Introduction: Research problem
How is 4G technology going to impact on commercial interactions, economic growth, and US competitiveness?
In a bid to sustain the achievements made in the era of 3G technologies and foster efforts of economic recovery, the United States of America should stay abreast with the rest of the world by deploying 4G technology in its communication infrastructure. Being a world leader in the broadband applications, companies in the United States of America enjoy the efficiencies that come alongside the platform of these technologies. As compared to other economies in the world, it has the greatest 3G subscribers. Therefore, it is true to argue the mobile broadband is of paramount importance in the United States economic growth and global competitiveness. That is the reason why most policy makers are considering this technological frontier as one of the influential aspects of economic growth. The far-reaching effects of 4G technology cannot be neglected in most businesses. In the same magnitude through which 3G technology transformed the way of doing business, 4G technology is bound to take the business a notch higher (Tuttlebee, 2005).
Mobile broadband successes attained through the glamour of 3G have established a platform through which 4G will scale greater heights in fostering business performances. Therefore, efforts to maintain and expand emergence of 4G technology within the economy should be encouraged. The foundation established by 3G has created a firm ground through which 4G will advance.
The investment on 4G networks is likely to be in the range of between $23 and $53 in the period between 2012 and 2016. The investment in the 4G technology mobile broadband stand high chances of spurring American performance in the international scramble to exploit the possibility of this innovative infrastructure. This will end up benefiting the national economy due the huge expenditure by wireless companies, suppliers and employees of these organizations. The growth of these organizations will have a direct impact in business scope (Mumford, 2010). The scope of this paper will limit the focus on these weaknesses to how the growth and development of 4G technology may be detrimental to economic growth, commercial interactions and competitiveness of the United States.
The evolution and popularity of mobile communication devices like cell phones, laptops and personal Digital Assistants have revolutionized mobile applications through fast growing networks. A myriad of applications associated to these applications for end users offer unlimited options for sharing and transferring information and data. The latest development in mobile network is that of 4G whose deployment is poised to have far-reaching consequences on various aspects of life including business, entertainment, sports, marketing and health care among others. These developments are further enhanced by multimedia communication brought about by World Wide Web (August, Hansen, & Shriver, 2001).
This inquiry seeks to establish the possible impacts that will come alongside 4G technology in shaping commercial interactions, economic growth and economic competitiveness of the United States of America. It seeks to ascertain these facts by reviewing what others have said about the topic. By the end of it, there should be a comprehensive knowledge to make a conclusion about the imminent impact of 4G technology.
4G mobile broadband is capable of supplementing other fixed broadband as a way of incorporating marginalized factions in the mainstream economic activities. This ends up serving the general public interest and thus increasing competitiveness (Rao, Weber, Gollamudi, & Soni, 2009). It achieves this by decentralizing the power of information from the traditional information holders to anyone who has an access to mobile broadband powered by 4G technology. This will solve the vicious problem of some disadvantaged markets like those of minority groups, rural dwellers and locations with little or no broadband connectivity. For low-income populations, deployment of 4G technology is capable of sufficiently solving the problem that holds back employability because mobile wireless devices are affordable and easy to operate that desktops and laptops (Raj, Ravichandiran, & Vaithiyanathan, 2010). Furthermore, 4G avails more functionality options than what 3G does. In this regard, the U.S. economy will benefit by unlocking opportunities, which could have been foreclosed by inferior communication infrastructure.
Collins (2010) argues that mobile operators have been forced to work together due to an upsurge in smart phones uptake resulting in an increase in data transmitted through their networks. They have been bracing themselves for 3G consolidation as they prepare for a shift to 4G technologies. However, the NGMN Alliance is skeptical about the cost implications of switch from the current 3G technology to revolutionary 4G mobile broadband. This condition calls for partnership amongst the operators thus creating a competitive merger in the communication sector (Collins, 2010).
Among the many applications occasioned by 4G mobile broadband is the ability of users to search the web using mobile phones. Web search through a device like a mobile phone has associate problems. These problems are associated with the insufficient interface. Since the displays of current devices are limited, search results cannot be examined effectively in an attempt to explore the relevant resources. This limitation may end up reducing the popularity of this application whose stake in GDP growth is substantial. This implies that there will be a drastic shift in the entire United States economy.
If the United States moves swiftly in deploying 4G networks, the country’s entrepreneurial innovation businesses are going to capture these opportunities before other nations catch up. Thus, enhancing commercial interactions in a manner that prompt job creation and productivity. Support for the suggestion that timely deployment of 4G networks is able to stimulate market response and worthy cycle of investment is evident in the improved features of 4G technology together with cloud infrastructure and developments in other related areas like chip manufacturing, micro sensors, and displays. These avails the foundation for creation of new devices and services that will go a long way in changing the manner in which organizations, individuals and households function (Bienaimé, 2010).
The motivation and structures for developing these new devices and services is already established by 3G era, which saw entrepreneurial innovation ecosystem assume a new shape. Since the developers are increasingly becoming capable of renting cloud computing, they are able to analyze new 4G applications, solutions, content, and business models quickly and cheaply. The new services and devices occasioned by the improved features of 4G networks and associated technologies promotes commercial interactions among organizations, people and machines. As the 4G mobile broadband deployment gets underway, it can allow interactions that are more similar in ways that are more efficient. Raising the standards of communication, business transactions, and innovations are the possible results of 4G broadband deployment. These aspects of the economy will translate to improving productivity and eventual increase in Gross Domestic Product. The ease at which information will be relayed between various business quarters makes it easy to transact business in what was once a reserve of a few. The improved efficiency and quality of conveying information can improve employment rates by stirring demand and formation of new businesses. This will culminate in strengthening the United States economy, as well as its global competitiveness.
The global competitiveness that come alongside 4G broadband technology can only be achieved and maintained if policymakers strive to pursue similar approach as that realized in 3G where the government is committed to creating an enabling environment to the creation of market based developments. The level of success attained by 3G mobile broadband shows the effectiveness of an advance where the government in keen on enhancing potential high-tech wireless infrastructure through the creation of conducive environment where technological innovation can flourish. The most important requirement is that of ensuring enough spectrum supply and enabling market forces to take charge of market mechanisms (Hallam-Baker, 2006). In the next 10 years, the Federal Communications Commission and Commerce Department are working together to avail 500 megahertz of spectrum for the innovative mobile broadband technologies. Although the spectrum supply may not be sufficient, to keep the United States demand and supply of wireless spectrum. The growing spectrum opportunities in foreign markets open new windows through which the businesses of 4G domain may prosper globally.
The proposed improvement on current wireless technology is poised to have a new dimension of sophistication occasioned by Information and Communication Technology. In the commercial interaction frontiers, technology savvy will permeate in to the way of doing business and business communication. There is a possibility of attaining better interactions than ever before since the technology takes traditional wireless technology to new heights. High resolution and data transfers through the technology will open a new shape of business communication. An era of prompt and real time responses is imminent (Cai, Yang Li, 2010). Therefore, it is anticipated that the volumes and scope of business transactions will increase to equally unprecedented heights as the technology its self is. The ability of 4G devices to stream live communications through wireless medium is a new dimension through which marketers and sales personnel may reach their clients without physical movement (Tanwar, Singh, & Gour, 2010).
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Jaloun and Guennoun (2010) argue that although it is not yet defined clearly, 4G networks, which is proposed to support heterogeneous networks operating at 100mega bytes per second mobility data speed. Once this is attained, the transfer of information in the form of textual, verbal or video. If the wireless mobile evolution takes place in the same trend as it has been from first generation all the way to 3G, then 4G will only be better business tool if not the best. In this era where data availability and access is critical to business, taking a leadership position in 4G mobile broadband will enable American industries to enjoy dominance in a market characterized by competition and rapidly changing technology. Due to its glamorous history in wireless mobile technology, a further venture in to superior technology will hasten the pace at which the US economy has been relying on wireless technology.
International competition on the technological innovation in wireless frontiers is far from being a monopoly of the Unite States. Such nations as France, China, Korea, Japan and Singapore have resorted to adoption of national broadband plans encompassing policies and objectives designed to improve their current wire line platforms. One study reveals that more than 154 carriers in 60 nations have committed their resources to 4G deployment and test runs. Countries like Sweden and South Korea have established extensive 4G deployments (Passerini, Patten, Bartolacci, & Fjermestad, 2007). Conversely, China is a formidable force behind the development of 4G competing versions LTE and is on the lime light of pushing for technological ecosystem that may end up giving its vendors a competitive edge (Conti, 2010). Therefore, the United States stake in global 4G technology cannot underestimate the impact of global threat especially in highly conspicuous areas like mobile broadband. Nevertheless, if The United States will continue to capitalize on gains made in previous mobile broadband technologies like 3G and other inferior versions, then it will continue to scale the heights of dominance in this field.
Despite the fact that the future of 4G technology in impacting commercial interactions and fostering global competitiveness, the challenge of availing sufficient spectrum remains a challenge. Tablets, smart phones and other devices utilize the data of previous inferior cell phones thus posing a risk behind the curve in terms of satisfying the local demands. The National Broadband Plan of FCC points out that it has a staggering 50 MHz spectrum in its stock, which is just a portion of what the nation requires to meet its growing demands. This is an evident looming crisis in the sufficiency of spectrum. The commitment of the federal government in ensuring that there is sufficient spectrum to meet these demands is a true evidence of the impact in which wireless mobile technology is bound to have. However, there is no assurance that the efforts by the federal government will avert the looming crisis. Meanwhile, other nations like Japan, Germany and France are in a move to allocate more spectrum than what the United Sates is doing to commercial wireless services.
The efforts outline above by carriers, high technology industries and governments globally shows that the United States may not continue to enjoy leading position in mobile broadband anymore. The tough competition poses a threat to United States’ dominance. Whoever will secure the advantages accruing from this technology will not only enjoy substantial commercial benefits in the wireless sector but also in other economic sectors because they are interrelated. Even the effort to secure a substantive niche in global wireless market is bound to transform domestic business environment. The expenditure on global development and spectrum expansion implies that there will be modifications of GDP and employment rates.
The investment on 4G network has far-reaching effects on US economic competitiveness in a twofold. First, the speed and magnitude at which network investment is moving affects economic status of carriers, employees and suppliers. Secondly, these investments will also have an impact on personal and organizational budgets. The faster the said investment happens, the better it is for the United States, as they will take up a frontline position in mobile broadband space. This opportunity shows that there is a possibility of United States 4G network investment resulting in economic gains. Deloitte Consulting LLP predicts that the United States’ wireless traffic and associated expenditures for the period between 2012 and 2016 falls between 25 and 53 billion dollars. Although these projections are too hypothetical, they are useful in exploring the possible impact of 4G network deployment. Despite the fact that these amounts look outrageous, the impact is as well of the same magnitude. If the predictions by Deloitte happen, then the new offering will end up evoking positive responses from both domestic and global customers. The potential sizable increase in traffic will then justify the heavy investment outlay (Deloitte Consulting LLP, 2011).
The report goes on to postulate that the economic implications of the estimates above can be established accurately using industry specific multipliers. This makes it possible to predict how 4G network will shift the value of national GDP and employment rate. Since investment is a key driver for economic growth, it is from such resources outlay that an economy will increase its capital base, thus increasing productivity and global competitiveness through an increase in exports. The potential increase in exports through venture in to global space is only possible with the aforementioned investments. Therefore, if the prediction will occur as anticipated by Deloitte, then US competitiveness in international wireless broadband arena is not far from certain.
Heavy investments increase the level of employment rate, per capita income, tax revenue through the resultant increase in income base and work force. An increase in telecommunication investments raises overall capacity thus exerting downward pressure on consumer prices. The ultimate measure of the impact of these investments is the increase in GDP. To succeed in doing this, Deloitte Consulting LLP used multipliers of construction and wireless communication equipment. The two sectors are chosen because the shift in spending patterns on broadband networks have a direct impact on them. Weights used to obtain the hybrid multiplier are modified to suit the proportion of sending in the two categories. In 2009, wireless communication equipment weighting stood at 93% while construction had 7% of wireless broadband. The approach yielded multiplier factor of 2.873 suggesting that an increase in wireless broadband investments by $1 will result in $2.873 increase in the overall national GDP. On the same school of thought, the estimated wireless broadband job multiplier from hybrid approach is 14.67. Thus for every, $1 investment in wireless broadband goes a long way in creating 15 job opportunities in the United States (Deloitte Consulting LLP, 2011).
From the analysis of literature outlined above, it is clear that the impact of 4G technology is considerably turbulent. It is constrained by both the amount of money invested and timeliness of executing the deployment. Whatever the amount that the players in this industry decides to invest, it is imperative that the ultimate impact has far reaching consequences on the manner in which people do business and United states competitiveness in global arena. Although 4G technology is yet to be deployed completely, interested parties have written a lot of proposals and articles concerning its potential impacts in the economic and commercial arena. This shows that there are many interests in the technology because of its impacts. With regard to commercial interactions, it was revealed that the technology would raise the level of communication due to advanced application of data transfer through wireless networks. There is no doubt that the economic growth is bound to increase If the players in the wireless communication sector will embrace 4G deployment in an equal passion as they did for 3G mobile broadband.
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