About forty years ago, we made the unthinkable possible by enabling people to make voice calls from anywhere. Fast forward to today and there are more mobile phone subscriptions than there are people living on our planet.
Communications technology has gone from being a luxury to being a basic human need, and for millennials and young adults, connectivity is now just as important as the air they breathe.
We know that connectivity improves life every day, including the little things many of us now take for granted, like using digital wallets in communities without traditional banking, smartphones to navigate our way across town, and wearables to track our health. And our physical fitness, and big things that may once have seemed unimaginable, like the ability for doctors to make an accurate diagnosis on 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 required investments in infrastructure, ecosystems, and policies, more people can enjoy these benefits and we can change the planet.
While previous generations of mobile networks enabled voice and some basic data connectivity, fourth-generation (4G) mobile communications, together with smartphones and their application ecosystem have produced a new application economy worth more than six trillion US dollars, or seven percent of output global, and changed the way we live, interact and conduct business.
The trend towards digitization has accelerated with the advent of the Covid-19 pandemic. During these challenging times, we’ve enabled two years of digital transformation in a matter of months. The pace of acceleration has set the standards for the speed of innovation.
The confluence of the global pandemic and digital acceleration has increased our convenience in online collaboration and communication tools — using technology to shrink distance and simulate physical presence. And while we cannot eliminate the need for human contact, millions of people now feel comfortable replacing physical events with virtual ones, opening up new possibilities for how we work and live.
A simulated physical presence online will become part of the new world in what some call the metaverse and others the web. 3.0 As with the early digital disruption, the entertainment and media light industries are poised to lead this transformation.
However, with 5G, the transformation of the asset-heavy enterprise will lead to a new form of manufacturing based on digitization.
The convergence of the physical world into digital will provide a plethora of benefits for product development and creation – allowing control of physical objects in the virtual world. “Digital twins,” virtual replicas, will be used in industry automation, helping with predictive maintenance in smart factories, and optimizing logistical flows.
Future connectivity will allow real-time collaboration regardless of location, thus expanding access to expertise and talent pools, wherever they are in the world, making brain drain a relic of the past.
Mobile drives economic development
The role of mobile technology as a catalyst for innovation and social and 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 per cent increase in mobile broadband penetration leads to a 0.8 per cent increase in GDP.
This effect is stronger in low-income countries, hence the potential for leaps in economic development through investment in mobile broadband infrastructure.
A catalyst for addressing the climate crisis
Despite these economic benefits, digital transformation also contributes to the pressing climate challenge facing humanity, particularly through the energy consumed by the networks and data centers we build and operate.
While the ICT industry is responsible for 1.4 percent of the global carbon footprint, research conducted by Ericsson shows that ICT solutions can enable a reduction of global greenhouse gas emissions by up to 15 percent.
Basic pillars of transformation
We see three key pillars to enable digitization: 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 at its base requires scalable, reliable, dynamic, resilient and secure infrastructure, with lower energy consumption.
Flexible and scalable infrastructure
Rapidly growing countries in the Middle East such as the UAE are investing heavily in their infrastructure capabilities to enable economic diversification and growth. In an effort to diversify their economies, these countries are now investing in Greenfield Industry 4.0 initiatives.
Governments must incentivize widespread, high-quality infrastructure deployments. The short-term price of spectrum should not be prioritized over the long-term value generated. Developed countries in the Middle East have led the way in this matter and are beginning to pay dividends by improving performance in many indicators of global infrastructure leadership.
Spectrum policy driving development
From a government and regulatory standpoint, the biggest lever is the timely availability of cost-effective and coordinated broad spectrum. Frequency spectrum is the lifeblood of mobile communications. It is a finite national resource, and starving the mobile spectrum industry will slow the pace of digital transformation.
It is necessary to maximize spectrum availability and establish a clear, reliable and long-term schedule for its allocation. Unused or unused spectrum does not add value to a country, and long-term clarity of spectrum licensing is essential to encourage infrastructure investments.
Furthermore, spectrum licensing terms should incentivize investment with the flexibility to use spectrum allocated to multiple technologies to reduce cost and increase resilience. It is crucial to uphold the principle of technology neutrality, to stimulate investments in infrastructure and enable innovation.
Finally, the ability to work with a wide range of collaborators to achieve a common goal will become the norm, ending inherited ideas of competition, and traditional boundaries, by focusing on true interdependence.
Ericsson is committed to unlocking the standards that enable mobile innovation to flourish. We will bring together partners across ecosystems to collaborate, innovate, ignite new ideas, and develop ways in which we uncover network functions that enable digital innovations to scale. However, the country must ensure technology-neutral policies so that it can benefit from the innovation brought by new generations of technology.
Opportunity to develop a frog jump
The digital transformation of emerging economies offers a huge opportunity to be a major player in the upcoming Fourth Industrial Revolution based on world-class digital infrastructure and platforms for innovation. Governments, regulators, the telecom industry, and application ecosystems play major roles in enabling this incremental change in development.