Meltdown won't affect telecoms sector, says global forum
From Sonny Aragba-Akpore, Barcelona, Spain
MAJOR players in the telecommunications industry across the globe yesterday appraised the current economic crunch and asserted that the sector was not in any way threatened by the economic recession.
The declaration came from chief executive officers (CEOs) of blue chip mobile telecommunications companies, who yesterday gathered in Barcelona, Spain on the future of the industry.
They said their position was informed by the critical role the industry plays in the global economy.
According to them, the mobile telecommunications as the engine that drives the economy in most nations, would in the midst of the depression add $306 billion investment to the global economy this year.
Some of the over 400 telecoms firm chiefs, who spoke at the Global System of Mobile communication Association (GSMA) leadership summit at the opening session of the 15th Mobile World Congress in Barcelona, specifically cited China and India, two developing economies as countries where accelerated growth would take place with multiplier effects on other economies.
They said mobile telecoms would add $211 billion and $95 billion to the Gross Domestic Products (GDPs) of China and India this year while sporadic growth would also occur in Nigeria, Egypt, Algeria, and South Africa.
Government ministers and officials, industry leaders, who are attending the summit also stressed the unique role that broadband, specifically mobile broadband, could play as an economic stimulus. The firm chiefs however called on governments to support the rollout of mobile broadband services to drive economic growth.
Rob Conway, CEO of the GSMA, Carl-Henric Svanberg, boss of Ericsson, Alexander Izosimov, Chairman of the GSMA and CEO of VimpelCom, Franco Bernabe, CEO of Telecom Italia, Jon Fredrik Baksaas, helmsman of Telenor Group, Jeffrey Sachs, Director of The Earth Institute at Columbia University and Ernest Ndukwe, CEO of Nigerian Communications Commission (NCC), were among those who spoke at the event yesterday.
They set out how the wider use of mobile broadband services could stimulate growth and help the world recover from the economic crisis.
Wang Jianzhou, chief executive of China Mobile, spoke on investment in mobile infrastructure that his company had made in China and the benefits while Ndukwe focused on the State Accelerated Broadband Initiative (SABI), a baby of the NCC for fast Internet connectivity in Nigeria.
The release of new spectrum for mobile broadband services in 2009 will add the equivalent of $211 billion to China's GDP and $95 billion to India's, according to a report by Prof. Leonard Waverman and consultancy, LECG for the GSMA, which represents the global mobile industry.
The rollout of mobile broadband networks will create hundreds of thousands of jobs, encourage new businesses across the value chain, improve productivity and boost consumer spending.
As the mobile industry is one of the few parts of the private sector now capable of providing an economic stimulus, governments need to adopt policies that encourage more investment in mobile services and networks. Wherever possible, governments should seek to create a stable regulatory environment, while licensing spectrum on the right terms to encourage spending on network infrastructure and services, stimulating economic growth.
It is also important that governments allocate the same spectrum as other governments in their region for mobile broadband services - this kind of harmonisation will allow the same devices to be used in many different countries and enable manufacturers to achieve economies of scale and lower prices for end users.
The switchover to digital television will present a once-in-a-generation opportunity to make low-frequency spectrum, in which radio waves travel long distances and better penetrate the walls of buildings, available for mobile broadband services. Of the 400MHz of low-frequency spectrum freed up by the switch-off of analogue television, the GSMA believes 100MHz should be used to enable the roll out of cost-effective mobile broadband networks.
"For mobile broadband to be a mass-market service worldwide and powerful engine of economic growth, the mobile industry needs both a stable regulatory climate and access to the right spectrum on the right terms," said Conway, CEO and member of the Board of the GSMA.
"Wherever possible, governments need to allocate the same chunks of spectrum as other countries in their region, enabling equipment manufacturers to gain economies of scale by producing mobile broadband handsets, computers and other devices that will work in many different markets.
"If the mobile industry can continue to grow and develop at the rate it has over the past 15 years, it could act as one of the few locomotives which can help pull our economies out of the current slump," said Alexander Izosimov, Chairman of the GSMA and CEO of VimpelCom. "Governments need to adopt policies that nurture this potential, rather than stifling it."
Europe, Finland, Sweden, Switzerland, France and the UK have already committed to allocating some of the spectrum freed up by the switchover to digital television to mobile broadband services.
The GSMA represents the interests of the worldwide mobile communications industry. Spanning 219 countries, it unites more than 750 of the world's mobile operators, as well as 200 companies in the broader mobile ecosystem, including handset makers, software companies, equipment providers, Internet companies, and media and entertainment organisations.
