Mobile to add $1 trillion to N. American economy by 2020

By:
James Pearce
Published on:

Report from GSMA claims new technology such as IoT will see mobile contribute 4% of GDP in region

The mobile industry is set to contribute more than $1 trillion a year to the North American economy by 2020, according to a new study from the GSMA.

The Mobile Economy: North America 2016 study claims developing technologies, such as 5G, the Internet of Things (IoT), smart cities and connected cars will see the industry make up around 4.5% of projected regional GDP within the next four years, up from 3.6% last year.

At the end of 2015, there was more than 284 million unique mobile subscriptions in the region, equivalent to 79% of the population, with this figure predicted to top 315 million (85% of population) by  the end of the decade.

The growth in mobile connections, most notably smartphones, which account for 75% of the regions devices, will fuel a growth of more than $300 million in additional net contribution between the end of 2015 and 2020, the GSMA claims.

The industry directly and indirectly supported more than 2.3 million jobs in the region in 2015, paying taxes of around $82 billion. More than $46 billion was also raised by regional governments through spectrum auctions held in the US and Canada.

“Thanks to the billions of dollars of investment made by mobile operators in their networks in recent years, North America is a leader in mobile usage and engagement, characterised by huge levels of mobile data consumption,” said Michael O’Hara, CMO at the GSMA. 

“The recent decision in the US to identify and open up spectrum for 5G services – alongside its leadership of the IoT market – has reaffirmed the region as one of the world’s most advanced mobile markets and one that is leading the next wave of mobile innovation.”

The report claims North America is driving mobile innovation in a number of key areas, including IoT and machine-to-machine (M2M) technology.

There was more than 60 million M2M connections in the region by the end of 2015, making up nearly 15% of total mobile connections. This share is predicted to double by 2020.

US operators are all investing in IoT and 5G networks to support the massive number of connections it is expected to bring. In February, AT&T unveiled its roadmap for 5G.

Verizon is also getting involved, having told GTB it is aiming to become of the first operators to launch the next generation of connectivity. In August, it announced a partnership with SK Telecom to develop 5G.