Faster broadband to deliver $8.3bn to GCC economy

Research calculates economic benefits from quadrupling internet speeds in GCC
Research reveals major economic benefits of broadband.
Research reveals major economic benefits of broadband.

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Quadrupling the speed of broadband in the Gulf region has the potential to contribute an additional 0.6 percent to the nation's GDP, new research has claimed.

The findings are based on research jointly conducted by Ericsson, Arthur D Little and Chalmers University of Technology.

It said quadrupling internet access speeds would add approximately $8.356 billion to the economy.

In the final quarter of last year, operators in Saudi Arabia, Qatar and the UAE launched Long-term evolution (LTE) networks, also called 4G.

Earlier this year, Oman's Nawras said testing had started on 4G technology which is able to deliver high speed data downloads including high definition (HD) broadband and mobile TV services.

In Bahrain, 4G is slated to be launched in the first quarter of 2013.

"Broadband has emerged as a significant driver of economic growth even as we continue to evolve from an information society to what we, at Ericsson, call a networked society," said Anders Lindblad, president, Ericsson Region Middle East and North Africa.

"There is no doubt in my mind that broadband, whether mobile or fixed-line, is a vehicle for economic growth, innovation and productivity."

He added: "The government and telecom operators here in the GCC have clearly recognised the importance of broadband and this is reflected in their collective efforts to achieve higher penetration across the region through fixed and mobile broadband solutions."

Mobile subscriptions in the Middle East grew at a rate of 69,230 new connections per day in the first quarter of 2012, according to Ericsson.

Its second Traffic and Market Report said that a total of 6.3 million new connections were added across the region from January to March, taking the total number of subscriptions up to 266.3 million.

According to the study, mobile subscription penetration in the Middle East stood at 96%, compared to 69% in China and 97% in North America.

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