Oftentimes, one of the sharpest tools in a buy-here, pay-here dealership’s arsenal is using GPS devices to track their collateral in an effort to maintain with customers or begin the repossession process.
But what if GPS suddenly became unavailable because of a global outage? A comprehensive study conducted by RTI International (RTI), a nonprofit research institute, and commissioned by the National Institute of Standards and Technology (NIST) considered that possibility.
Researchers found though uncommon, a GPS outage could potentially have an economic impact of $1 billion a day. The study also found that economic impacts vary according to industry, time of year and point in the outage cycle. For example, if an outage occurred during critical planting seasons for farmers, the impact could be as high as $45 billion.
To date, the study showed GPS outages have lasted less than one day.
But imagine a month? The research report noted: “In addition to the economic impact of losing navigation services, a 30-day GPS outage will also have consequences for non-navigation applications.
“However, it is difficult to predict what those consequences will be ahead of time because, depending on how quickly app developers respond to the outage, it is possible that many applications that use GPS location but do not depend on it for complete functionality could switch to a reasonable alternative, such as using cell-tower triangulation for a very general location.”
Overall, the study found the economic benefits of GPS show 10 key industries generated $1.4 trillion since GPS was made available for private-sector use in 1983. About 90% of this figure accrued after 2010, according to researchers.
The 10 private-sector industries measured include agriculture, electricity, finance, location-based services, mining, maritime, oil and gas, surveying, telecommunications and telematics.
“Hundreds of millions of users rely on GPS every day from people driving to some place new to multinational corporations coordinating complex logistics networks,” said Alan O’Connor, director of innovation economics at RTI. “What is sometimes lost is the real economic benefits relating to GPS. Improved navigation reduces miles driven. We are still realizing the full potential of GPS functionality.”
In addition to discovering economic impacts, the study presents an analysis of the potential economic damages from a GPS outage, as well as federal activities and technology that helped the development and deployment of private-sector GPS use.
“This study shows the substantial value the United States can create from its investment in research and development,” said Walter Copan, Under Secretary for of Commerce for Standards and Technology and NIST Director. “When GPS was made available for civilian use, no one could have imagined how much our economy and daily lives would come to depend on it.
“Today’s R&D has untold potential, which is why we must ensure that the nation has effective policies and practices that support the efficient transfer of innovation from the lab to the market,” Copan went on to say.