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Mobile Recovery?

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As the dust settles around the debt ceiling debate, there is broad hope that our nation's leaders continue to focus in a constructive way on getting our fiscal house in order. While recent debate centered around whether we raise taxes or cut government programs, too little discussion has focused on what it will take to support the most powerful engine of lasting and sustainable economic recovery and job creation--the private sector.

Much attention has rightly noted the promise of the mobile Internet to be a catalyst for an economic turnaround. This week, Mobile Future released fresh analysis to support this claim. The paper, authored by David Sosa and Marc Van Audenrode of the Analysis Group, explores some of the key positive economic impacts, including job creation, associated with achieving the Federal Communications Commission's objective of making an additional 500 MHz of spectrum available to support expansion of the mobile Internet.

The report calculates the economic benefits of policymakers making more spectrum available to support mobile Internet expansion. Among the key findings:

  • 500 MHz of spectrum = 500,000 U.S. Jobs. Reassigning 300 MHz of spectrum to mobile broadband within five years will create 300,000 Americans jobs. Adding another 200 MHz of spectrum after five years, and we'll create 200,000 more direct and indirect jobs from supporting and expanding today's innovations alone.
  • 300,000 Added Jobs for Every 1% Increase in Internet Penetration. Increased spectrum will allow even more Americans to use wireless broadband, bringing us closer to President Obama's goal of 98% of Americans having access to the mobile Internet within five years. Many companies and entrepreneurs will use that added connectivity to start or expand their businesses, creating 300,000 jobs for every 1 percent increase in broadband penetration.
  • Nearly $400B in GDP Growth. Similarly, more robust mobile Internet means more robust consumer usage and business reliance of innovative new connected tools. The paper estimates that an addition 300 MHz of spectrum for mobile broadband will add $230 billion to U.S. GDP. The second wave of 200 MHz of new spectrum will bring another $155 billion, the analysts find.
  • $75B in Direct Network Investment. The report also estimates that mobile Internet providers will spend north of $75 billion to put this additional spectrum to use for their customers through expansions and upgrades of their networks. This investment has a ripple effect that triggers increased spending and job creation, for example, by companies that build and manufacture supplies for these networks.
  • 500,000 Jobs = Tip of the Iceberg. Perhaps the most stunning estimate in the whole report is the upfront observation that what the analysts can't predict is likely larger in scale than what it can. Just 3 years ago, we had never heard of an "app." Today, U.S. consumers can access nearly 1 million mobile apps from 26 competing app stores. The authors are respectably conservative in their upfront acknowledgement that they cannot credibly forecast the next Facebook or Google. But they make clear that with additional spectrum for the mobile Internet that it's coming and the impact is likely more significant than the tangible progress they can document today. These so-called 'spillover effects' from innovations that can be foreseen today are likely to exceed "by a considerable margin" the author's other findings of economic growth and job creation.

The risks associated with the debt ceiling debate were cast as one economic challenge our nation's policymakers could readily avoid through timely action. In a much more constructive way, making more spectrum available to fuel healthy, robust expansion of the mobile Internet is another positive step that policymakers can make today. The action doesn't focus on preventing economic calamity. Instead it emphasizes building for the future. It focuses on giving this wide ecosystem of mobile innovation--from applications developers to gadget makers to carriers and the millions of entrepreneurs who leverage mobile connectivity to expand their diverse businesses.

Timely action to ensure a healthy and expanding mobile Internet gives all of these companies--and the many game-changing businesses yet to come--the greatest possible shot at creating good-paying jobs and healthy, real and sustainable economic growth. After all the energy devoted to avoid default, it's time to put that same determination behind a concrete roadmap for genuine recovery--and the leadership and global competitiveness that must be our shared, ultimate objective in a connected world.

Jonathan Spalter, chairman of Mobile Future, has been founding CEO of leading technology, media, and research companies, including Public Insight, Snocap, and Atmedica Worldwide. He served as an advisor to and spokesperson for Vice President Al Gore during the Clinton administration.

Mobile Future is a 501(c)(4) coalition comprised of and supported by technology businesses, non-profit organizations and individuals dedicated to advocating for an environment in which innovations in wireless technology and services are enabled and encouraged. For a full list of members and sponsors and to learn more about the coalition, go to www.mobilefuture.org.

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