Presented by Qualcomm

Intellectual property (IP) is the lynchpin that drives foundational innovation, enabling general purpose technologies like 5G. The current U.S. technology leadership has largely benefited from a strong IP system; but any effort to impair the IP system will put us at risk of losing our global leadership position.

As the global economy recovers from the COVID-19 pandemic, setting appropriate policies for economic growth tops the agenda for most national leaders today. And without innovation, there is no economic growth. Starting from Nobel Laureate Robert Solow, economists have demonstrated that most of the economic growth comes from “technological shocks” or innovation. Innovation multiplies the productivity of every unit of input, such as labor or capital. As such, innovation is both fundamental to economic growth anywhere in the world, and key to driving economic growth at scale.

A great example of such innovation is the latest fifth-generation, or “5G” wireless technology. Those of us in the wireless industry do not think of 5G as simply the next generation or “G” of wireless, but as a paradigm shift. Unlike the previous Gs, 5G doesn’t just connect people, but every-thing everywhere: from smart-homes to electricity grids, cars, transport infrastructure, office buildings, factory floors, hospitals, and more.

5G is the kind of innovation that multiplies the productivity across various industries, not just mobile. Such technologies, known as general purpose technologies, do not come around often. Like electricity and the internet, 5G is an underlying infrastructure that gives a boost to every industry.

5G’s economic and social impact

In order to understand 5G’s full economic impact across industries, we recently did a study with Accenture and found that in the U.S. alone, 5G will add around $1.5 trillion of GDP  and up to 16 million American jobs by 2025. More importantly, this innovation will serve as an economic multiplier across every industry, including:

  • Manufacturing: 5G-enabled factories will achieve 30% overall productivity gains through improvements in assembly time, asset life, and defect detection.
  • Transportation: New 5G-connected vehicle safety and infrastructure technologies will reduce the severity of non-impaired car crashes by 80%, saving lives and billions of dollars in collision costs, while reducing traffic by 25%.
  • Health care: 5G will allow more post-acute health care to transition to home-based models, where cost savings are greater than 50%, and patients will be able to enjoy greater comfort and better outcomes.
  • Utilities: 5G’s impact on smart power management will be profound, enabling greater coordination between electricity consumers, their devices and vehicles, and power stations. Additionally, smart sensors and drones will enable advancements such as transmission line monitoring that will reduce wildfire risks, saving utility companies and users billions of dollars.

5G: An intellectual property success story

Governments across the world have realized the importance of innovation and R&D, noting that embracing and fostering 5G is directly related to their technology sovereignty goals. The underappreciated element of this story is 5G’s critical foundation in IP, which has enabled 5G to flourish on a global basis.

In short, innovation is incentivized and protected by IP laws, which enable individuals and teams to invent new technologies, collaborate with others to develop common standards, then deploy those standards at scale around the globe. Joint development of critical technology standards has been key to the unprecedented success of wireless technologies such as 5G, which are universally adopted across countries, leveraged by industries, and enjoyed by consumers. IP laws enable inventors to disclose their inventions for the public good, in return for a temporary exclusive right to license and profit from their inventions.

Strong IP protection is the reason that the wireless industry has enjoyed unparalleled growth throughout the years, establishing a healthy and vibrant ecosystem, and delivering myriad of products and services that the consumers depend upon. Qualcomm has worked for decades as the R&D engine for the industry — a horizontal enabler, creating a level playing field for others to enter the wireless market using innovations developed in our labs. Many of the leading global smartphone OEMs come from businesses other than wireless. They were able to license the technology, enter the market, and became successful within a relatively short period of time, all without having to start from scratch with significant R&D investments. Today, Qualcomm’s latest connectivity innovations have been licensed by numerous small and large OEMs, enabling anyone to become the next 5G success story.

IP laws depend upon governments, and benefit everyone

Small firms, startups, and individual inventors rely heavily on IP laws to protect their ideas, and thus attract venture capital. Without IP laws, only big and powerful companies — in some cases backed by governments — would have the ability to innovate. A world where future innovations are directed largely by large platform developers or states would create a less democratic, riskier, and poorer quality of life for everyone.

If we want to continue growing the innovation economy, we need legislation that supports a strong IP ecosystem. Strong IP laws incentivize companies and inventors to invest in R&D and make the long-term bets that are necessary to create technological shocks, which will multiply economic growth over time.  We also need a comprehensive policy to strengthen international standards bodies, supporting a fair, rules-based ecosystem where innovators and companies from around the world can work together to advance fundamental technologies.

Only a couple of hundred years ago, English economist Thomas Malthus predicted that humanity would fight for existence because population growth will exceed the planet’s resources. Technology is a solution to this dire prediction, enabling once unthinkable levels of resource allocation efficiency and multiplication of human output. Without the innovation economy, it’s fair to say that we would not be here today. To keep moving forward, we have no choice but to get it right, and the best way to do that is to strengthen IP protection and support continued innovation.

Dr. Gupta is the Vice President and Chief Economist at Qualcomm with over 20 years of experience in the mobile industry in diverse roles spanning engineering, product, litigation, and policy. She recently spoke about the importance of 5G and IP in powering the innovation economy at a virtual event hosted by The Economist; video from the event can be accessed here.

Dr. Gupta and her team provide economic analysis and thought leadership on global Technology, IP, Antitrust economic policy issues, collaborating with various business units internally, and a global network of experts, influencers, and policy makers externally. She is also a Senior Advisor at the Washington D.C. based think-tank, Center for Strategic and International Studies, and the co-founder and executive director of IP LeadershIP, an industry coalition providing a data-driven dialogue and analysis on IP and Innovation policy.

Dr. Kirti Gupta holds a M.S. in Electrical Engineering from Purdue University, and a Ph.D. in Economics from the University of California, San Diego. She has published widely in policy, law, and economic journals, and holds over 50 patents in the field of wireless communications. 

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