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Government releases its assessment of the potential impacts of 5G on Australia’s productivity and growth

AMTA welcomes the Government’s working paper on “Impacts of 5G on productivity and economic growth”, released this morning by Minister Fifield at the Commsday Summit in Sydney.

The working paper estimates that 5G is likely to improve multifactor productivity (MF) growth across the economy to the extent that this could add an additional $1,300 to $2,000 in gross domestic product per person after the first decade of the rollout.

The paper states:

Consistent with previous advances in mobile technology, 5G is expected to have a positive effect on productivity, economic growth and incomes. The overall impact on productivity and growth will depend on the extent to which the impact of 5G goes beyond an incremental effect or is more fundamental—such as becoming a general purpose technology (GPT).”

The researchers adopted a conservative approach to estimating the potential productivity impact of 5G – in that they said while 5G will be an advance on previous mobile technology, the wide array of potential uses means that it may develop as a ‘general purpose technology’ (GPT)—such as electricity or the internet—that becomes ubiquitous in its own right. However, they did not assume that 5G would develop into a GPT and their estimate of the economic benefit is likely to be conservative in that it does not fully take into account the consumer and non-market benefits that are not captured in economic statistics.

Despite its conservative approach, and uncertainty about the investment needed to enable 5G and the scope and scale of benefits that will stem from the new technology, the paper comes to the conclusion that the potential for new and improved products, and better efficiency in their production, means that 5G is likely to have an economic effect well beyond any short-term commercial return.

The paper therefore supports consideration of any changes to regulatory settings that may be necessary to make the most of 5G

AMTA believes the paper and its findings on the potential productivity outcomes of 5G show the need for continued close collaboration between Government and industry sectors – for example, under the framework of the Government’s 5G Strategy and Industry Working Group which is prioritising the following objectives in order to realise the benefits of 5G for Australia:

  • Making spectrum available in a timely manner
  • Actively engaging in the international standardisation process
  • Streamlining arrangements to allow mobile carriers to deploy infrastructure more quickly; and
  • Reviewing existing telecommunications regulatory arrangements to ensure they are fit-for-purpose.

9 April 2018

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