A Wireless Wake-Up Call for Finland
From this little-known university town at the northern end of the Gulf of Bothnia, an army of Nordic computer nerds looks poised to overrun America’s Internet innovators and software supremos as the desktop-dominated world goes wireless.
Nowhere has mobile communication caught on as it has in sparsely populated Finland, where nearly 70% of the 5.3 million residents are armed with wireless phones and an ever-expanding array of tools, games and services they can use on the fly.
Mobile communications have changed the way Finns work, play and see themselves in the world. This modest country once better known for global supremacy in suicides and heavy drinking is taking the lead in developing Internet-accessible handsets and services that will let consumers carry the power of a personal computer in their pockets.
Although the phones can’t do all that a home PC can, Finnish companies have soared to the forefront with services that allow users to check news, sports and weather wherever they are, as well as read their horoscopes or biorhythms, order food, pay bills, buy Christmas presents and collect e-mail.
“What you see happening here today will be happening in other markets very soon. We’re just a year or two ahead of other Europeans, and Europeans are just a bit ahead of the United States,” says Olli-Pekka Kallasvuo, chief financial officer for Nokia, the world’s largest wireless communications provider.
Only about 25% of U.S. citizens own mobile phones, compared with about half the European population. Finland’s current 67% market penetration is expected to exceed 70% by the end of the year, a higher rate than in any other nation. Finland is followed by Hong Kong, Norway, Sweden, Israel, Japan, Denmark and Italy in the ranks of top cellular consumers.
Worldwide, mobile phones already surpass televisions and personal computers combined in terms of unit sales, says Kallasvuo, and they are expected only to grow in importance as people take the services of the Internet out of homes and offices and onto the open road.
Finland’s role in wireless development has been a boon for the country that only a decade ago was overly dependent on slumping wood-products industries and doomed trade with the Soviet Union.
Gross domestic product rose more than 30% in the five years after 1992 and is projected to post an additional 20% increase by the end of this year. Unemployment has dropped from 20% at the start of the decade to 10.5% now--a level not expected to change despite healthy increases in new jobs each year because of the specialized training needed for the country’s new high-tech focus.
Most of the credit for the positive economic figures goes to the explosive growth of wireless leaders such as Nokia and their support services.
“I believe this is the future, and we’ll be doing everything that we do on the Internet today on these,” says Juha Sipila, director of Fortel Invest, holding up Nokia’s 9110 model introduced in September. The multimedia communicator has rivals from Sweden’s Ericsson and Motorola of the United States.
“They’re still quite slow, but in the future they’ll be as fast as my PC,” says Sipila, an unassuming venture capitalist who is one of Finland’s new high-tech millionaires. “I use mostly wireless communications now. I can pay bills or read my e-mails while I’m waiting at the airport.”
Like many movers in this unlikely Nordic challenge to Silicon Valley, Sipila concedes that being in touch 24 hours a day has its downside, even when the tethers to the office are invisible. Executives who have business partners in California, 10 time zones away, can end up working from the moment they get up in the morning until bedtime because the possibilities of any time, anywhere communication have often progressed to obligations.
“I think in the future we will all get better at using this button,” Sipila says, pointing to the off switch.
Another local success story, JOT Automation President Jorma Terentjeff, agrees that mobile communications can be the workaholic’s opium but says not all users necessarily become addicted.
“It’s popular nowadays to talk about burnout, and I don’t want that to happen to my people,” says Terentjeff, who believes wireless communications should be liberating workers from the 9-to-5 grind, not extending it. “We all need time for hobbies and exercise. My mobile phone gives me the flexibility to combine work with skiing.”
Wireless operations also allow Terentjeff to custom-fit the work environment to his employees’ needs, he says, noting that one valued co-worker has negotiated a protracted maternity leave on condition that she keep an eye on her projects via wireless conference calls from home.
A Heart Symbol Says It’s His Wife Calling
The booming sales of wireless fashion accessories, such as the rainbow assortment of cloth pouches and snap-on plastic phone covers on sale at niche boutiques throughout Finland, testify to the personal relationship Finns have developed with their mobile phones.
“What customers are looking for is not just a means of communicating but of defining their personality,” says Esa Mangeloja, telecommunications analyst at Conventum Securities in Helsinki, the capital. “You can choose the ring tones you like and customize the display with some identifying symbols, as well as choose colors and styles that suit you.”
His own phone rings to the tune of an ancient Finnish gospel song and is marked with his initials and a Lutheran cross. For those who find ringing too intrusive, most mobiles can now be outfitted with a vibrating option. Services such as call waiting and caller ID can also be customized. One Helsinki executive’s mobile displays a heart-shaped symbol to tell him it’s his wife calling.
Beyond bringing co-workers, friends and loved ones within a speed-dial of one another, Finland’s pioneering role in wireless technology has put the country on the global map and made Finns more self-confident and proud of their homeland.
“Even five years ago, when Finns traveled abroad we felt a little ashamed of ourselves, like we should apologize for the intrusion,” says Matti Latva-aho, the affable young director of Oulu’s Center for Wireless Communications. “Now we feel we’re in the spotlight of an important international development.”
The wireless center is the cornerstone of the town’s Technopolis, which groups together private and government research and development operations. The center, part of a sprawling research park adjacent to the University of Oulu, contracts with private industry to design and test new applications--and takes its cut of the profits of the most successful products.
At the privately owned Elektrobit firm in Technopolis, managers are leading by example. The company, which produces base stations, satellite communications and testing and measurement equipment, was the first in Finland to construct a headquarters entirely devoid of conventional phones.
Instead, every employee has a mobile handset with access to the internal computer network. Half a dozen of Elektrobit’s spun-off one-man-wonders operate in the hinterlands of the country, living examples of the virtual development possible in a wireless world.
“If you’re doing design work or engineering, it’s sometimes more productive to work alone, and it doesn’t really matter where you are if you can be reached,” says Elektrobit’s marketing manager, Juha Auer. “We have a lot of key people who don’t want to live in Oulu for whatever reason--a spouse’s job or kids in school. By working remote, everyone is satisfied.”
Oulu is perhaps the town to benefit most from Finland’s high-tech successes. Nokia’s research and development facilities are here, and the company’s meteoric rise in the early 1990s inspired related industries to locate nearby. The University of Oulu, long a teacher-training institution, has reinvented itself over the past decade to prepare the next generation of engineers and programmers.
“In Europe alone, 500,000 people are needed in technology industries, and in the next few years that demand will rise to 2 million,” says Lauri Lajunen, president of the 13,000-student university. But he contends that it is a difficult sales job to lure the best minds to Finland, “even though once they are here, they realize it is not Siberia.”
This flat, wind-swept town--even farther north than Nome, Alaska--does evoke the atmosphere of Slavic hinterlands, with its birch forests, spare wooden houses and early-afternoon twilight. But residents here tout their easy access to the best of all worlds: skiing in Lapland just a couple of hours’ drive north, business in Helsinki only an hour away by air, and daily commuting to work increasingly reduced to linkups via mobile modem.
Finland’s phenomenal rise from relative poverty followed in the comet trail of Nokia, the 134-year-old company that left its traditional pursuits of tire and rubber-boot manufacturing only a decade ago to focus on wireless communications. Nokia, Ericsson and other Nordic telecom leaders prospered from early recognition that a common standard for mobile phones and roaming agreements among service providers would allow all wireless customers to reach one another, regardless of location or which brand of handset they own.
“It’s a wireless world now, and standardization in Europe has really created opportunities here,” says Jari Raappana, marketing director of Stonesoft, a network security and information management firm near Helsinki. “We lost the Internet growth to the United States, but wireless is a good opportunity for Europe--something in which we can be the world leader.”
Finland and Scandinavian countries were also far ahead of the rest of Europe in deregulating telephone companies, which fostered a more competitive climate among service providers than in countries where state monopolies had little incentive to invest in research and development.
Telecom executives forecast that 1 billion mobile phones will be in use around the world by 2003, but the real growth potential lies in the new services emerging almost daily from Finnish entrepreneurs, says Jari Jaakkola, a vice president of Sonera, Finland’s telecom leader and the country’s second-largest company after Nokia.
For instance, a canceled flight might soon trigger digital messages to a traveler’s phone with alternative bookings or options for overnight accommodations.
With the business community here already fully supplied with cellular phones, sales are growing most rapidly among Finnish teenagers, who have turned what many of their parents intended to be a security tool into an instrument for self-expression.
More than 80% of Finns between the ages of 12 and 20 carry mobiles, and preset limits on how many minutes they can use them have become a kind of allowance negotiated between parents and children.
“My mother gets very angry if my bill is over 100 markkas,” says Petra Paananen, a 13-year-old browsing among the displays of covers and pouches at the Forum shopping center in Helsinki, citing a sum equal to about $18 a month.
Some Worry Wealth Is Polarizing Society
Like many teens, Petra was given her mobile handset as a present by her parents so they can be reached any time she needs their advice, comfort or permission. But more often than phoning home, she spends her e-allowance on the Short Message System, an adolescent rage in Finland. The 160-character limit on messages has inspired teens here and in other countries to invent their own codes to convey longer ideas with minimum keystrokes, such as BTDT (been there, done that), CUL (see you later) or GAL (get a life).
While the mobile madness has mostly been a boon, some observers fear that the explosive growth of new wealth has polarized Finnish society and deepened the despair of those made jobless by the decline of traditional industries, such as pulp and paper mills and mining.
“The nouveaux riches are not hiding their wealth, and in Finnish culture we’re not used to that,” says Antti Kokkonen, managing editor of Oulu’s daily Kaleva. “A lot of people here still think everyone should be equal.”
Despite his concerns, the editor applauds the opportunities and economic growth that have been created by the success of wireless in Finland.
The country has even overcome its infamous No. 1 world ranking in suicides, witnessing a 9% decline since the late 1980s, probably as a consequence of the surging economy and a national suicide prevention project.
The only risks from the wireless boom, says Kokkonen, are disappointing sales volumes if the new generation of Internet-accessible phones fails to lure consumers from their home computer rooms, or if the claims of U.S. researchers that excessive mobile use can cause cancer are substantiated.
“People in Finland don’t take this too seriously,” Kokkonen says of the alleged health dangers. “That’s quite obvious from the number of people you can see walking around with a phone stuck to their ear.”
