Ericsson study: Quadrupling Egypt broadband speed can boost GDP by more than $1bn

Significantly, while doubling the country's broadband speed would lead to a 0.3% increase in GDP worth almost $688.59m, quadrupling Internet access speeds would add approximately $1.377bn or a growth of 0.6%. The study also shows that additional doublings of speed can yield corresponding GDP growth stimuli.

According to analyst firm Business Monitor International (BMI), there were 4.430 million broadband users recorded in the country as of 2011, with the number projected to rise by 3.84 million to 8.276 million users in 2016.

"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 Egypt have clearly recognized the importance of broadband and this is reflected in their collective efforts to achieve higher penetration across the country through fixed and mobile broadband solutions."

Both broadband availability and speed are strong drivers in an economy. In 2010, Ericsson and Arthur D. Little concluded that for every 10 percentage point increases in broadband penetration, GDP increases by 1%.

This growth stems from a combination of direct, indirect and induced effects. Direct and indirect effects provide a short to medium term stimulus to the economy. The induced effect, which includes the creation of new services and businesses, is the most sustainable dimension and could represent as much as one third of the mentioned GDP growth.

This study is the first of its kind in that it quantifies the economic impact of increases in broadband speed in a comprehensive scientific method using publicly available data.