U.S. maintains global leadership in mobile broadband by deploying 4G networks more expansively and quickly than in the baseline case.

Policymakers have a critical role to play in maximizing 4G investment and maintaining U.S. leadership in mobile broadband. Deployment of 4G network technologies on available spectrum is not enough to meet exploding consumer demand for mobile broadband capacity and enable new services that rely on 4G capabilities. Mobile broadband service providers need access to more spectrum to deploy robust 4G networks, but they cannot access the spectrum they need without the permission of policymakers. Given the projected impact of 4G infrastructure investment, authorizing access to more mobile spectrum may be the single most important policy option available to create jobs, enhance American competitiveness, and grow the economy. The best part is that policymakers don’t need to spend any taxpayer money to do it.