The 5G innovation economy will depend on a strong intellectual property system

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Presented by Qualcomm

Intellectual property (IP) is the linchpin driving fundamental innovation, enabling general purpose technologies such as 5G. The current US technology leadership has largely benefited from a robust IP system; but any effort to damage 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 is high on the agenda of most national leaders today. And without innovation there is no economic growth. Since the Nobel laureate Robert Solow, economists have shown that most economic growth comes from “technology shocks” or innovation. Innovation multiplies the productivity of each unit of input, such as labor or capital. As such, innovation is both critical to economic growth anywhere in the world and critical to driving large-scale economic growth.

A prime example of this innovation is the latest fifth generation or “5G” wireless technology. Those of us in the wireless industry don’t think of 5G simply as the next generation or “G” of wireless, but as a paradigm shift. Unlike previous Gs, 5G not only connects people, but everything everywhere – from smart homes to power grids, cars, transportation infrastructure, office buildings, factories, hospitals and more.

5G is the kind of innovation that multiplies productivity across industries, not just mobile. Such technologies, known as general purpose technologies, are not often found. Like electricity and the internet, 5G is a basic infrastructure that gives every industry a boost.

The economic and social impact of 5G

To understand the full economic impact of 5G across all industries, we recently conducted a study with Accenture and found that in the US alone, 5G will add approximately $ 1.5 trillion to GDP and up to 16 million jobs. Americans by 2025. More importantly, this innovation will act as an economic multiplier in every sector, including:

Manufacturing: 5G-enabled factories will achieve a 30% increase in overall productivity through improvements in assembly time, resource durability and defect detection. Transportation: New vehicle safety technologies and 5G-related infrastructure will reduce the severity of undamaged car accidents by 80%, saving lives and billions of dollars in collision costs, while reducing traffic by 25%. Healthcare: 5G will allow more post-acute health care to shift to home-based models, where cost savings are greater than 50% and patients will enjoy greater comfort and better outcomes. Utility: The impact of 5G on smart energy management will be profound, enabling greater coordination between electricity consumers, their devices and vehicles, and power plants. Additionally, smart sensors and drones will enable advances such as transmission line monitoring that will reduce forest fire risks, saving utility companies and users billions of dollars.

5G: an intellectual property success story

Governments around the world have understood the importance of innovation and research and development, noting that the adoption and promotion of 5G is directly related to their goals of technology sovereignty. The underrated element of this story is the critical foundation of 5G in IP, which has allowed 5G to thrive on a global basis.

In short, innovation is encouraged and protected by intellectual property laws, which allow individuals and teams to invent new technologies, collaborate with others to develop common standards, then implement those standards on a large scale around the world. The joint development of critical technology standards has been critical to the unprecedented success of wireless technologies such as 5G, which are universally adopted across countries, exploited by industries and enjoyed by consumers. Intellectual property laws allow inventors to disclose their inventions for the public good, in exchange for a temporary exclusive right to license and profit from their inventions.

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

Intellectual property laws depend on governments and benefit everyone

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

If we want to continue growing the innovation economy, we need legislation that supports a strong IP ecosystem. Strong intellectual property laws incentivize companies and inventors to invest in research and development and make the long-term bets needed to create technology shocks, which will multiply economic growth over time. We also need a global policy to strengthen international standardization bodies, supporting a fair and rules-based ecosystem where innovators and companies from around the world can work together to advance key technologies.

Just a couple of hundred years ago, the British economist Thomas Malthus predicted that humanity would fight for existence because population growth will outstrip the planet’s resources. Technology is a solution to this dire prediction, allowing once unthinkable levels of efficiency in allocating resources and multiplying human production. Without the economics of innovation, it’s fair to say we wouldn’t be here today. To keep moving forward, we have no choice but to do it right and the best way to do it is to strengthen intellectual property protection and support continuous innovation.

Dr. Gupta is Qualcomm’s Vice President and Chief Economist with over 20 years of mobile phone industry experience in various roles ranging from engineering, product, litigation and politics. He recently spoke about the importance of 5G and IP in boosting the innovation economy in a virtual event hosted by The Economist; the video of the event is available here.

Dr. Gupta and her team provide economic analysis and thought leadership on global technology, intellectual property, antitrust economic policy issues, collaborating with various business units internally and a global network of experts, influencers and policy makers externally. He is also a senior consultant at the Washington DC-based think-tank, Center for Strategic and International Studies, and co-founder and executive director of IP LeadershIP, an industry coalition that provides data-driven dialogue and analysis on IP. and on innovation policy.

Dr. Kirti Gupta holds an MS in Electrical Engineering from Purdue University and a Ph.D. in Economics from the University of California, San Diego. He has published extensively in political, law and economic journals and holds over 50 patents in the field of wireless communications.

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