ict cluster finland - urenio.org · 2 ict cluster finland review during the past decade, finland...

ICT CLUSTER FINLAND REVIEW 2005

ven Knowledge Economy. Finland’s Technology Policy Yields Fruit. |global view|Again? |international cooperation| Finland and WSIS. ICT for Development – Canesource in Global Competition |communications| Broadband Connections and

mmunications| Ever Tougher Competition on All Fronts. Finnet Group – Believesd development| Information and Communications Technologies. New Businessgmas of lifelong learning in engineering education. Finnish Open Source – Flyinguality. Jyväskylä – Human Technology City Known for Its User Friendly Internetthe Resque of SME’s |investments in finland| Finland – Easy Going Markets andng Center – an Innovative Landing to Japan. New Era of Building Management.gh-Technology – AirBuccaneers. In the Cross Roads of Development – from “ICT-bal Information Society. Report on Finland in the Global Economy: Competence,and.fi. Welcome to the Meeting Point for Information Society Developers

T I E K E

ICT CLUSTER FINLAND REVIEW2

During the past decade, Finland has successfully built a dynamicdeveloping knowledge economy while maintaining the basiccharacteristics of the Nordic welfare model. The digitalisation hasincreased overall productivity in society and offered new marketopportunities for digital content producers and service providers.

In order to secure continuity of development and competitiveness,Finland will need to be able to produce specialised products andservices that are applicable to digital environment. A well recognizedunbalance still exists between manufacturing of digital products andcontent production. Meanwhile, the structures – economy, education,capital and even age – of the Finnish society are favourable to thechanges ahead.

Both the private and public sector will need to demonstrateinnovativeness, ability to adjust to new challenges and willingness toinvest. A precondition for further development is the cooperationbetween the two. The competitiveness of the Finnish ICT industrydepends on continuous monitoring of markets and consumerbehaviour and ability to change accordingly. The Information SocietyProgramme of the current Finnish Government works as a forumwhere a wide range of actors from different sectors are gathered todiscuss and make decisions on development of information society.The fact that the Finns have good information society skills enablesthe decisions to transform into actions.

TIEKE Finnish Information Society Development Centre has avital role in building Public Private Partnership networks andinitiating concrete projects to promote information society. Mostrecently progress has been made in developing eBusiness inFinland through our eInvoice Forum. The network promoteswidespread adoption and use of electronic invoicing nationally.One local effort is described on page 39.

In ICT Cluster Finland Review 2005 we have brought together avariety of Finnish actors to present their innovative ideas, productsand modes of operation, and examples of regional and state-levelinitiatives related to information and communication technology. Bydoing so, we hope to share useful information and introduce newpartners for continuous building of dynamic global information society.

Aatto J. RepoManaging DirectorTIEKE

| editorial |

Finnish Structures Favourable to Future Changes

Contents

4 ICT – Essential Tool for the Future

6 Finland An ICT-Driven Knowledge Economy

10 Finland’s Technology Policy YieldsFruit

12 Finnish ICT Developmentfrom the OECD Perspective

14 Why the Finns Again?

16 Finland and WSIS

17 ICT for DevelopmentCan Other Countries Learn fromthe Finnish Experience?

18 Know-How The Best Resource in GlobalCompetition

20 Broadband Connections andInformation Security

22 Enforcing the Security ofInformation in Finland

24 Ever Tougher Competition on AllFronts

26 Finnet Group Believes in the Powerof Locality

28 Elcoteq Establishing a Global Footprint

30 Information and CommunicationsTechnologies – New BusinessPractices and Innovations

32 How to Get on the Top of PISATower... and other enigmas of lifelong learning in engineeringeducation

3

34 Finnish Open Source Flying High from the VeryBeginning

36 Access to the Internet– A Matter of Equality

37 Jyväskylä – Human Technology City Known for Its User FriendlyInternet Site

38 eTampere Builds the Well-being ofthe Future

39 “eInvoicing LivingLabs” to theResque of SME”s

40 Finland – Easy Going Markets and HighlyEfficient Business Environment

42 Finnish Wellbeing Center – an Innovative Landing to Japan

44 New Era of Building Management

45 Ellibs – Europe’s Leading eBooksProvider

46 Northern Cultural Heritage Meets High-Technology – AirBuccaneers

48 In the Cross Roads of Development – from “ICT-simple“ to “ICT-complex”

49 Publications Pekka Himanen: Challenges of theGlobal Information Society

Report on Finland in the GlobalEconomy: Competence, Openness and Renewability

Best before 01012015

50 Finland in Brief

51 http://e.finland.fi

Welcome to the Meeting Point forInformation Society Developers

“Wide use of ICT is everyday life.

For instance, the number of Internet

users is high on the international scale:

80 per cent of the Finnish population is

familiar with the Internet and nearly

half of these people use it every day.”

ICT Cluster Finland Review 2005

Published by TIEKE Finnish Information Society Development Centre

AddressSalomonkatu 17 A, 10th floor00100 Helsinki, FinlandTel.: + 358-9-4763 0400Fax: +358-9-4763 [email protected]

Editor-in-Chief Aatto J. Repo

Editorial Staff Oili [email protected] [email protected] [email protected]

LayoutWorkshop Pälviä Oy

Printed byRaahen Kirjapaino Oy, Raahe 2005

Cover PhotosAirBuccaneers, Elcoteq, Ficora, Finnet, Lonix

ISBN 952-9714-38-6

Circulation25,000

Available on the Internet at www.e.finland.fi and www.tieke.fi (pdf)

4th volume

TIEKE Finnish Information SocietyDevelopment Centre has a key networkingrole as a neutral and non-profit organisationin promoting the efforts of its members, wit-hin the public and private sectors alike, withan ultimate goal to create viable tools andexpertise for use in the information society.

Legal noticeNeither TIEKE Finnish Information SocietyDevelopment Centre nor any person actingon behalf of it is responsible for the use thatmight be made of the information in thepublication.Content and copyright of the articles,graphics and photos published in ICT ClusterFinland Review 2005 are owned by the com-panies who are also responsible of their ownproduction in this publication.

T I E K E

ICT CLUSTER FINLAND REVIEW 2005


in international comparison. Finland is one of the topcountries in regard the use of electronic services in publicadministration.

Wide use of ICT is everyday life. For instance, thenumber of Internet users is high on the international scale:80 per cent of the Finnish population is familiar with theInternet and nearly half of these people use it every day.

According to the report, the aim is to stay on the top ofinternational information society development in thefuture as well. The goal is also to develop the informationsociety on the basis of the Finnish model in order to makebenefits of the information society available for companiesand the entire population as widely as possible.

For companies, for industry, and service producers, theadvanced use of ICT and the well functioning of theinformation society are essential tools for the future. Ithas been estimated that ICT accounts for 40 per cent oftotal productivity growth on the European Union level, butit could give a much greater contribution if it were morewidely adopted. For example, in the United States ofAmerica ICT accounts to 60 per cent of total productivitygrowth.

It can’t be enough emphasized that the use of ICT andefficient functioning of related infrastructure is at the coreof making Finland, and the whole EU, a more competitiveknowledge-based society.

The Lisbon strategy, as the aim of making Europe themost competitive and dynamic economy in the worldplaced information society issues at the top of the agenda.The strategy included drawing up an eEurope Action Plancontaining several actions to be performed. ICT wasidentified as playing the key role in achieving theobjectives. Progress has been achieved in many of theseareas at both the EU and national levels, but still the workis far from complete.

Now, the Commission has undertaken a new effort andgiven a new start for the Lisbon strategy. It includes againsignificant proposals on ICT. The Commission has alreadystarted preparations for a renewed eEurope Action Plan.

We urge you all to be the engine to make theseactivities run and reach our goal for Europe to be a goodplace for its citizens and the most competitive economy inthe world.

inland has been resolutely developed into an informationsociety over the course of several years. As the

information society has advanced, changes have beenexperienced by production, working life, training,distribution channels, consumer habits, and everyday life.The new applications of information technology have had amajor impact both socially and economically. Citizens areexpected to master new equipment-skills. Companies havebecome users and providers of a different type ofinformation technology.

The ICT sector is constantly growing and developingglobally. E-commerce has taken a big share of the sales ofproducts and services.

Finns can use information networks for their everydayactivities in a great number of ways. Bank transactionsand dealing with government departments can be handledonline, as well as purchasing airplane or concert tickets. InHelsinki, tram tickets can be ordered with a mobile phone.

The Finnish government has also been actively engagedin the information society issues. The Information SocietyCouncil of Finland, chaired by Prime Minister MattiVanhanen, published its first report in February 2005. Inthe report, the Council reviews the current informationsociety development and ensuing challenges in Finland. Italso outlines measures to address these challenges.

Indicators show that Finland is among the mostadvanced countries in the world with regard to education,research, and product development. Finland scoresexceptionally high marks in school learning outcomes.Investments in research and product development are high

|introduction|

ICT – Essential Tool for the Future

“Indicators show that Finland is among the

most advanced countries in the world with

regard to education, research, and product

development.”

Leif Fagernäs, Director General | Confederation of Finnish Industries

F

5

Finnish Industry Speaks With One VoiceInternationalisation and globalization have forced nationsand firms into harder and harder competition. This isespecially challenging for a small country like Finland. Weneed unparalleled knowledge, entrepreneurship, andsustainable structures for our society in order toovercome the challenge.

With these challenges in mind the Finnish businesscommunity founded the Confederation of FinnishIndustries EK in the spring 2004. Finnish companieswanted to concentrate their strengths in one organizationand speak with one voice at home, in the European Union,and on other international forums. Before EK themanufacturing and service industries were represented byseparate organisations. EK officially began its activities onJanuary 1, 2005.

The Confederation of Finnish Industries EK is theleading business organisation in Finland. It represents theentire private sector, both industry and services, andcompanies of all sizes. Its member companies stand formore than 70 percent of Finland’s GDP, and over 96 percent of the export from Finland.

EK covers 43 different branch federations with amembership of 15 000 companies in all, which employabout 900,000 employees. EK is a member of UNICE (the Union of Industrial and Employers’ Confederations ofEurope), BIAC in the OECD, and IOE in the ILO.

EK’s task is to create a better and more competitiveoperating environment for companies and the businesscommunity in Finland. The mission is to improve thecompetitiveness of companies in Finland. EK’s vision isFinland as the most competitive country in Europe andone of the most competitive countries in the world. ❙

EK is the leading business organization in Finland. It represents theentire private sector, both industry and services, and companies ofall sizes. www.ek.fi


|overview|

he Finnish experience in the 1990s repre-sents one of the few examples of how

knowledge can become the driving forcein economic growth and transformation.In a less than a decade the country becamethe most ICT (Information andCommunication Technology) specializedeconomy in the world.

Structural Change of the 1990s – the Basis of the Knowledge EconomyIn the beginning of the 21st centuryFinland has been ranked three times onthe top in World Economic Forum’s(WEF) competitiveness studies, as one ofthe most developed IT economies, andalso number one in OECD’s PISA(Programme for International StudentAssessment) studies of youths’ learningskills and educational attainment. In addi-tion, the country was able to produce suc-cess stories like Linux Operating Systemand Nokia that grew into global scale dur-ing the 1990s.

In the beginning of the 1990s, Finland’sprospects seemed much gloomier. Thecountry was hit by the most severe eco-nomic downturn in any OECD countrysince the World War II. GDP fell by 10 %in just three years and unemployment rosefrom 3 to 17 %. The recovery was, how-ever, fast and based on major industrialrestructurings. The most important factorwas the phenomenal growth of ICT pro-duction. But also the more traditionalindustries – like pulp and paper and engi-neering – renewed themselves by makingtheir production processes more produc-tive. The economy went through abetween-industries and within-industrystructural change. In between-industrytransformation the immense growth ofelectronics – i.e. telecommunicationsequipment industry – was the key. Within-industry change was that of creativedestruction – almost in all industrial sec-

tors large part of low productivity plantswere closed down.

As a consequence, by the end of the1990s the productivity level of manufac-turing was among the highest in theworld, and the ICT sector played themajor role in the economy. Finland wentfrom being one of the least informationand communication technology (ICT)specialized countries to becoming the sin-gle most specialized one. This is exception-al. In ICT laggards rarely catch up, letalone leapfrog, the leaders. Probably goodluck and wise policies were needed.

Indeed, there were major changes inpolicy thinking. Today, acknowledging theunderlying causes of the early 1990s reces-sion, greater emphasis is put on longerterm microeconomic as opposed to short-term macroeconomic policies – the foun-dations of sustained national competitive-ness are largely created at micro level, i.e.in firms, financial institutions, and variousinnovation policy agencies.

Finnish Knowledge Economy in an International Perspective Competitiveness indicators, like that ofWEF, predict relatively poor future growthperformance of economies, but they maygive useful hindsight on the various fac-tors that have contributed to the competi-tive edge and well-being of nations.Undoubtedly, the most important onesinclude strong commitment to education,high-level technological infrastructure,well-functioning public institutions,openness of the economy, and integrationinto the international trade blocs. Buttoday also more importantly factors suchas network readiness, research and creati-vity, strong social cohesion, and sustain-ability of environment. An importantissue is also adaptability and commonacceptance of change – often typical ofsmall countries.

No doubt, high-level education system,developing information and communica-tion infrastructure, and increasing publicand private investment to R&D had theirrole in the industrial transformation of thecountry.

Education is the key, however.Educational attainment in Finlandincreased significantly throughout the1990s. Enrollments in universities and other higher education rose significantly,and today younger generations are amongthe highest educated by any standards. Thecountry was showing extraordinarydynamism and high social cohesion at thesame time. By the beginning of the newmillennium it was among the high per-formers by almost any economic andknowledge economy indicator.

The overall picture and comparisonsacross various regions and countries is given in Figure 2. It ranks Finland on thetop in knowledge economy developmenttogether with other Nordic countries andNorth America. It also tells that there isstrong persistence – at least over the medi-um term – in the group of most developedcountries. Taking a bit longer horizonFinland stands out, however, also as anexample of structural change, transforma-tion – and actually relatively quick turn-around – as discussed above.

The background of the major structuralchange lies in the economic and social sys-tem that has developed over decades.Smallness, homogeneous society, and ability to seek consensus when needed,might also be important explanations forknowledge economy developments.

Small Nordic Economy and Welfare StateFinland can be appropriately characterizedas a Nordic welfare state: an egalitariancountry with relatively even income distri-bution, low class distinctions, and relative-ly high social cohesion.

FinlandAn ICT-Driven Knowledge EconomyPekka Ylä-Anttila, Research Director | ETLA – The Research Institute of the Finnish Economy

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Figure 2. Global View to Knowledge Economy – Knowledge Economy Index by countries and regions,1995 and the most recent year Source: World Bank - Knowledge Assessment Methodology. Knowledge economy index consists of76 structural or qualitative variables to benchmark performance of more than 120 countries (see www.worldbank.org/kam )

Figure 1. Finland in WEF (World Economic Forum) Competitiveness Rankings

Smallness is both an advantage and adisadvantage. There is some evidence inthe economic literature that smallness assuch might retard economic growth. Smallcountries have less scope for utilizing scaleeconomies in production and marketing.On the other hand, small home marketsdrive firms to specialize and seek foreignmarkets early on. Most small countries canbe described as open economies with largeexporting sector and high ratio of FDI toGDP. In Finland exports in relation toGDP is currently close to fifty percent.

Smallness and homogeneity of the soci-ety might also be beneficial for creationand diffusion of new knowledge in specificareas – like ICT. In the period of rapidtechnical change this could be a competi-tive advantage over larger countries.

Smallness and specialization increase acountry’s sensitivity to external shocks.Small economies have developed variousways to cope with the problem includingnot only macroeconomic policy measuresbut also many kinds of formal and infor-mal networks and social security systems.As argued by e.g. Rodrik (2004), opennessof the economy is often linked to socialsecurity systems designed to dampendown the risks arising from the highdegree of exposure to the external envi-ronment.

The Finnish economy can be character-ized as highly open, specialized, and net-worked. Networking and cooperation insociety in general, as well as in the businesssector and between industry and universi-ties in particular, have proven to be impor-tant in developing new information andcommunication technologies in Finland(see Romanainen, 2001). Of course, socialnetworks (or social capital more general-ly), can become too tight and finally anobstacle for social change and industrialtransformation, but so far the benefits ofnetworking and cooperation have been an

THE RESEARCH INSTITUTE OF THE FINNISH ECONOMY, ETLA

carries out research on economics, business and social policy as well as makeseconomic forecasts. ETLA's activities facilitate financial and economic policydecision making in the organizations sponsoring the Institute, Finnish companiesand the entire economy.

www.etla.fi/eng

Figure 3. Exports/imports ratio of high-tech products

0 1 2 3 4 5 6 7 8 91995

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8

7

6

5

4

3

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1

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Finla

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Sweden

Denm

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Fran

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Nethe

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Germ

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Belgium

Austri

aIta

lySpa

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2.5

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1.5

1.0

0.5

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GrowthcompetitivenessIndex (GCI)

1996 1997 1998 1999 2000 2001 2002 2003 2004

Nigeria

South AsiaIndia

Indonesia

Latin America

TurkeyMexico

Argentina

Russia

PolandSouth Africa

AfricaKenya

ChinaTunisia

Middle east and North Africa

Jordan World

East Asia

Chile

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Ireland Developed Oceani

Australia

USACanada

G7

Western EuropeJapanGermany

Finland

Europe and Central Asia

Brazil

Ghana

Pakistan

Mos

t R

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t


to concentrate and specialize and can nothave a well-diversified portfolio of interna-tionally competitive business activities.That, of course, includes major risks.These have to be responded by highlydeveloped social security and flexible eco-nomic and social structures.

Challenges and Challengers The wave of the information revolutioncoupled with the globalization process isposing serious challenges to both well-established knowledge-based economies aswell as emerging countries who want tobenefit from new technologies. Globalproduction patterns are changing whileleading producers of ICT goods and ser-vices are moving their production off-shore. China and East Asia are becomingthe most important production bases formanufacturers, including ICT goods.

Recent research seems to give evidencethat some Asian countries like China,South Korea, and Taiwan are specializing intheir production and foreign trade to simi-lar goods as Finland and other advancedICT producers. That is mainly due toincreasing foreign direct investment (FDI).Leading ICT multinationals have beengrowing their FDI in Asia and CentralEastern Europe. Consequently, some ofthese countries have become major playersin global export market for ICT goods, andincreasingly IT services too. Innovation isnot a domain of advanced markets anddeveloped countries either.

What’s Next? Although the original ICT boom was overin the turn of the new millennium, therevolution is not over. Quite the contrary.We see shifts in the global division of laboras new producers take their place in worldtrade and global production networks.Advanced countries are put into a hardercompetition and are forced to seek new

advantage rather than a disadvantage (cf.Castells and Himanen, 2002; Rouvinenand Ylä-Anttila, 2003).

Finnish ICT Cluster – It Is Not Nokia Alone The core of the Finnish knowledge econo-my is the Nokia-driven ICT cluster. Thebroadly understood cluster – from digitalcontent provision and packing via networkinfrastructure, equipment manufacturingand operation to end-user terminals andportals – is comprised of about 6,000firms, including 300 first-tier subcontrac-tors of Nokia.

The GDP share of ICT -cluster hasincreased from 4 per cent in 1990 to morethan 10 percent today. Nokia’s share is abit less than 4 percent. ICT cluster’s andNokia’s role are even more important instrategic areas like R&D and globalizationof business. ICT-related research accountsfor more than 50 % of all industrial R&D.

Nokia’s share in Finland’s total exportsis 20 %, i.e. as much as that of the totalpulp and paper industry. Due to extensiveexports of telecom equipments Finland’strade surplus of high-tech goods is amongthe highest in Europe. Also, there are sig-nificant spillovers from ICT sector to otherindustries in their international business.See figure 3.

Finland is quite dependent on Nokia,however. But at least now the Finnisheconomy has another major pillar along-side the traditional forest-based industries.What is more important, the economy hasproven its ability to adapt and transformfrom a resource-based economy to aknowledge-based one. As compared todependence on natural resources like oil orminerals, it seems plausible to argue thatthe knowledge accumulated in ICT sectorcould be more easily applied elsewhereshould anything go wrong.

Obviously, small economies have always

References:

Castells, Manuel – Himanen, Pekka (2002), The Information Society and the Welfare State. The Finnish Model.Oxford University Press.

Koski, Heli, Rouvinen,Petri and Ylä-Anttila, Pekka (2002), ICT Clusters in Europe – The Great Central Bananaand Small Nordic Potato in Information Economics and Policy, 14 (2002) 145–165.

Rodrik, Dani (2004), Industrial Policy for the Twenty-First Century. CEPR (Centre for Economic Policy Research)Discussion Papers No. 4767. www.cepr.org/pubs/dps/DP4767.asp

Romanainen, Jari (2001), The cluster Approach in Finnish Technology Policy. In OECD, Innovative Clusters –Drivers of National Innovation Systems. Paris.

Rouvinen, Petri and Ylä-Anttila, Pekka (2003), Little Finland’s Transformation to a Wireless Giant, in Dutta –Lanvin – Paua (eds), The Global Information Technology Report – Towards an Equitable Information Society.Oxford University Press with World Economic Forum. New York & Oxford.

ways of creating value in the global digitaleconomy.

The focus will be in new applicationsand opportunities given by digital conver-gence. Being a leading edge ICT produceris not any more a guarantee of future suc-cess. That is a major challenge to Finland,since the country has lagged somewhatbehind the frontier of the most sophisti-cated users of ICT and benefited from ICTrevolution mainly as an advanced produ-cer. It is evident that the productivity gainsfrom ICT will diminish substantiallyunless the usage of these technologies isintensified. Production advantages aremoving off-shore, more efficient use ofICT has to take the key role in fosteringand upgrading knowledge economy.

There are, however, several new routesopening in ICT applications. The sectorspecific effects of ICT use will gain moreimportance. Especially, in services sectorthe opportunities for productivity increas-ing solutions and applications are nume-rous. Another thing is the convergence ofseveral historically distinct technologies,like ICT, bio and nanotechnologies. Thenext industrial revolution might well bebased on combination of Nano-, Bio-,Information, and Cognitive technologies.Maybe the next wave of fast industrialdevelopment is called NBIC revolution, ashas been envisioned. In that wave Finlandwill be well positioned due to strong ICTsector, and rapid advances in the otherthree. ❙


or instance, only six years after the patent of Bellmajor cities in Finland had telephone companies.

In the beginning of the 1920’s Finland had alreadyboth a national airline and a broadcasting companyin operation. Later, Finland became a forerunner inthe mobile phone and Internet use, as well as ininternational comparisons based on science andtechnology indicators.

The modern research and development (R&D)policy in Finland starts from the beginning of the1980’s. It became clear that Finland would never beable to compete successfully with a resource-inten-sive industry, whereas knowledge intensity andtechnology offered the platform on which to buildthe future. The solid shape of the competitiveness ofFinland today is based on the common understand-ing of the importance of technology, research, anddevelopment. This national consensus was largelybuilt already more than twenty years ago during the1980’s, both Tekes, the National Technology Agencyand the Science and Technology Policy Councilwere founded.

The performance of the Finnish economy in the1990s was remarkable after a severe economic crisisin the beginning of the 1990’s. The keywords “infor-mation society” and “knowledge-based economy”were adopted in the Finnish policies.

Today, Finland is close to the top on many inter-esting ranking lists: competitiveness, environmentalsustainability, technology, industry-science rela-tions, R&D expenditures, reading literacy andmathematics readiness among the youth, engineer-ing, and natural sciences...

| overview|

Finland's Technology Policy Yields Fruit

Since centuries, Finns have been

known to be fast appliers of new

technologies. A nation struggling

with severe climate conditions

simply had no other possibilities

than to apply new technologies as

fast as possible.

Science and Technology Policy Council Formulates the StrategiesThe Science and Technology Policy Council ofFinland, chaired by the Prime Minister, advices thegovernment and its ministries in questions relatingto science and technology. The Council is responsi-ble for the strategic development and coordinationof Finnish science and technology policy as well asof the national innovation system as a whole.

Currently as many as seven other Ministers andten other members well versed in science and tech-nology participate in the work. The Science andTechnology Policy Council has contributed a lot inthe national technology strategy and has beeninstrumental in forming the national consensus anda solid commitment concerning the actions to becarried out in the field of national technology policy.

Tekes – an Internationally Renown Best Practice EntityTekes, the National Technology Agency is the mainpublic financing and expert organization forresearch and technological development in Finland.Tekes finances industrial R&D projects as well as

“Risk taking andrisk sharing is anabsolute necessity,since experienceshows thatavoiding risks isthe best way toavoid success stories as well!”,says AnttiJoensuu.

Antti Joensuu, Deputy Director | General Technology Department Ministry of Trade and Industry

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Today’s Challenge Is GlobalizationThe nationality of a product or company plays a diminishingrole in the modern world. Globalization is a process in whichelements needed for a process or product can be selected andcombined globally. This development has already relocated asignificant amount of the manufacturing industry in theworld. Currently, the question is about the division of labourbetween the nations. The only viable strategy is to accept thephenomenon and to try to make use of the best parts of it.

The role of Finland in the global distribution of tasks isevident. We cannot compete with low salaries but we can doso in the creativity and innovation. We offer one of the bestinnovation environments for companies coming from allover the world. A small country can, thus, really benefit fromthe current globalization. Small home markets forces firms tospecialize and seek foreign markets already at an early stage.Moreover, the small size of Finland is also an advantage forcreation and efficient diffusion of new knowledge in, forinstance, ICT.

An efficient networking is crucial in the innovationprocess. From this point of view Finland is an excellent envi-ronment, since the Finnish economy is known as open, spe-cialized, and extremely networked. Some foreigners even saythat Finland is not a country but merely a club! A networkedsociety is a real asset, since innovation is an extremely comp-licated phenomenon needing good social capital in order torealize. It cannot easily be described as a chain (as was thenormal description years ago) – rather a plate of spaghetti –complicated and difficult to manage!

An example of a proactive approach vis-à-vis the global-ization is the launching of a Finnish-Chinese InnovationCentre in Shanghai this year. This innovation centre, which iscalled FinChi, will not only help the Finnish companies tofind business and technology partners in China but also pavethe way for the Chinese investments towards Finland. Thepragmatic approach is to amplify the favourable effects of theinevitable globalization instead of trying to restrict the phe-nomenon.

New themes constantly pop up and the national innova-tion policy can never sleep. Investing 3,5 per cent of our GDPin research and development (3rd highest figure in theworld) is good – yet not good enough alone. We have toremember that the scoreboards of 2020 are built today. ❙

www.ktm.fi/english

projects in universities and research institutes. Tekes especial-ly promotes innovative, risk-intensive projects. Risk takingand risk sharing is an absolute necessity, since experienceshows that avoiding risks is the best way to avoid success sto-ries as well!

The primary objective of Tekes is to promote the competi-tiveness of Finnish industry and the service sector by assist-ing in the creation of world-class technology. Tekes’ fundscome from the state budget via the Ministry of Trade andIndustry. Tekes has a budget of more than 400 million euros,a solid source of funding for 2,000 projects annually.

The Ministry of Trade and Industry is responsible forFinland’s technology policy. On an operational level Tekespromotes and coordinates R&D projects and programmes, inaddition to maintaining cooperation within internationalnetworks. Tekes works in collaboration with several partnerswithin the Finnish innovation environment, including theAcademy of Finland, the main basic research funding organi-sation in Finland, and Finpro, which provides services, sup-port and information to help Finnish companies enter theinternational market.

Science Parks Combine Regional and International ActivitiesThe science parks (or technology centres) working in thevicinity of universities promote the creation of new businessin the regions. They foster the founding, growth, and inter-nationalization of innovative hi-tech companies and act asactive middlemen in collaboration with universities, compa-nies, and local authorities. The 22 members of the FinnishScience Park Association TEKEL accommodate 1,600 enter-prises and other organizations – bringing together 32,000experts working in different fields of technology such as ICT,health care, biotechnology, environmental and food technol-ogy, materials research, and digital media. On top of these,several thousands of enterprises operating outside thepremises of the science parks also work in close cooperationwith the local science park influence.

The science parks execute the regional Centre of Expertiseprogrammes. They bring together companies, universities,polytechnics, public bodies, investors, etc. as well as providersof business development services in joint R&D projects with-in different fields. The science parks also actively identifyresearch break-throughs for commercialization and partici-pate in the work of the EU Innovation Relay Centre Networkfor technology transfer.


he OECD (Organisation for Economic Co-opera-tion and Development) brings together the 30

industrialized countries for policy analysis and peerreview. Some of the most frequently referred topublications are benchmarking statistics and coun-try rankings. Luckily for all parties concerned, thoseof the OECD generally agree with the key findingsof broad competitiveness surveys even though theOECD bases its analysis hard statistical facts mostlyon official sources. This article casts a view inFinnish ICT development in the light of two reportspublished in December 2004.

The OECD Science, Technology, and IndustryOutlook 2004 offers a comprehensive picture ofmicro-economic performance of countries. Finlandgenerally ranks high in areas such as share of R&Dspending and employing scientists in enterprises, asdemonstrated by the following two graphs.

The report also identifies a number of challengesfor Finnish policy. Service sector productivity andinnovation need more focus, although the picture isuneven. Competitive services sectors, such as busi-ness and telecom services, are high-performingwhereas personal and public services demonstrateroom for improvement. Again, there is a need formore detail; Finland was placed at the top in therecent PISA 2003 study that ranked learning skillsof 15 year olds across the OECD countries. Otherpublic services, such as health of government, aremore difficult to measure but show generally a slowchange despite investment in technology.

The IT Outlook 2004 looks closer into the ICTclusters and policies in the OECD countries.Traditionally Finland has ranked high in penetra-tion of new technologies such as mobile phones orthe Internet. Broadband penetration in the house-hold sector will remain a challenge in sparsely pop-ulated country like Finland if compared to somefront-runners, in particular in the Asian countries.But commercial use of ICT in Finland is welladvanced as companies seek ways to improve pro-ductivity through technology.

Despite this wide across-the-economy investmentin ICT, there is still room for development in theservices sectors as, like in most countries, the ICTcluster itself has played an important role in eco-

Finnish ICT Development from the OECD Perspective

Figure 1. R&D intensity in OECD countries, 2002GERD (Gross Domestic Expenditure on R&D) as a percentage of GDP.

Figure 2. Business researchers per thousand employees in OECD countries,1995 and 2002.

Figure 3. Businesses using the Internet for purchases and sales, 2001 or latest available year. Percentage of businesses with ten or more employees.

| global view|

Pekka Lindroos, Head of Information | Computer & Communications Policy Division OECD Directorate for Science, Technology and Industry

Japa

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Business researchers,a s a percentage of totalresearchers, 2002 or nearest year available

20021995

2002

1995

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13

Figure 4. Business R&D expenditure in selected ICT industries, 2001 orlatest available year as a percentage of business enterprise sector R&Dexpenditure

Figure 5. The contribution of ICT manufacturing to aggregate labour productivity growthContribution to annual average labour productivity growth, percentage points

nomic development in Finland. It has acceleratedR&D investment, growth, and productivity develop-ment.

In the OECD peer reviews are used to shed lightinto how policy leads to performance. A recentseries of reports looked into how government poli-cies promote ICT diffusion to business. The reporton Finland (OECD/DSTI 2004) highlighted the factthat market forces have been given predominanceand that the government limits its interventions.One of the main challenges ahead is how to engagean increasing number of companies as users of ICTinto the technology projects, and how to have morevisible demonstration of impacts of technology andtechnology programmes.

Again, like in all countries, applying ICT in allcompany functions to form one single system hasstill a long way to go. Companies in Finland acquireproduction inputs over the value chain in digitallymanaged systems as a common practice engagingalso numerous small and medium sized companies.However, integrating the different systems takestime.

The report also notes that even though thetelecommunication markets have been deregulatedin Finland quite some time ago, the authorities needto keep a keen eye on network access conditions forcompeting service providers, in particular in broad-band markets.

The report concluded that the future success ofthe Finnish economy and the ICT cluster willdepend on the ability to turn new technology inno-vations into practical applications that companiesand people will be willing to invest in. Competitionand squeezed margins may make companies to viewbold business ventures and provision of new tech-nology applications with a critical eye. But, like inthe past, competition and innovation go intimatelyhand-in-hand. Entrepreneuring innovators willcontinue to enjoy of the acceptance of a technologyprivy market such as Finland. ❙

www.oecd.org/sti

“One of the main challenges ahead is how toengage an increasing number of companies asusers of ICT into the technology projects, and howto have more visible demonstration of impacts oftechnology and technology programmes.”

Ireland

Finland

Korea

Canada

Sweden

Netherlands (4)

Norway (5)

United States (4,8)

Denmark

Italy

Belgium

United Kingdom (4,6)

Spain

Poland

Czech republic

Australia (4)

Japan

France (4)

Germany (3)

61.4

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48.4

40.8

37.8

37.1

35.8

27.5

26.0

24.4

24.4

23.1

Countries without Division 64

ICT-related R&D expenditure in manufacturing industries (1)ICT-related R&D expenditure in services industries (2)

13.2

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34.3

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20.2

0 10 20 30 40 50 60 70%

1.00

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a


These are the kinds of questions asked by many people from all overtrying to help their own countries. Is it really true? Can we too changeour lives overnight for the better? The correct answer is that that thereis no one answer except that it can be done, but not overnight!

It has taken the Finns a lot of effort during the last more than 150years.

In the middle of the 19th century a Finnish statesman and authorstated that a small country can only survive successfully through itsculture. (The same is, by the way, true today in our world of globaliza-tion.) Thus, in the words and deeds of Johan Vilhelm Snellman startedthe Finnish magic. Although, in order to tell “the full truth”, hedespised engineers and knew of course nothing about ICT or anythingelse related to modern technology that has done so much good for ournation.

Snellman wanted everybody to learn to read and write. Hiscontemporary, Mr. Cygnaeus started the “obligatory primary school”.As a matter of fact, it was the church that contributed the mostimportant part deciding that men would not be allowed to marryunless they were literate! This was a good start and soon in the late19th century Finland was already a world leader in the number ofnewspaper copies per capita.

Ever since we have done a good job in defending our culture. Sinceour independence in 1917 we have never been occupied, quite anachievement in the turbulent Europe! We have also a remarkablehistory of PPP – Public Private Partnership – creating a history ofeconomic growth second to none in spite of lost wars and the fact thata few beautiful trees enjoying pure air and water have not yet been ableto prove to the rest of the world that this is or it will be the futureparadise. Global warming is going to be an interesting test!

So far our cold infamous climate has saved us from too manyimmigrants, but in the years to come we hope to get more, for all kindsof work, equally scientists and street sweepers. We have a strongculture, we are not afraid of any democratic peaceful globalization. Wewant to continue to build for the future, for a real information society,information for all. (My personal idealistic goal is literacy for womenin the least developed countries, in particular in Africa).

One of the latest Finnish contributions to mankind has been theMillennium Technology Prize. Again a Public Private Partnershipinitiative honouring once every two years a global technologicalinnovation for human development with one million euros. Last yearthe prize was given to Dr. Tim Berners-Lee for his wonderful world-wide-web. Next year we are looking forward to another humantechnological innovation and a Finnish contribution to global humanwell-being. ❙

Why the Finns Again?

| column|

Dr. Pekka Tarjanne, Chairman of the International Award Selection Committee

Some years ago Swedish newspapers liked to useheadlines like “A Finn Again”.

We Finns have also had for a long time a strong love-hate relationship with our dear neighbours, theSwedes. As a part of this phenomenon the Swedeswanted to prove that most crimes in Sweden werecommitted by Finnish immigrants or tourists.

Today we are more used to other kinds of headlines:

“Finland, the world’s number one in competitivity”

“Finland, the least corrupt country globally”

“Finland tops many statistics describing efficiency in ICT and its applications”

“Finnish students rank highest in the world”

“Finland among the best when you measure Quality of Life”

Why have things changed?

Why has this poor country with very

limited natural resources become

a leader in so many fields?

Where can we find the Finnish secret?

Can it be used or even copied

in other parts of the world?


| international cooperation|

he two-phased World Summit on theInformation Society (Geneva 2003–Tunis

2005) successfully promoted the globalunderstanding of the possibilities of build-ing information societies all over theworld. Many countries are now activelydeveloping their information society poli-cies and concomitant tools like e-strate-gies. Countries donating development aidare mainstreaming ICTs in their develop-ment policies.

Finland has actively been taking part inthis long, still ongoing process, and hasreached the goals set for the negotiations.The Finnish information society is inter-nationally greatly appreciated and, thus, itis expected that Finland shares the know-ledge she has about building informationsocieties with other countries.

Finland’s Prominent PresenceThe Finnish 50-person delegation takingpart in the first phase of the Summit ofGeneva 2003 was headed by PresidentTarja Halonen. In the side-event “ICT4D”Finland was well presented, as was Nokia.

The first phase in Geneva was able toadopt a common global strategy on abroad range of difficult issues connectedto building information societies, such ashuman rights, freedom of speech, and ethical questions. Furthermore, agreementwas achieved on the need to create anenabling environment with supportive andpredictable policy and a regulatory frame-work, which encourages human participa-tion and innovation.

Finland was deeply engaged in thesenegotiations and our main ideas were wellreceived, at first within the EuropeanUnion and thereafter by other UN coun-tries.

International negotiations like these areoften tedious work for the participants.Information society policies have now

Finland and WSIS

President of the Republic, Tarja Halonen and DirectorGeneral at the Finnish Ministry for Foreign Affairs, Yrjö Länsipuro attending the Summit on theInformation Society in Geneva 2003.

been on the UN agenda for three years,and it is interesting to note that we havemoved from the suspicions harboured atthe early stage to a far reaching consensuson how to best benefit from the informa-tion and communication technologies toboost the development and well-being ofall people.

Wide Acceptance Based on ConcreteResultsThe principles adopted in Geneva are nowwidely accepted as a basis for implemen-ting future work. This acceptance is alsostrongly based on the concrete resultsachieved in many countries that have taken action along the WSIS-principles.Also, most of the suspicions entertained bymany are now beginning to be dispelledand are gradually disappearing as the posi-tive impact of ICTs in many areas of soci-ety is becoming better visible.

This Summit is unique as it is held intwo phases within two years. This meansthat we now have the opportunity to moveforward together towards the targets wehave set ourselves. In Tunis, we aim tomove from principled theory to action.Now is the time to agree on the imple-mentation on the Geneva principles in

Africa, Asia, and Latin America as well asin other continents together with govern-ments, the civil society, and the privatesector. Also, an argreement on the out-standing issues from Geneva, ie. Internetgovernance and financial mechanisms, willbe important in Tunis.

Just like Geneva, Tunis will not only be apolitical summit but also a meeting placeof utmost importance for all informationsociety activists from all over the world. Atthe side-event “ICT4D”, Finland will bepresenting her experiences in buildinginformation societies and best practicesand solutions which might be of interest toothers, especially developing countries.

WSIS, while recommending representa-tion from governments at the highest levelalso invites participation of all relevant UNbodies and other international organiza-tions, non-governmental organizations,private sector, civil society, and media toestablish a truly multi-stakeholder process. ❙

www.itu.int/wsis/

Timo Heino, Counsellor Ministry for Foreign Affairs

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17

CT for Development has been the focusof action in international organizations

and international fora during the last couple of years. As the information societyor information economy is the currentphase in many of the late industrial soci-eties, the question is what will happen inthe developing and newly industrializedeconomies. Will they follow the develop-ment of industrialized world or will theytake a development path of their own inthe use of ICT?

Economic and Social Wealth Through ICT International development organizations,like the World Bank, Regional Develop-ment Banks, the EU, the UN, and the G8have for some years focused on informa-tion society as a phase of future develop-ment of countries in Asia, Africa, andLatin America. The developing and newlyindustrialized economies can learn fromthe experience of industrialized countries.These countries can leapfrog the techno-logical development and benefit from ear-lier experiences and use the best practices.Due to the latest technology, these coun-tries can take a new position in the inter-national economy through globalisation ofinformation and financial flows. At thesame time the economic growth in manydeveloping countries allows for wider useof ICT services.

ICT as a Part of Development StrategySome developing countries have alreadyproduced and implemented their ICT forDevelopment Strategy. ICT4D strategy is anational policy that focuses on ICT as ameans to reach development goals of anation. To implement the strategy anaction plan with some general conditionsis needed.

Telecommunications infrastructureneeds to be sufficiently developed, the regulatory framework should allow for

competitive services at a reasonable rate,and citizens should have access to infor-mation and communications services.

Finland has recently included ICT in itsdevelopment aid program and is about toformalise its ICT for DevelopmentStrategy in this program. What could other countries learn from Finland indesigning and implementing of theirinformation society or ICT strategy?

The Finnish ExperienceFinland was suffering from deep economiccrisis in the early 1990’s. At that time somecritical decisions were made by the publicand private sector. The governmentincluded information society in its pro-gram as one of the key future growthareas, public investment in R & D wasincreased, as well as allocation of publicresources in technology education andtraining. This coincided with Nokia trans-forming into an ICT industry companyfrom a traditional pulp and paper, tire andcable industry company.

Competitive Environment and HumanResources The telecommunications and ICT regula-tory liberalisation started in the late 1980’sand early 1990’s with data communica-tions, local and long-distance telephonyliberalisation and later privatisation. Thiscreated a competitive environment intelecommunications as one of theEuropean forerunners. Finland had histo-rically non-monopolistic telecommunica-tions markets in local fixed-line telephonysince the beginning of telephony. Finlandbecame one of the leading informationsocieties in the world in a little more thana decade in terms of the ICT share of GNPgrowth and share of exports. This develop-ment required enabling regulatory environment and human resources(trained labour), and public and privateinvestments in R & D. According to

ICT for Development Can Other Countries Learn from the Finnish Experience?

Michael E. Porter, two additional elementsto successful strategy are necessary: timingand luck. This was the case in Finland.

Finland had collaborated with otherNordic countries in developing GSM (ear-lier NMT) standard and it supportedGSM to become one of the global stan-dards in mobile wireless telephony.

The Finnish Know-How The Finnish information society has pro-duced innovations and best practices inICT. We have expertise in open source soft-ware, e-learning, e-business and in digitalpublic sector services, and high use of ICT.We also piloted early on telecenters asaccess points to citizens to informationservices. It would be useful to integrate thisknowledge and experience in the tradition-al development areas like education, ruraldevelopment, equality, and environment.The ICT for Development will providenew challenges and opportunities forFinnish information society know how. Wecannot export our experience as it is, but itmay provide a useful case for countriesintegrating ICT in their development. ❙

“The ICT forDevelopment will

provide new challengesand opportunities for

Finnish informationsociety know how.”

Helena Tapper Senior Adviser, TIEKE

TIEKE Finnish Information SocietyDevelopment Centre has a key networkingrole as a neutral and non-profit organisationin promoting the information society.www.tieke.fi

Helena Tapper, Senior Adviser | TIEKE Finnish Information Society Development Centre

I


he recent Wim Kok report states: “The Lisbonstrategy is even more urgent today as the growth

gap with North America and Asia has widened,while Europe must meet the combined challengesof low population growth and ageing”.

Together with ORGALIME and EICTA, theEuropean cooperation organisations of the engi-neering and ICT industries, the TechnologyIndustries of Finland welcomes the renewed priori-ty given to the Lisbon process and actions support-ing European entrepreneurship and innovation. Wehave to consider the success factors and main obsta-cles for entrepreneurs, especially for the innovativeand growing SMEs, the most vital resource of theEuropean society.

R&D Activity Absolutely Necessary in the Engineering and ICT Industries The European industry must increase its producti-vity and renew its products. The citizens of theUnion must be encouraged to innovate and takerisks in starting globally competitive new ventures.All Member States of the EU ought to achieve thetarget of 3% of GDP devoted to R&D.

It is necessary to support research in selectedareas in order to update the know-how on globalleading edge technologies. It is important toimprove the access of SMEs to research results and

underpin them in their shorter term product deve-lopment. International studies recognize the SMEsas the most reliable providers of new employmentand steadily improving regional well-being.

The industrial competitiveness and innovationabilities can be ensured by industry-drivenEuropean research. Therefore, considerable invest-ment in R&D of manufacturing technologies has tobe included in future European programmes tokeep the manufacturing industry in Europe.Relevant development themes of the manufacturingenabling technologies are e.g. ability to process newmaterials and complex products, reliability, sustai-nability, and miniaturisation.

Moreover, companies will only invest in innova-tion and R&D if there is appropriate protection ofthe intellectual property rights. The pending pro-posal on the patenting of computer-implementedinventions should urgently be adopted.

Deregulation Instead of Overwhelming EU Regulation The EU directives were initially meant to facilitatefree movement of goods and services on the inter-nal market. Today, the massive regulative activity isout of control. In too many cases, the directives andsubsequent legislation are excessively complex andthey unnecessarily burden the European companiesin comparison to companies outside the EU.

Europe needs to be competitive in attractingdomestic and foreign risk capital. Access to risk capital, innovative environments, encouragementand reward for entrepreneurial activities will allhelp start-up companies. Governments should alsoremove obstacles for industry to invest in ICT. Newand potentially disruptive technologies create thepotential of new businesses and innovation thatmust not be stifled by restrictions.

Experience from Finland Finland has the experience of a success story of theelectrotechnical and ICT industries in the 1990s.The national infrastructure of R&D was tuned tooptimal efficiency in cooperation with the compa-nies. The most recent vision paper published by theFinnish Electrical and Electronics Industry SET

Know-How The Best Resource in Global Competition

Five years have passed since European leaders committed

themselves to the Lisbon strategy with the goal of making

the EU the most dynamic and competitive knowledge-

based economy in the world.

However, the competitiveness of the EU has dwindled.

Investments in manufacturing industries have been

moving outside the EU with an accelerating speed and the

product development is next in line. The worst scenarios

suggest an irreversible economic decline for Europe.

| international cooperation|

Leo Laaksonen, Adviser | Technology Industries of Finland

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19

(now the Technology Industries of Finland) indi-cates in its road maps positive scenarios for furtherinnovation in several segments of applications.

A key strategic factor is specialisation – sharpfocus in companies’ core technologies and nicheapplications – keeping in mind the demand of fasttime-to-market and time-to-profit. Networks of dif-ferent sectors of industry and services will formgood platforms for system level innovations andmulti-technology combinations.

The Unquestionable Benefits of ICT Use The ICT industries are the key to the competitive-ness of the entire EU. The ICT industry is typicallyan integrator of several areas of technologies. It isan enabler and supplier of added value to all otherindustrial sectors as well as the public sector.

ICT helps companies to increase productivityand create attractive products to be sold on theworld market. It improves the quality and decreaseslead-times and costs. ICT technologies also fuel sus-tainable development by reducing the environmen-tal impact of business activities. ICT has wide appli-cation in public services: in administration, in theeducational system, in the health care sector, and intransportation.

Promotion of Broadband and Its ApplicationsEurope’s economic success depends on the take-upof world class ICT based technology. Advancedbroadband will be the infrastructure of the knowl-edge economy in the 21st century. The Europeangovernments have not yet sufficient political visionand leadership to drive broadband take-up.European Council is urged to establish a soundpolitical objective of “broadband for all” by 2010.

The European public sector should accelerate itsinvestment and use of broadband ICT to improveits efficiency and the quality of services to citizensand businesses. Member States should take immedi-ate action in eGovernment, eHealth, eLearning, andeTransport.

Having sufficient IT-user skills will be one of thekey competencies in the society. Curricula mustintegrate IT skills at an early age. Higher levels ofskills are also needed to increase the use of ICT inindustry and commerce.

The security in the community is on top of thepolitical list. The development based on ICT tech-nologies is, hence, fundamental for the overall secu-rity of citizens. Problems in security already imposean enormous cost on industry and undermine consumer confidence in new services. ❙

Leo Laaksonen serves as Adviserat Technology Industries ofFinland, organization with amandate to help its membercompanies maintain theircompetitiveness in internationalmarkets.www.teknologiateollisuus.fi/english

The digital content and

services ought to be

easily accessible to

European consumers

as well as professional

users. Maximum

interoperability of IT

systems, applications,

and networks is one of

the most important

requirements of the

future information

society. Three key

factors should be

addressed and

managed carefully:

❚ Data protection to obtainconsumers confidence anda trust

❚ Digital Rights Managementsystem, for appropriaterevenue to all players

❚ Efficient and reliablepayment mechanisms

Potential Multisectoral Clusters

APPLICATIONS ON THE MARKET

INTEGRATION of KNOW HOW and TECHNOLOGIES

TECHNOLOGICAL COMPETENCES

-> New plastics & bio-materials + MEMS + embedded software Leo Laaksonen 5/2004

Supply Chain & Logistics + RFID + EDI

Public services + Internet + Security

Industrial Automation + Ambient Intelligence

Well-being, elderly, healthcare, + ICT

Environment, Recycling + ICTEntertainment, leisure, sports, tourism

Energy Distribution and Efficiency + ICT

Real Estate Services + ICT


| communications|

Leena LuhtanenMinister of Transport and CommunicationsVice-Chairperson of the National Information Society Council

“The Government supportsinnovation networks withinvestments toinfrastructure, education,research and development– and with liberal marketregulation and leanbureaucracy.”

2121

he global market offers border-less business opportunities. But

the same opportunities are opento everyone else as well. The keyfactor to success is productivity –how to produce more added val-ue with the available resources.One of the best ways to do this isto use new technologies and tobuild dynamic networks withpartners and customers. InFinland the forerunners can befound from the ICT, banking,paper, and metal industries.

The Government supportsinnovation networks with invest-ments to infrastructure, educa-tion, research and development –and with liberal market regula-tion and lean bureaucracy. Aforum for these activities is theGovernment Information SocietyProgramme – with ambitiousgoals to improve competitivenessand productivity, to promotesocial and regional equality, andto improve citizens’ well-beingand quality of life through effi-cient use of information andcommunications technologies.The Programme is chaired by thePrime Minister and involves keystakeholders through theInformation Society Council.

Two cornerstones of the programme are the BroadbandStrategy and the InformationSecurity Strategy.

The Broadband Strategy poolskey actors together to makesure that by the end of 2005:

❚ All technologies included,there are 1,000,000 broadbandsubscriptions in Finland, ofwhich the most have aconnection speed of at least 2 Mbit/s (in a population of 5.1million inhabitants)

❚ High-speedtelecommunicationsconnections with regionalcoverage and reasonable end-user prices are available toeveryone; and

❚ Finland’s status as one of theEuropean leaders in the use andavailability oftelecommunicationsconnections is stabilized.

The strategy contains nearly 60concrete actions that will makethese objectives real. Theserange from legislative measuresincreasing competition toresearch and developmentactions creating new services.

The Information SecurityStrategy is the Government’smain tool to build trust towardsthe information society. Themain objectives of the strategyare to:

❚ Promote national andinternational cooperation in thefield of information security;

❚ Increase nationalcompetitiveness and build afavourable businessenvironment for ICT firms;

❚ Improve information securityrisk management;

❚ Safeguard the citizens’fundamental rights and helpcompanies to protect theirknowledge capital; and

❚ Increase awareness of andcompetences in informationsecurity.

The strategy contains about 30measures and brings resourcesof the Government, businesssector, and other organisationstogether. The strategyunderlines the importance ofinformation security and trustin the development of newproducts and services and intheir adoption by thecustomers. It also points outthat information security is notonly a technical issues but moreand more an economic, social,and political challenge.

Broadband Connections and Information SecurityLeena Luhtanen, Minister of Transport and Communications | Ministry of Transport and Communications

Broadband connections andinformation security are crucialelements of the information society. However, there are othercrucial elements as well. Efficientuse of new technologies requiresnew skills, new working methods,and new ways to organize theentire company or administra-tion. The Information SocietyProgramme emphasizes stronglyeducation, training, and organi-zational development both inprivate and public sectors.Competition is pushing compa-nies to innovate and change, yetthe need for radical reforms con-cerns the public sector as well.Cost effective, service oriented,and cooperative administration isa strong factor when trying toattract work and investments.And this is exactly what we aredoing within the InformationSociety Programme as well:structural and operationalchanges at the central and locallevels that will let us utilize fullythe opportunities of the ICT. ❙

www.mintc.fi/english

T


|communications|

The National Information Security Day in Finland

Enforcing the Security of Information

The National information security day in Finland is acommon project of the business life, public administra-

tions and various organisations. The Information securityday aims at increasing the Finns’ awareness of the risks of theInternet and provides information and advice on how toprotect oneself against information security threats.

The first National information security day was held inFinland on 11 February 2004. The objective of the day was toensure that operating system updates, up-to-date anti-virussoftware and a firewall are incorporated into all Internet-connected computers. The day was a success: according tostudies commissioned by Taloustutkimus, a market researchfirm, and Statistics Finland, a significantly increasing numberof home computers, in comparison to last fall, had bothantivirus software and a firewall.

Primary Target Group in 2005 Pupils, Teachers, and ParentsThe Information security day of 2005 was held on 8February 2005. The day was targeted at schoolchildren, theirteachers and parents. The aim was that the day would engageschools in a yearlong work project regarding informationsecurity. This would involve that emphasis is put on the safeuse of the Internet and that students take the valuable infor-mation to homes as well.

To support the information security education given atschools, an online service, www.tietoturvakoulu.fi (informa-tion security school), was opened on the Internet. The threekey messages of the website are: Protect your computer,Safeguard yourself and Follow the rules. The service encom-passes sections for teachers, younger and older schoolchild-ren and parents. In the pupils’ section, animated storiesdesigned for different age groups include information securi-ty knowledge, suggest themes for further discussions, andprovide a lot of exercises.

The National information security day is the primary pro-ject of the governmental Information Security Committee. ❙

Sari Salmela, Project Coordinator and Jani Arnell, Information Security Adviser | Finnish Communications Regulatory Authority

The National information security day

is a joint project of the business life,

public administration, and various

organisations. The Information

security day aims at increasing the

Finns’ awareness of the risks of the

Internet and provides information and

advice on how to protect oneself

against information security threats.

Further informationwww.tietoturvaopas.fi (in Finnish)www.tietoturvakoulu.fi (in Finnish and in Swedish)

23

Together towards an Information-Secure Society

in Finland

The Information security day 2005 was arranged by:

Elisa Corporation

Finnet Association

F-Secure Corporation

Hewlett-Packard Oy

Helsinki Televisio Oy

Ministry of Transport andCommunications

The Mannerheim Leaguefor Child Welfare

Microsoft Oy

Nokia Oyj

Nordea Bank Finland Plc.

National Board ofEducation

Ministry of Education

Save the Children Finland

Song Networks Oy

Association of FinnishLocal and RegionalAuthorities

TeliaSonera Finland Oyj

TIEKE Finnish InformationSociety DevelopmentCentre

Finnish Federation forTelecommunications andTeleinformatics FiCom ry

Office of the DataProtection Ombudsman

Finnish InformationSecurity Association

Information SocietyProgramme Finland

Finnish CommunicationsRegulatory Authority

The Finnish Communications RegulatoryAuthority (FICORA) is a Finnish information

security authority whose responsibility is to enforceinformation security policies in telecommunicationscompanies, protect privacy in electroniccommunications, and prevent and resolveinformation security breaches. Belonging toFICORA’s information security unit, the CERT-FIteam is Finland’s national CERT actor. Its customerscomprise all essential Finnish companies and otherorganisations as well as private persons.

Information security breaches and attempts tocause them are continuously increasing. In orderthat Internet users could avoid these risks, they mustbe aware of the threats of the net world. FICORA’sCERT-FI team participates in a project under theNational Information Security Strategy, whose aimis to create an up-to-date and functional overview ofinformation security that serves all target groups.This situation report is updated by FICORA and allkey actors have access to it.

FICORA’s CERT-FI delivers information oninformation security by issuing alerts and guidelinese.g. at www.cert.fi, via e-mail lists, and on theteletext of the Finnish Broadcasting Company.CERT-FI publishes quarterly and annual reports,which can be found on the website www.ficora.fi (inFinnish). The situation report examines factors,which have influenced the information securitysituation over the past quarter. These are malicioussoftware and their effects in Finland, phenomenarelated to spam, the amount of problematic

information systems, as well as the development ofdata system break-ins and vulnerabilities. The reportalso analyses the information security outlook of thefollowing quarter. The situation report aims tosupport companies and organisations as well asprivate actors in their attempt to increase themanagement of information security risks.

In early 2005, CERT-FI published an annualreview according to which information securityproblems in Finland during 2004 were caused bye.g. various malicious software epidemics, worms inparticular and malicious software called BOT, whichcaused significant problems for several Finnishcompanies and and organisations. Professionalpursuit of economic benefit, in particular,contributed to the development of malicioussoftware. The information security of mobiledevices was affected by e.g. the first malicioussoftware that hit mobile phones running theSymbian operating system, as well as programsexploiting program vulnerabilities in Bluetoothconnections.

A country of high technology, Finland considersit important that the level of information security ishigh. In broad cooperation with various actors inthe sector, FICORA aims to promote informationsecurity and privacy protection in communicationsnetworks and services. ❙

Contact details for the CERT-FI team: [email protected]

The functions of FICORA’s CERT-FI team (Computer Emergency Response

Team) include dealing with information security threats and incidents in

cooperation with both trade and industry as well as various authorities.

Also, the CERT-FI team creates an up-to-date and functional overview of

information security that serves all target groups.

The aim of the National

Information Security Strategy

is to create an up-to-date and

functional overview of

information security that

serves all target groups.


The ICT sector continues to face aperiod of transition and changes.

Competition in the communications andinformation technology sector is gettingtougher, and there have also been signs ofrestructuring. In the mobile phone andbroadband sector there are even signs ofoverheating, and the prices of terminalequipment and services have fallen.

Competition has also been promoted bymeans of legislation. One of thesurprisingly popular phenomena duringthe last year was the portability of mobilephone numbers, which means thatcustomers are able to keep their oldnumbers even if they switch operators.There are about 4.5 million subscriptionsin the Finnish mobile phone market, andabout 1.5 million of them have beenswitched to another operator. There areeven consumers who have transferred theirnumbers several times in search of evenbetter offers.

The legislation and above all its inter-pretation have become stricter. Finland hasintroduced EU-level regulations early andin a very extensive manner.

Although Finland has been in the van-guard of many new innovations, thirdgeneration mobile communication ser-vices were introduced here somewhat laterthan in many other countries. This is dueto, e.g. the lack of terminal equipment thatwould meet consumer requirements andthe fact that it has been possible to imple-ment services of the 3G network withmore advanced technologies that arealready in use, although this has been aslower and more complicated alternative.Wireless local-area networks (WLAN) arealso spreading to offices and homes.

Larger companies and public adminis-tration are rapidly starting to exploit theopportunities offered by VoIP (Voice overInternet Protocol) as an efficient means ofimplementing voice communications.

Rapid Changes One of the major trends lately has beenthe extremely rapid increase in the num-ber of broadband connections. As the esti-mated number of broadband connectionswas 470,000 in December 2003, there werealready 750,000 connections in December2004. This means that every third house-hold in Finland has one.

Ever Tougher Competition on All Fronts Reijo Svento, Managing Director | Finnish Federation for Communications and Teleinformatics, FiCom

“It is true that Finland is not

number one in the world in all

respects but, as a whole, Finland

can still be said to be one of the

top countries in the world.”

Reijo Svento, Managing Director, FiCom

In early 2004, the Government ofFinland adopted a National BroadbandStrategy. It is now evident that we willreach its target, one million connectionsby the end of 2005. Finland has been ableto increase access to broadband subscrip-tions considerably. Today more than 95per cent of the population has access to aconnection.

The emphasis of the BroadbandStrategy has been transferred from quanti-tative to qualitative targets. The aim is toincrease the speed of most connections toat least 2 Mbit/s by the end of 2005. By theend of 2007, the most common subscrip-tion type should be 8 Mbit/s. Before thesetargets can be reached, both the commer-cial and the public sector must developservices and contents that consumersregard as useful.

The sales of digital set-top boxes andintegrated digital televisions also increasedrapidly in 2004. At the beginning of 2005,every fourth household in Finland hasaccess to digital television transmissions.

Smaller and More Efficient EquipmentThe so-called Moore’s Law still holds truefor the development of information andcommunications equipment: the power ofthe equipment increases as its size dimi-nishes. Small lap-top computers now haveas much memory and other features as themost advanced desk-top computers someyears ago. Today’s mobile phones are smallwonders with their cameras, e-mail, calen-dar and memo functions, MP3 players,and several other features.

The size of the files to be transferred hasincreased incredibly. This is mainly due tothe fact that more and more video andaudio is transferred through the Internet.The volume of the Internet traffic betweenFinland and other countries has increasedthreefold in just one year: it has increasedfrom two gigabits per second to six giga-

| telecommunications|

25

bits. This is the highest growth figure inthe whole of Europe. If this trend contin-ues, it will require more rapid data com-munications connections and, e.g. theincreasing use of fibre technology.

The infrastructure in Finland is at leastat the same level as in most of its competi-tors. Therefore, the emphasis has alreadyshifted to more extensive and versatileexploitation of the existing infrastructure.Companies are adjusting their old workprocesses so that they will take greateradvantage of information technology, andnew services and more versatile contentsare created to the existing informationchannels.

Finland Still at the Vanguard It has been said that Finland has lost itsposition in the vanguard of informationsociety development. This is, however, atoo black-and-white manner of looking atthe issue. It is true that Finland is notnumber one in the world in all respectsbut, as a whole, Finland can still be said tobe one of the top countries in the world.

The steps that we have taken lately haveimproved our position in many sectors.Finland has also manifested its wish tomaintain its position as one of the leadinginformation societies in the world bycompiling an extensive Information SocietyProgramme headed by the Prime Minister.The programme also has a very centralplace in the present government’s policy.Several hundreds of experts from all fieldsof society, both public administration andcompanies and other organisationsparticipate in the implementation of theprogramme.

Despite the tough competition – or per-haps partly as a result of it – Finland con-tinues to be in the vanguard of develop-ment. A country worth investing in and anexcellent place to look for partners. ❙

Statistics on the sector 2004 complied by FiCom

The number of digital televisionsand set-top boxes in householdsis still modest, but the rate ofgrowth is rapid. In the autumn of2004, the digital televisionnetwork covered about 94 per cent of the population (Statistics Finland and Finnpanel).

The portability of mobile phonenumbers was introduced in Finland on25 July 2003, as the newCommunications Market Act enteredinto force. The act made it possible tokeep the old number even afterswitching operators. At the end ofDecember 2004, altogether about 1.5million numbers had been transferredto another operator (Numpac).

Digital TV Households in Finland

Access to Broadband Internet Services in Finland

Number Portability in Mobile Communications Network in Finland

In November 2004, 30 per cent ofhouseholds had a broadbandconnection. In November 2003, thecorresponding figure was 20 per cent(Statistics Finland and FinnishCommunications RegulatoryAuthority). As compared with a modemconnection, a broadband connectionmore than doubles the use of theInternet. It also increases web tradeand the use of other digital services(TNS Gallup).

FICOM, FINNISH FEDERATION FOR COMMUNICATIONS AND TELEINFORMATICS

FiCom is an industrial co-operation and lobbying organisation in the field of industrial policy concerningthe Finnish telecommunications and message transfer sectors.

FiCom represents the industry in their relations with political decision-makers, authorities, and themedia, both nationally and at EU level. FiCom also monitors and gathers information on the sector andanalyses it in an extensive manner.

FiCom’s members are companies and other entities that operate in the ICT sector in Finland. The totalturnover from Finland of FiCom’s members is about EUR 6.7 billion. Approximately 43,000 people workin their different locations.

Additional information: www.ficom.fi

30

20

10

0

1000

800

600

400

200

0

1600

1400

1200

1000

800

600

400

200

0

November 2002 November 2003 November 2004

1.6.2002 1.1.2003 1.1.2004 1.7.2004 1.10.2004

31.12.2003 31.3.2004 30.6.2004 30.9.2004 31.12.2004

The digital set-top boxes suitable for antenna or cable receivingThe digital set-top boxes suitable for satellite receiving

DSLCable modems

% of households

.000 subscriptions

.000 portings


Press and PR | Finnet


Once upon a time in Finland, aroundthe year 1935... there were 815 private-

ly owned local telephone companies in justabout every village all over the country. Atthat time most other European telecomswere state-controlled. In Finland the state-owned telephone companies co-existedwith privately owned local telephone com-panies. It is fascinating to realize that sometraces of this unique historical backgroundof Finland’s telecommunications setup canstill be seen in today’s market.

Finnet Group is a descendant of thesetraditionally privately owned local tele-phone companies. Therefore, it is a naturalstrategy for Finnet to concentrate on localbusiness rather than to start to competewith the giants of the industry. Finnet’smarket share from Finland’s telecommuni-cations services total market is about 20per cent.

Modern Technology Combined with Quality Service Seppo Toivonen, Managing Director ofthe Finnet Association, is well aware of therecent development and the challenges ofmedia convergence, for example.Acquisitions and mergers have created acompletely new type of industry structurein the past couple of years. In addition,globalization and demographic develop-ments raise the stakes and toughen thesurviving players. Small local players havebeen warned about all different kinds ofthreats. However, according to Toivonen,there is another point of view to be takeninto consideration.

“As far as I am concerned, the cus-tomers will always be reached locally. Nomatter how much there is talk about glob-alization and multinational mega-mergersthere will always be a need for local andmore specialized customer relationships.

Finnet Group Believes in the Power of Locality

27

Most of our customers appreciate the factthat there is a local operator in their area.People like the idea about their own localtelephone company. In fact, it is the veryfoundation of Finnet to operate in thisway. Small scale local telecommunicationfirms can offer their customers the kind ofhigh-quality services that some larger cor-porations are unable to deliver”, saysSeppo Toivonen.

Local Sensitivity as StrengthAs the forces of globalization create everlarger corporate entities on the one hand,the forces of segmentation require moreand more customization on the other.“Local sensitivity is our main weaponagainst our competitors. Finnet operatesalso nationally but our focus will be on thefirst class customer service at the local level. All Finnet’s local telephone compa-nies enjoy trust in their local area. Ourclients are familiar with their local tele-phone operators in the surrounding areas,and people seem to understand that theyactually support their own local well-beingby investing their money to local playersinstead of others”, says Toivonen.

“What will be the role of a telephonecompany in the year 2010? It is definitelyeasier to ask than to answer. We cannotforesee the future but there are some prin-ciples that we must keep in our minds. Asa relatively small player, we must rely onour strengths. We have been doing thisbusiness for over 100 years. Finnet hasvery strong operator know-how. Ourinfrastructure and penetration rates areextremely good. We have a lot of potential,and now we must keep on believing in ourstrategy. Co-operation and positive atti-tude are two key factors that will lead usfor the right path”, concludes SeppoToivonen. ❙

Pho

to M

agnu

s Lö

fvin

g

FINNET GROUP

Finnet is a Finnish telecommunications group, which offers all its clients local and nationalvoice, data, and digital television services. Finnet Group consists among others of 35telephone companies, Finnet Ltd and Finnet Association. The group’s turnover in 2003 was978 million euros.

FINNET’S TELEPHONE COMPANIES

There are currently 35 telephone companies that belong to Finnet Group. These companiesare situated in different cities all over the country. The first telephone companies that belongto Finnet Group were founded already 120 years ago, only six years after the telephone wasinvented. Local presence and close contact with clients are the strengths of Finnet’s telephonecompanies.

FINNET ASSOCIATION

Finnet Association is an industrial interest group and co-operation forum formed by localtelephone companies and other corporations. Finnet Association guarantees that its membercompanies have access to specialised, effective internal services. The association is alsoconsulted as an expert in matters of regulations and stipulations in telecommunications.

FINNET FOCUS LTD

Finnet Focus Ltd’s line of business includes training, communications, and informationservices.

FINNET LTD

Finnet Ltd consists of Finnet’s nationally operating companies. The managing director ofFinnet Ltd is Matti Makkonen. The subsidiary companies of the Finnet Ltd include: DNA Finland Ltd, Finnet Networks Ltd, Finnet Logistics Ltd, and Suomen 3KTV Ltd.

DNA Finland Ltd is Finnet’s national mobile operator, which offers personal and customisedwireless solutions to consumers and companies. DNA’s services use the latest networktechnology. More information www.dnafinland.fi.

Finnet Networks is the GSM/GPRS operator of Finnet that carries calls, messages, andservices. It is also responsible for the planning, constructing, usage, maintenance, andmarketing of the network.

Finnet Logistics Ltd is a national negotiation organisation which coordinates the acquisitionoperations of goods and services of its owner companies both from Finland and abroad.

Suomen 3KTV Ltd is the country’s biggest cable television distribution network. It producesdigital television services for local telephone companies or cable television companies ownedeither totally or partially by them. Suomen 3KTV Ltd’s companies now offer 46 digital TV-channels and 24 radio channels. The services are available to about 280,000 householdsthrough the distribution network.

“Co-operation and positive attitude are two key

factors that will lead us for the right path.”

Seppo ToivonenManaging Director of the Finnet Association

www.finnet-liitto.fi/eng



Elcoteq Network Corporation is expandingglobally to ensure that these products are

available, designed and manufactured with thehighest quality standards for the best possible value.

Products such as mobile phones, set-top boxesand the base stations, and supporting infrastructureare supplied by a multitude of companies. Many ofthose companies rely on Elcoteq as theiroutsourcing partner to help produce the products.

Specialization as Competition ApproachAlthough many large EMS companies choose todiversify into many markets and product offeringsas a growth strategy, Elcoteq has chosen the oppositeapproach, specialization. Specialization promotescompetency, economies of scale, consistency inquality practices worldwide, global flexibility andexpertise in helping customers reach their goals.

The management at Elcoteq understands thatthere are several variables in selecting amanufacturing location: end customer location,complexity, types and volume of manufacturedproducts, delivery location of the product amongother factors. For these reasons, Elcoteq hasestablished manufacturing plants in locations thatoffer the best opportunities to meet its customers’needs.

Expansion in Global Growth Areas Last year Elcoteq made several major expansions tooffer the best service and support to its customers inworld areas where communications technology isgrowing most rapidly.

Elcoteq is the first high volume EMS companyproviding manufacturing services to India’s network

Elcoteq – Establishing a Global Footprint

Communications technology

products are part of the daily life

for people around the world.

29

infrastructure and handset OEMs. A new subsidiarywas formed and began manufacturing handsets inManaus, Brazil. In addition, Elcoteq signed itslargest global outsourcing and acquisitionagreement to date with Thomson. The deal includesacquisition of Thomson’s manufacturing operationin Juarez, Mexico and manufacturing co-operationin the set-top box business making Elcoteq theleading volume producer of set-top boxes.

Elcoteq recently expanded its manufacturingplants in Tallinn, Estonia and has been the largestexporter in Estonia since 1994 with a 14 per centshare of exports in 2003. Additional operations arein Finland, Sweden, Germany, Hungary, China,Korea, Japan, and the United States. A new plant willbe opened during 2005 in St. Petersburg, Russia.

What differentiates Elcoteq from its competitorsis its exclusive focus on communicationstechnology, customers and products. Elcoteq’sstrategy of specialization, establishing a globalfootprint, manufacturing practices and quality, hashelped it achieve continued growth and become aproven leader in electronics manufacturing servicesfor communications technology. ❙

Testing a networkproduct during the manufacturingprocess.


Kaj Nordgren, Communications Manager | Tekes – National Technology Agency of Finland

Information and Communications TechnologiesNew Business Practices and Innovations


| research and development|

3131

Information and communications technologies (ICT)are the central element and driving force behind the

changes taking place in the society and economic life. Thecompanies representing ICT technologies amount to approx-imately 10 per cent of total Finnish entrepreneurship and tomore than half of the nation’s total R & D activities.Innovations and R & D activities have a major impact oncompanies within this field. In the companies dealing withsoftware the investments in R & D may reach up to 30–45per cent of the total turn over.

As a developer of information and communications tech-nologies Finland has reached the position of a global fore-runner being one of the most advanced countries in theworld in adopting ICT. The challenge Finland faces is tosecure that position in the future as well. In developing thebasic technologies the aim must be to adapt and implementtop level know-how and ICT on an ever widening scope ofbusiness activities. Finland’s strengths in global competitioncontinue to be expertise and specialization.

The demand for Tekes’ funding for companies developingand implementing information and communications tech-nologies grew steadily during 2004. The keen interest in thenew type of funding devised by Tekes, namely a startingcompany’s capital loan, was a clear indication of the direneed for funding especially among newly established ICTcompanies. Just about one half of the loan applications forthat particular loan came from those companies. There is asurge of newly established companies especially in softwareproducts and communications development as well as ICTimplementation.

In 2004 Tekes funded the development of information andcommunications technologies with more than 120 millioneuros. Space technology in Tekes is considered part of infor-mation and communications technologies unit and fundingfor space technology in 2004 was 18.5 million euros.

Technology Programme Activities Advancing BrisklyThe major ongoing technology programmes during 2005 areAVALI focusing on the creation of business opportunitiesbased on space technology, ELMO focusing on miniaturizingelectronics, FENIX focusing on interactive computing, andFinnWell focusing on wellbeing. NETS – Networks of theFuture formally ended in the very beginning of this year.

Among the results of the NETS technology programme isthe study charting the future technology trends. According tothe findings, the major challenges during 2007–2012 will bethe consolidation of data network types and services, intelli-gent living environment, transition from network oriented toequipment oriented environment, and the accumulation ofcontent. The aim is to move from the present technologycentered thinking toward increasingly user-friendly technolo-gy development.

Health care sector is an important user of information andcommunications technologies. The FinnWell technology pro-gramme’s underlying idea is to improve the profitability andquality of health care services.

There is plenty of future potential as well in the approxi-mately 50 companies in Finland developing games technolo-gy. Several of these companies participate in FENIX techno-logy programme within which Tekes has made break-throughs in, among others, content business activities.

Among the information and communications technolo-gies programmes brought to a conclusion last year were thespace technology programme Antares and intelligentautomation solutions development programme ÄLY.

Additionally, in the planning stages there are technologyprogrammes focusing on business specific software, broad-band technology, and mobile business solutions. ❙

Tekes is the main public funding organisation for

research and development in Finland. Tekes funds

industrial projects as well as projects in research

organisations, and especially promotes innovative, risk-

intensive projects. Tekes offers partners from abroad

a gateway to the key technology players in Finland.

www.tekes.fi/eng

The technology programmes and projects funded by the National Technology

Agency of Finland, Tekes, invent and develop products, services, and

applications for the benefit of information society and the players within.



How to Get on the Top of PISA Tower... ...and other enigmas of lifelong learning in engineering education

“Putting e-learning tools to serve lifelong learning

is very relevant today. Education systems are seri-

ously facing the modernization challenge as

brought up by the Lisbon process. The importance

of flexible delivery modes and adaptable

institutions is increasing, the scenario is changing

on all levels.”

Markku Markkula, Director of HUT Dipoli

n few years’ time Finland has scored miraculously highalmost on any scale of excellence. She has been awarded

prizes like: “the most competitive economy”, “the least cor-rupt country”, “the home base of the most successful mobilephone company”, “the best readers of the world”, “the beststudents in maths in Europe”, to mention a few.

Is this just a coincidence, or what is it that has made Finnsso successful? There is no single or simple answer to that. Wedo not even try on answering, but let’s have a closer look tosome of the factors which might have something to do withthe Finnish success story.

Prime Minister Tony Blair’s answer to the question of thepriorities of his government some years ago was: “Education,education, education!” The answer became famous, but heand his government were not the first ones to put educationon the top. The same order has certainly been true for longin Finland, claims Matti Sinko, Senior Expert at the LifelongLearning Institute Dipoli of Helsinki University ofTechnology.

For Finns education has been not only a long-standingnational priority but a success strategy for the homes as well.The teaching professions score continuously high in socio-logical studies when comparing the popularity of differentprofessions. Consequently teacher education institutionshave managed to gather year after year many of the brighteststudents of all faculties. Many of the best brains do not hesi-tate to go back to schools as teachers.

Lifelong Learning Sits Well with the FinnsThe chairman of the Board of the Finnish informationSociety Development Centre TIEKE, Markku Markkula, isan enthusiastic developer of new concepts for continuingprofessional development and knowledge management.Markkula highlights that the concept of lifelong learning hasbeen easy to introduce to the Finnish working life. We dobelieve in human capital as the main factor of social and eco-nomic progress on the personal and organizational, as well ason the national and even trans-national level.

Finns have not hesitated to resume a learner’s role, when-ever there has been an intellectual challenge to tackle. Ourworld record high investments on R&D have fuelled oursmall national economy to scale up to being competitive withanyone. We have a thorough understanding of knowledgebased systems intelligence and innovation management onorganizational, national, as well as regional levels, Markkulaexplains.

Markku Markkula, Director | HUT Dipoli

I

33

Dipoli – a Forerunner in the Field of Continuing EducationCombined with the unbelievable curiosity and trust in tech-nological strides has given a head-start also to Dipoli, theLifelong Learning Institute of Helsinki University ofTechnology, to establish its reputation as one of the leadingcontinuing engineering education institutes in Europe. Withits full time staff of approximately 100, 14 Meuro annualturnover, and over 1,500 visiting lecturers per year Dipoliearns its place among the largest institutes in its field. It isDipoli, where Markkula earns his living as the director of theinstitute.

Dipoli acts in the forefront of technological development,offering a wide range of continuing education programmesto engineers. Dipoli also contributes substantially to a greatnumber of research and development programmes. By utiliz-ing e-learning technologies and methods Dipoli aims atbuilding readiness of its customers to respond to the needs oftoday’s and future working life. Dipoli also hosts the teachingand learning support unit of its home university and the ser-vice unit of the Finnish Virtual University.

The community service responsibility of the universitieshas recently received a formal recognition in Finland, whenthis third mission or pillar, has been recently included in theFinnish legislation regulating and challenging the universi-ties. Dipoli’s long-established pivotal position between theacademia and working life has put it once again in the pio-neer role according to Markkula.

Global networking is an essential part of the activities ofDipoli. The institute is a founding member of EuroPACE. Itis also an active participant in, for instance, SEFI (SociétéEuropéenne pour la Formation des Ingénieurs) and theEducational Multimedia Support Network (MENON). Since1992, Dipoli has been a coordinator or a partner in approxi-mately 160 European R&D and training projects increasinglyfocusing on foresight in education and training.

New Ways in Professional TrainingUnderstanding the various ways to effectively support learn-ing at workplace and how this learning support could beorganized in the future, is one of our key success factors, out-lines Tapio Koskinen, Senior Expert at Dipoli. This is alsoreflected in the institute’s participation in two new EuropeanNetworks contributing to the development of new ways inprofessional training. Teaching and Research in Engineeringin Europe (TREE) is a thematic network supported by theSocrates programme. Dipoli takes the leading role of the sus-tainability of engineering competencies action line in thisrecently launched network. Strong emphasis on foresightcharacterizes also Dipoli’s contribution to the Network ofExcellence in Professional Learning (NoE ProLearn) a well-known initiative supported by the 6th FrameworkProgramme of IST. ❙

Specialising in tech-nology and businessknow-how, HUT Dipoli is arecognised providerof lifelong learningand professional developmentprogrammes. Here participants of a seminar reflect on key concepts: innovation,motivation,productivity,systems intelligence– discovering hiddencompetences inhuman activity andorganizational life.

The four corner-stones of success. Strong multidisciplinary approach tolearning and professional development form the basis for design and deliveryof services that Lifelong Learning Institute Dipoli is famous for among itscustomers and partners.

HELSINKI UNIVERSITY OF TECHNOLOGYLIFELONG LEARNING INSTITUTE DIPOLI

in the forefront of technological development.

Lifelong Learning Institute Dipoli P.O.Box 800002015 HUT

www.dipoli.hut.fi/english

Learning Organizationand System Intelligence

Innovation Managementand Foresight

Management ofProcesses,

Competenciesand Quality

Management ofInnovative Working

and LearningEnvironments

Effective CEEManagement

and Leadership


Jukka Matikainen, Marketing & Communications Manager | COSS


Linux with its penguin logo is known asthe flagship of the Finnish open source

know-how. This operating system has risento challenge Windows. Linus Torvalds who,at the time was studying computer science inthe University of Helsinki, started to developLinux in 1990.

Next year, Linus released the first version ofthe system on the Internet. He urged peopleto comment, test, and develop the software.Linus immediately got a huge amount offeedback and error reports. In 1992, almost200 people were already actively working withLinux. The advancement of Linux containsthe focal elements of the open source successstory: openness, the Internet, and innovativesoftware, which inspires accomplished peoplearound the world to participate in the devel-opment work.

At present, Linus lives in San José,California. He continues to coordinate thedevelopment of Linux. His example has itsown influence on the fact that Finns still havea significant role in numerous other well-known open source projects, such as MySQLand IRC.

COSS Developing Business Based on Open Source Finnish employees are often characterized asself-directed and task oriented. This Finnishdisposition seems to be well suited for opensource projects, in which the developers inde-

pendently implement different tasks andparts of the project as a whole.

A wide foundation of knowledge and longtraditions form a strong basis for developingbusiness based on open source. COSS (Centrefor Open Source Software) started at thebeginning of 2004 with basic funding grantedby Finland’s Ministry of the Interior.

COSS aims to improve co-operationbetween the companies that develop and useopen source software. One of the main goalsof COSS is to make different ways of utilizingopen source known in different business sec-tors and user groups.

– There are two COSS directories on ourWeb site: companies and software. Thesedirectories help those who are looking forsoftware and services for their organization tofind matching solutions and corporate part-ners, says the Director of COSS, PetriRäsänen.

Among other things, COSS arranges meet-ings, organizes international co-operation,and offers various services to support busi-ness. COSS also offers legal services providingexpert assistance in licensing and other juridi-cal matters.

In Finland, COSS coordinates co-operationbetween various projects in different regionsand lines of business, and stimulates researchrelated to open source. One of COSS’s activepartners is the Häme Centre of Expertise inthe city of Hämeenlinna.

– The Häme Centre of Expertise focuseson supporting research on e-learning as wellas product and company development. As apartner of COSS we are responsible for deve-loping open source based business in the fieldof e-learning, says Director RiikkaRahikainen.

The Häme Centre of Expertise has alsostudied the use and distribution of opensource software in Finnish education.According to the study, there seems to begrowing interest in open source softwareapplications in the field of education.Constantly tightening budgets, growing dis-satisfaction with vendor power, and the lackof innovation in the proprietary learningtechnologies are the main reasons behind thistrend.

About 60 % of Finnish schools of all levelsare using open source software to carry outtheir practices. The most frequently usedopen source learning platform is Moodle.

The study anticipates a bright future forthe educational open source software usage inFinland. However, it suggests that less passionand more real life experiments are needed, inorder to make open source broadly usedalong the proprietary software in all markets:education, government and business.

The above-mentioned Moodle is a widelyused open source solution – and not onlywithin educational institutes. This learningplatform works well as a competence deve-lopment tool for various businesses, forexample in the world of finance, as our nextcase shows.

Finnish Open Source Flying High from the Very Beginning

Timo Väliharju,Managing Director,Mediamaisteri:“We scrutinizedeverything togetherwith the clients’data managementdepartments.”

Finns have been the carrying forces and

figureheads in the development of open source

software. The Finnish Centre for Open Source

Software, COSS, aims to keep Finland in the van

of development regarding the use of open

source in business, too.

35

Open Source Software is Less RiskyOpen source software is often associated withthe images of high risk factors. A quite oppo-site analysis was made by some of the mostsignificant and well-known Finnish companiesin insurance, financing, and banking: PohjolaGroup, Suomi-yhtiö, Savings Banks, andIlmarinen. Moodle was selected as the plat-form for their common learning network.

– Our hands would have been tied far intothe future by selecting a commercial closedsource solution, yet the development can notbe forecast reliably. In our opinion, an opensource solution is less risky than a closed system, says Department Manager JariHeikkurinen from Pohjola Insurance Group.

In addition to closed source code, the pricewould have been a restrictive factor whenchoosing a closed source solution. The initialcosts of starting a wide commercial learningsystem would have required the investment toproduce advantage for a long time. The cor-porate partners did not, however, want tobind themselves strictly to one closed sourcesolution and its vendor.

Functionalities about the Same – Costs Vary WidelyBefore this project the members of the steer-ing group did not know much about thealternatives of open source. During discus-sions with Mediamaisteri Ltd, Moodle wasmentioned and the steering group started tolook into it. They discovered soon thatMoodle, as well as other alternatives, had bothadvantages and disadvantages. Promises and

features varied. However, each solutionworked in its own way.

The importance of the price was thenemphasized. The closed source solutions didnot, after all, contain anything to justify theirsignificantly higher costs when compared toan open source solution.

The steering group estimates that a learn-ing environment based on Moodle will costroughly five times less than a comparable system implemented with closed source code.

Modular Solutions are Safe and Easy to Customize– We used to have a commercial closed sourceplatform. It was cumbersome to removeunnecessary functions from it. They dis-turbed the learning of the subject matter, saysDevelopment Manager Maija Nurmi fromSuomi-yhtiö Insurance.

In Moodle, each module of a project has itsown person in charge. Parts can be developedindependently. The modular structureensures that Moodle adapts easily for diffe-rent clients.

One of Moodle’s focal features is its cus-tomability, which was decisive in selecting theopen source solution. The learning environ-ment will be developed further, and later thecompanies will make customized contentsand solutions according to their needs.

Every now and then, there are groundlessdoubts about the data security of open sourcesoftware.

– We scrutinized everything together withthe clients’ data management departments.

Their standards were strict, but we found noproblems in data security or anything else,says Managing Director Timo Väliharju fromMediamaisteri.

Mediamaisteri is closely involved in theMoodle project. However, the company doesnot strive to offer the newest applications andfeatures to their clients at once.

The goals of these companies that produceadded value to open source solutions are oftendifferent from the companies which havebound themselves to commercial software. Anopen source deliverer can participate in theproject and simultaneously observe and evalu-ate the development work critically from aclient’s point of view. New features are pro-foundly tested instead of trying to vend newversions which are less than ready or onlysuperficially improved, which sometimes happens if you try to sell products as early aspossible.

The Gateway to Finnish Open SourceOpen source has established itself as part ofsoftware business. Finnish open source soft-ware development has, from the very begin-ning, been of high quality at the grass roots,in practical software projects. Petri Räsänen,the Director of COSS, encourages all interest-ed partners to contact COSS:

– You find our contact information atwww.coss.fi. We are open to your ideas andco-operation opportunities! ❙

Jari Heikkurinen, Department Manager,Pohjola InsuranceGroup:“An open sourcesolution is less riskythan a closedsystem.”

Maija Nurmi, Development Manager, Suomi-yhtiö Insurance“We used to have acommercial closedsource platform. Itwas cumbersome toremove unnecessaryfunctions from it.”

Petri Räsänen,Director, COSS:“There are two COSSdirectories on ourWeb site: companiesand software.”

Riikka Rahikainen, Director, Häme Centre of Expertise:“As a partner ofCOSS we are respon-sible for developingopen source basedbusiness in the fieldof e-learning.”

“COSS wants Finland to lead the way in developing

other parts of the open source ecosystem too. COSS

participates actively in international co-operation.

We convey Finnish open source know-how to various

partners: for example internationally operating

businesses, the public sector, and research institutes.”

Petri Räsänen, the Director of COSS


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In Eastern Turku suburbs a lot of immigrantsbenefited from theproject. Children wereeager to adopt newcommunication tools inevery OSKU region.

| regions|

In 2001, Sitra – the Finnish NationalFund for Research and Development –

implemented an extensive informationsociety project, OSKU (Oppivat seutukun-nat – Learning Regions). Regional authori-ties, municipalities and local business andindustry contributed to the funding andimplementation of the two year-project.Altogether OSKU covered 180,000 inhabi-tants in eight regions in Finland.

Segregated Groups in FocusThe initiative proclaimed that ICT skillsand use of the Internet benefit people intheir day-to-day lives, improve quality oflife and deliver new opportunities for indi-viduals and communities.

In 2001, 59 per cent of the Finnishhouseholds had a computer and 43 percent had an Internet connection. Insparsely populated rural areas the figureswere substantially lower.

The digital divide was related to the lackof telecommunications infrastructure, butalso to the lack of motivation and low skilllevels. The main groups still segregatedfrom the rapid ICT development wereespecially the elderly and people with lowincome and lower educational back-ground; the unemployed, immigrants etc.

Sitra’s objective was to find good prac-tices and examples in drawing the segre-gated groups into information society byimplementing local “grass root” actions.

Local Know-How Essential The networks and cooperation skills of thelocal citizens, associations and volunteers,

and their connections to other stake hold-ers in the area were essential to the successof OSKU. Efficient communication tools(web sites, intranet systems) proved to benecessary, when the inhabitants wished tohave an impact on issues concerning theirenvironment. Digital dialogue with themunicipality was needed, but the localswere also able to provide accurate ‘inside‘information into the net.

Success in Narrowing the Gap OSKU had a positive impact on informa-tion society development in several areas.Thousands of people without earlier ICT-education were encouraged to utilize theInternet, and computers and Internet con-nections were purchased more eagerly

Access to the InternetA Matter of EqualityHeli Rantanen, Project Manager | OSKU Project

Senior citizensappreciated peaceful andindividual ICT -trainingsessions. Trainer Klaus Luohio had only two pupilsat the time while teachingbeginner’s computer skillsin Maunula.

The writer, Heli Rantanen, architect and researcher was a Project Manager in one of Sitra’s eight OSKU –projects,Nettimaunula, in Helsinki 2001–2003. All Sitra’s activities aredesigned to promote the economic prosperity of the Finnish people. Email [email protected]/eng/index.asp?parent=871&DirID=92www.kaupunginosat.net/maunula/kehittaminen/osku_engl.htm

than in other areas nationwide. However,differences between rural and urban areasstill exist.

Sustainability became a challenge, asnot all the municipalities took responsibi-lity for the activities after the project. Allthe services – education, local web portals,Internet access points – are quite expensiveto maintain. A large network of accesspoints was expensive to maintain.Provision of broadband connections to thedistant rural areas and the quality andprice of the broadband would be essential.

Only the permanent changes in the wayspeople use and benefit from digital tech-nology in the daily life tell us, if the inter-vention of OSKU has been successful. ❙

37

Jyväskylä – Human Technology CityKnown for Its User Friendly Internet Site

Markku Andersson, Mayor | City of Jyväskylä

The City of Jyväskylä’s Internet site hasreceived positive feedback from evalua-

tions measuring, for instance, the site’s userfriendly quality. Already for the third time thesite received top placement in comparisonstudies carried out by iTest Oy comparing 28Finnish counties’ corresponding sites.

Internet is a very important tool in thecity’s present operations. It is used to conveyinformation and to serve the citizens, as wellas for marketing activities to various parties.The site offers discussions and receives feed-back from the users. It encourages the citizensinto participation and offers an opportunityto have true influence on matters of commonconcern. Without the people in both ends ofthe Internet there, indeed, would be noInternet! Internet is not merely a “technologi-cal system” but, at its best, an interactivechannel between people.

Clarity and User Friendliness the Key ElementsIn developing Jyväskylä’s Internet site specialattention has been paid on clarity and userfriendliness. The very core in the aims hasbeen to strive for correct and up-to-dateinformation and logical structure.

Especially during the last few years, theaccessibility has been one of the heart-felt pri-orities. In the city’s view accessibility is a twofold matter: technological and content relat-ed. The Internet site has to work browser orinstrument independently. The texts must beunivocally understandable and clearly struc-tured, the search words and page searchesmust be in order, and the site navigation mustbe coherent.

An Internet Site Is Never Complete The citizens are looking forward to the abilityto carry out a growing number of concretetransactions in the net. Jyväskylä has, forexample, received praise of its libraries’ com-prehensive www-pages and directories,regional lending service, and user training.

During the last few years Jyväskylä hasbeen, population wise, Finland’s fastest grow-ing city and the second most attractive migra-tion target. The use of properties, zoning andconstruction, as well as the various modes ofavailable housing, interest people. The city’sInternet site offers the citizens the possibilityto participate in the city planning with com-ments and questions. The city engineer’swww-site contains numerous instructionsand documents that aid in construction pro-jects. Environment and waste collectionreceive equal attention. The Internet site alsoinforms about the different housing sites’waste collection points, as well as providesadvice on recycling, nature trails and, duringthe summer, the water condition of thebeaches.

The questions sent by the citizens and other users of the site on various topics are

“The city’s Internet site offers the citizens

the possibility to participate in the city

planning with comments and questions.”

Markku Andersson, Mayor City of Jyväskylä

answered by the corresponding countyexperts. The JyväskyläTori (= Jyväskylä-MeetingPlace) chat forum facilitates discus-sions on just about any topic under the sunand serves as a forum for private citizens andorganization to post their announcements.

The Chance in Operational CultureFurthers Business OpportunitiesThe Internet has become a county organiza-tions’ permanent service channel. In thefuture that means ever more need for contentexpertise, changes in operational culture and,along with technological advances, growingneed for increased competence. A part ofusability issues can be solved with technology,however, it is most important to see beyondthe Internet and focus on the person usingthe service and his needs. Technology merelyfunctions as the servant. ❙

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eTampere programme’s general objective is to make thecity of Tampere a global leader in the research, develop-

ment, and application of issues related to the KnowledgeSociety. The starting point of the programme is to develop asustainable knowledge society that supports active citizenshipand innovative business.

eTampere is an extensive collaborate project to which thelocal educational and research institutes, businesses, govern-ment, organisations, and communities contribute their ownexpertise and input.

The eTampere programme consists of six independentlyoperating sub-programmes: Information Society Institute(ISI), eBusiness Research Center (eBRC), Research andEvaluation Laboratory (RELab), eAccelerator, TechnologyEngine Programmes, and Infocity. The entire programme iscoordinated by the eTampere office. ❙

eTampere Builds the Well-being of the Future

Among the eTampere areas of emphasis are:Company cooperation and e-business

eAccelerator strengthens cooperation particularly with medium-sized growth companies that have a strong link to industry■ A new model for capital investor cooperation, the “from

idea to international success” concept, a financial andaccount management tool for growth companies, an expertpool in different areas of business

eBRC is a strong research centre and development programmeseeking to understand business in knowledge society■ Business development, knowledge management, strategy

forming in the knowledge society■ eSME service to facilitate the adoption of e-business in SMEs■ Venture – to – Capital (V2C)

Infocity focuses increasingly strongly on supporting the multi-channel development of public service processes■ Internet, mobile phones, digital TV■ on-line self-services■ new forms of eDemocracy■ access and training

Transfer of research knowledge into product development, products and services

RELab focuses on the development of industrial service-orientedproducts and business, and the transfer of research results tocompanies and communities■ through a development centre for service-oriented

industrial business, companies in the region find practicalanswers to key factors for success in the world of service-oriented products

Technology Engines focus on the application of new technology andthe utilization of research results in companies■ the Optoelectronics training and research centre is one

example: SMEs, too, get access to the latest researchknowledge, measuring services and training, increasinglyefficiently and economically

ISI promotes the construction of a knowledge society based onactive citizenship through multidisciplinary research, developmentand educational activities.

eTampere concentrates on three themes: 1) Network services that ease citizens’ daily lives are

developed and brought within the reach of everyone.

2) The foundation of expertise in research and education is strengthened.

3) New innovative business is created.

Ulla Hartikainen | eTampere

“eTampere is critical but curious, daring

but humble, a builder of the new that

respects the old.”

Jarmo Viteli, Director of eTampere-programme

| regions|

Ask for more information: [email protected], www.etampere.fi

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In four months’ time, September to December 2004,

10,000 more SME’s started to use eInvoicing in Finland.

“eInvoicing LivingLabs”to the Resque of SME’s

Technology Centre Kareltek Inc

needs instead of the availability of techni-cal solutions, tells Vice President RaimoNäätsaari from Nordea Bank.

eInvoice is a win-win solution to allplayers bringing better competitiveness tothe economy as a whole, however, onlywhen the degree of usage of the eInvoicesis high enough. In this, public financingcould speed up the adoption of eInvoicesby helping SMEs.

Regional eBusiness projects in differentparts of Finland have an important rolein the development in keeping all theplayers around the table by means ofworkshops, real-life testing, and by pro-viding discussion forums. In that regardthe eInvoicing LivingLab is a very impor-tant mechanism, tells Project ManagerJarmo Kovero from Päijät-HämeeBusiness region. ❙

eBusiness regional projects in Finland arereferred to as “eInvoicing LivingLabs”

with the focus to help SMEs to start imple-menting new ICT applications and employeesto use them efficiently.

One of the main purposes of the regionalprojects is to speed up the adoption ofeInvoicing in B2B and B2C with the regionaltarget set to reach eInvoicing penetrationlevel of 50 % in two years.

“By experience we have found out that inorder to achieve this goal it is necessary tocombine all regional players to support theproject”, tells Project Manager Kari Korpelafrom South-Karelia eBusiness region inSouth-Eastern Finland.

Larger Entities Serve as Catalysts “Large companies and public organizations(often called ePioneers in Finland) havegreat interest in receiving eInvoices and,thus, on automating their supply chain management processes, procurement, andbookkeeping,” explains Korpela.

The same desire is visible in GlobalBusiness networks which have become veryimportant to SMEs. The first step large com-panies commonly demand from SME’s isthat they start utilizing eInvoices.

Software companies have to implementnew eInvoice standards in their softwareapplications, as the new eBusiness applica-tions will give more freedom to spread andshare the work between SME’s and auditingcompanies.

Banks Play a Major RoleBanks play an important role being able toprovide the needed infrastructure and a solid opportunity to ease the workload whentransferring the document exchange withbusiness partners into electronic form. Inthe Finnish example the banks have not onlydelivered the e-invoice format, but theFinnish Banker’s Association’s electronicFinvoice solution also includes a working

model with role descriptions, responsibil-ities, and needed supporting routines forcommunication.

One of the main benefits of the work isthat corporate customers of any size cannow join the network with their preferredsolution. For some this would be theNetBank, for others more advancedEnterprise Resource Planning ERP sys-tem. These two different interfaces willthen interact and enable the parties tocommunicate.

Banks have also put a lot of effort toensure that the straight through process-ing requirements will be fulfilled, havingmoved the focus further from mere work-flow parts with the electronic images ofthe invoices.

Works Also in B2C TransactionsThe solution will also cater to the needsof B2C eInvoicing. This way corporatecustomers can really start to streamlinetheir invoicing based on their business

eBusiness portal www.eliiketoiminta.com Kari Korpela, e-mail [email protected] Jarmo Kovero, e-mail [email protected]

eInvoicing infrastructure in Finland

The software sector in Finland has avalue of approximately 3,800 million

euros. Non Finnish companies wishing tocarve out a slice of this have two options:to operate from abroad, or set up asubsidiary company, possibly by acquiringan existing Finnish operation. The cost ofdoing business in Finland is verycompetitive. The corporate tax rate is oneof the lowest in Europe, 26 per cent from2005. Skills and know-how are available,literacy levels, including computer literacy,are high, and Finns are known for theirpositive approach to technology.

In software, the essential element is trust.In B2B operations in Finland, it is possibleto get access to the end customer,something not always the case elsewhere.One quite clear result of this is thatsoftware companies move to a higherposition in the value chain. Finland hasoften been cited as an ideal “testlaboratory” for new products and services.People are technically oriented and keen totry new products.

High Quality R&D Infrastructure The ICT cluster in Finland has been muchhelped by public investment in highquality research and development ofinfrastructure, and by one of the world’s

most effective schemes for fundingresearch and development activity. Finlandalso has several unique resources such asOctopus, SoftaTest and FENIX, NationalTechnology Agency of Finland Tekes’technology programs. The result has beena very rapid growth in the ICT sector overthe last ten years.

Octopus is a unique network set up topromote the creation and development ofnew mobile services. Offering support allthe way from initial innovation throughdevelopment and testing to marketing,Octopus provides companies operating inFinland with an advanced platform fortesting new mobile applications andservices in a genuine operatingenvironment. SoftaTest offers anextensive contact network whichprovides access to companiesand resources, to jointdevelopment programs run bycompanies and educationalinstitutions, and to servicesprovided by its Mobile Lab.

The primary goal of FENIXis the development of user-friendly applicationtechnologies and products orservices for consumers,corporations, and public bodies.


| investments in finland|

Invest in Finland’s ICT team at your service. Tuija Tommila (left), Oili Liukkonen, Sari Tanskanen, Atso Vainio, and Mari Kankaanranta.Taneli Saari is missing from the picture.

While companies that sell ICT products and services know and understand their own

portfolio and skills, matching these to a new market is much easier with a little expert

help. Moving into a new country to do business is not a complicated process as long as

you know what to do. Plans made in isolation can turn out to be less than complete.

FinlandEasy Going Markets and Highly Efficient Business Environment

For further information on Invest in Finland servicesplease visit www.investinfinland.fi

or contact

Atso Vainio tel. +358 9 6969 [email protected]

Taneli Saari tel. +358 9 6969 2527 [email protected]

41

located mostly in Scandinavia. Ardin Softwarealso represents other Russian companies thatwork in the same sector.

Ardin Software’s second step has been anexpansion in Finland and moving toTechnology Center Kareltek. “Establishing abusiness in Lappeenranta helps us assist localcompanies in creating connections withRussian high-tech companies and researchfacilities. We can act as a channel betweenlocal and Russian companies and offer topRussian expertise. We will also be hiring localpeople to take care of our business here”, tellsArcady Khotin, Managing Director of ArdinSoftware Oy, a St. Petersburg-based softwarecompany.

“Every Day Offers Something New”Khotin is pleased with the assistance receivedin Finland. “Invest in Finland did an excellentjob for us. Without them we probably wouldnot have dared to come. They gave us a lot ofuseful information”, tells Khotin and adds,“Finland is not a corrupt country. I receivedfair treatment. For me, every day here offerssomething new. It gives me energy. I love it.”

Future prospects for the Finnish ICTsector, and Ardin Software’s business, lookbright. According to a report on softwaresector prospects published in December 2004,75 per cent of the software companiesoperating in Finland expect their turnover toincrease. In Khotin’s words: “The industry iswarming up again, the demand is here”.

Website Service for InvestorsAs part of its website, Invest in Finland has anon-line service that enables companies toregister at the site for free and requestinformation packages on specific sectors orareas of investment.

Invest in Finland helps foreign companies tolocate in Finland and take advantage of theregion’s competitive business environment. Itworks as an efficient link between foreign anddomestic companies and it provides all theinformation required to establish a business inFinland. ❙

For further information on Invest in Finland servicesplease visit www.investinfinland.fi

or contact

Atso Vainio tel. +358 9 6969 [email protected]

Taneli Saari tel. +358 9 6969 2527 [email protected]

“We can act as a

channel between

local and Russian

companies and

offer top Russian

expertise.”

Arcady Khotin, ManagingDirector of Ardin Software

Expert Advice and Assistance Invest in Finland is a government agencywhose task is to provide help andassistance to companies who wish toestablish operations in Finland. Many ofthe questions asked by Invest in Finland’sclients are of a down-to-earth nature –such as the cost of renting office space.There are more general questions: Whatabout languages, levels of computerliteracy? How does staff recruitment work?Other queries are more specific: Are therereliable sources of information onconsumer or company behaviour?

Invest in Finland offers assistance inresearching alternative ways to establish orexpand a presence in Finland. Questions,that Invest in Finland is in a uniqueposition to provide assistance with, includethose concerning salary levels and labourcosts, the types of support that areavailable, and the best ways of expandinginto Finland – opening a sales office,acquiring a Finnish company, setting up aresearch and development facility and/ormanufacturing unit, or expanding existingoperations.

Successful Entry to the Finnish marketIn the middle of December 2004, city ofLappeenranta based Technology CenterKareltek Inc. (Kareltek) signed acooperation contract with Ardin SoftwareOy, a Russian-owned company which hasbeen operating in the HelsinkiMetropolitan Area for two years. ArdinSoftware works in close cooperation withthe Russian company Arcadia Inc.providing software services for clients

In its mission statement, targets of theFENIX program are said to be productbased businesses and projects which‘contribute to competitiveness and know-how in the long run’. Commenting on theprogram, Klaus Oesch, FENIX ProgramManager, said “This is investing in theinformation society, not just technology, inthe way people educate themselves in theinformation society. It is also aboutcommunities, how they are developing andcreating content. FENIX is certain toprovide new openings and opportunitiesfor product development and newapplications.”


Mauno Konttinen, Deputy Director General | STAKES

| products and services|

The core of the concept is “SendaiSun” service delivery model. The first

real application of the entity has beenerected in the City of Sendai, around 330kilometers northeast from Tokyo, where anew elderly care facility opened its doors inDecember 2004. In its close vicinity, aresearch and development institution willbe inaugurated in March 2005. In theJapanese welfare market, the concept“Finnish Wellbeing Center” is alreadyknown as a brand.

Japan is one of the fastest ageing nationsin the world. The recent and still on-goingprofound societal changes in Japanesefamily and working life steer the trendtowards institutional care of seniorcitizens. In Finland, the direction isopposite, i.e. towards the support ofindependent or autonomous living inhome-like conditions. Japanese authoritiesand experts have, for a long time, taken aclose look at the Nordic and, especially, theFinnish model of elderly care.

Finnish Wellbeing Centeran Innovative Landing to Japan

and/or the staff. The functional careconcept is based on the ”Sendai Sun”seamless care model, which emphasizes thedignity, autonomy, activity, andrehabilitation of senior citizens andfacilitates their integration to thesurrounding society. The keys to achievethese goals are a well-trained andmotivated personnel and well-managedprofessional teamwork. An integral part ofthis working method is the skillful,frequent use of modern IT equipment.

Sendai-Finland Wellbeing Center R&DUnit, in the close vicinity of the carefacility, comprises about 1,000 sq m ofmeeting rooms, an exhibition space andeight office rooms to be rented to academicinstitutions, researchers, and welfarecompanies. The Unit will serve as ascientific research facility, technologydevelopment agency, and businessincubation hatchery in the field of aging,related services, geriatrics, gerontology, andgerontechnology. Several Japanese-Finnishjoint projects will be conducted in the fieldof IT. ❙

Sendan-no-yakata “Terve” elderly care facility in Sendai, Japan

“Sendai-Finland Wellbeing Center”The “Sendai-Finland Wellbeing Center” isthe name of a complex consisting of twoadjacent buildings in the Mizunomoriarea, around four kilometers northwestfrom downtown Sendai. The biggerbuilding is an elderly care facility, alreadycompleted, and the smaller one – aresearch and development center, will becompleted in March 2005.

Sendan-no-yakata “Terve” is the nameof the special nursing home. Its 5-floor,5,500 sq m premises offer single rooms for120 clients: 100 beds for long-term careand 20 beds for short-term stay. Inaddition, there exists a day care unit for 15clients, rooms for rehabilitation, recreationand hobbies, as well as – of course – aFinnish sauna with pool. The house islargely equipped with Finnish furnitureand accessories, including several pieces ofFinnish IT know-how. The feasibility andfunctionality of many IT solutions –including a small IT platform and wirelessmonitoring of motion capability – will befurther tested for the best of the clients

What does “Finnish Wellbeing

Center” or “FWBC” mean?

The answer is: the name and trade

mark of a recent Finnish innovation,

which comprises a modern Finnish

elderly care concept complemented

by advanced Finnish technology.

43

FWBC Finland OyDuring the planning phase of the

FWBC Project, 16 Finnish welfare

industry companies, mostly

SME’s, joined the project to

introduce their products to the

FWBC complex, and on a broader

base, to the Japanese welfare

market. Later on, 11 of these

companies established a joint

stock company – FWBC Finland

Oy – for further promotion and

marketing of the unique FWBC

care concept and integrated

technical products. Also a

subsidiary of the company

– FWBC Japan Ltd – has been

founded in Sendai.

View from an individual room Sendai cafeteria

Combination of Service Expertise and Advanced Technology A New Export Product

The uniqueness of the described end-product of the project is based on theinseparable integration of a good, tested, and validated Finnish care concept andFinnish high-tech welfare products, including several IT systems, applications, andequipment. The end-product can be divided into smaller, independent functionalmodules for further marketing. By combining various know-how and productmodules, the requirements of new customers can be tailored case by case.

According to a recent report launched by the Finnish Ministry and Trade andIndustry, it is of extreme importance to promote innovations in the field of serviceexpertise and advanced technology to new products for the needs of ageingsocieties. In practice, when developing new services for silver citizens, informationand communication technology is in key position, for instance to promote the useof virtual services. New potential service concepts should be effectively identified,developed, conducted to products, and “branded”. To manage in this work, public-private partnership is an essential prerequisite. All above principles and goalshave in good style been achieved in the Finnish Wellbeing Center project. Theinternational propagation of the end-product still requires further efforts.

The author is the Deputy Director General of the Finnish National Research and DevelopmentCentre for Welfare and Health STAKES, working for the FWBC Project since the beginning of2004 in the service of Finpro, the organization promoting the globalization of Finnish trade.


cient tools that automate most of the pro-gramming work. In the end, the buyer cancompare what was designed and simulatedwith what was implemented. Integrationallows different building management sys-tems to work together seamlessly and to becontrolled according to needs and situa-tions.

So what does COBA enable in concreteterms? Premium quality building manage-ment systems implemented with minimalcosts. Smooth electronic system creationprocess with drastically improved efficien-cy. No manual work, no errors. Mass-pro-duction of mass-customized buildingmanagement systems. Glue between con-struction and ICT clusters.

Smart home is not a new idea, and ithas been approached from many view-points. Some focus on networking house-hold appliances, others on entertainmentelectronics. The most fundamental sourceof added value and, thus, the most naturalapproach is building technology. When theinhabitants in the residence change, theyusually take their stereos with them.Building technology remains in the build-ing. A building operating system, likeCOBA, can be utilized for networkingentertainment and household devices effi-ciently with the building technology.

Gaining full benefits from this forefronttechnology on a global scale will requirenetworking of excellent companies in eachmarket. In the past, Finnish companieshad strong influence on creation of theGSM standard. The same could be nowhappening in the field of building man-agement systems. ❙

New Era of Building Management

Previously a builder of a one-familyhome had to deal with at least four

different vendors. Now automation ispackaged with the rest of the buildingtechnology, thus the customer gets thetotal package as a turn key solution. Smartbuilding management systems ensure notonly superior indoor comfort and out-standing security, but also minimizedoperating costs of the facility.

The foundation of the concept is thebuilding operating system, named COBA(Connected Open Building Automation).COBA definitions were created in a stan-dardization project of companies repre-senting various industries, from telecom-munications to construction and services.When the standardization project started,its vision was to create an operating systemfor buildings, which would offer an openstandard for easy and secure access tobuilding functionality. Today the technolo-gy is in extensive commercial use. Thevision proved to be right already in thefirst projects.

Common Interface Connects Building Management SystemsThe building operating system offers acommon interface to all facility manage-ment systems: heating, cooling, ventila-tion, lighting, consumption metering,access control, video surveillance as well asburglar, fire and humidity alarms. The def-initions also include modeling of build-ings, spaces, devices, systems, and users inaccordance with International Alliance forInteroperability’s IFC model. The IFC con-cept is based on the idea of objectsbrought together in an integrated model.

The efficient design and implementa-tion process is based on open interfacesand modeling. The designer collects therequirements and designs the solution uti-lizing ready models and templates. Theintegrator completes the project using effi-

Lonix provides core technologies ofsmart building management systems. Inaddition to Finland, the company hasreferences in Sweden, Norway, Russia,China, and Middle East. www.lonix.comwww.coba-group.com


Anu Kätkä, Marketing Director | Lonix Oy

Home automation used to be a luxurious dream with overwhelming

design costs. In Finland these dreams have been turned to everyday

reality even for builders of one-family homes through mass tailoring

software and standardization.

Smart homes are now easy

to buy. Intelligent building

technology is available as

a complete package with

automated tailoring for

customer requirements.

45

Ellibs initiated the eBook technologyproject in 2002 together with Finnish

telecommunications operator Elisa and theUndergraduate Library of HelsinkiUniversity. By 2004 the amount ofcustomers grew to over 200, includinguniversities, educational organisations, andenterprises in Finland and Sweden. Theelectronic book has become aninformation tool among students andprofessionals in Northern Europe.

Kristian Laiho, the founder of EllibsLtd, built his business plan based onresearch made during the Internet boom.“I was looking for business opportunitiesas project manager in a turbulent newmedia enterprise. I learned about contentand earning problematics of portaloperators, and started to search for a newapproach to replace the ‘supplier – channel– advertisement’ – thinking.”

Over Half of the Finnish Polytechnics use Ellibs Web LibraryToday Ellibs represents nearly hundredscholarly literature publishers while thenumber of eBooks is expected to grow to20,000. Among the well-known publishersare Palgrave Macmillan, WSOY, Edita, andOtava. In addition to commercialpublishers, the selection will grow withpublications of research organizations anduniversities in Europe. The most recentcontracts have been signed with BritishTaylor & Francis and Nordiska AfrikaInstitutet of University of Uppsala, whichstart publishing eBooks during the spring2005.

Finnish educational organizations haveadopted the use of eBooks. Over half of thePolytechnics have acquired Ellibs WebLibrary. In addition, for SMEs Ellibs offersPersonal Web Library – a software withwhich a purchaser of a book can borrowan eBook without having to use anyintranet or library portals.

Ellibs Aims at Becoming European-Wide Operator Ellibs will launch its Web Library inLondon Book Fair in March 2005. “Ouraim is to build a European informationdelivery channel, from publisher to end-user using the well-established libraryinfrastructure as a procurement channel.Marketing and contents will be operatedlocally while the technology is managed inFinland”, tells Kristian Laiho.

Ellibs together with the UndergraduateLibrary of Helsinki University copiedoperation mechanisms of a library in orderto procure eBooks in a traditional way. Thepublished books will be converted toeBooks with Digital Right Management(DRM). It allows the publisher decide whatthe borrower or purchaser is allowed to dowith the book. eBook can also be borrowedfrom a library web-portal using the pincode on the library card.

Ellibs has taken into consideration theearning logic and the procurement culture

Ellibs Europe’s Leading eBooks Provider

Ellibs Ltd. is a content technology-based e-bookprovider selling the services andcontents in e-books and lendingsystems which includes non-fictionbooks from local and internationaltop publishers in Europe. Budget for 2005 500,000 eurosEmployees 8www.ellibs.com

Ellibs Oy Ltd

of libraries. The earning logic is based onbooks sold, like that of book stores, and onWeb libraries. “Our earning logic increasesprofits of publishers and dropsprocurement costs of books. Everybodywins.”

What Do Libraries Think of eBooks The Undergraduate Library of HelsinkiUniversity, the biggest among the Finnishstudent libraries, has tried to resolve theinsufficiency of textbooks with otheruniversities through new publication anddistribution solutions.

“The distribution of eBooks is new forour customers. The feedback received fromthe students has mostly been positive.Some questions have arisen concerningdownloading and other technical issues.The eBook service works as a usefulsupplement in addition to conventionalmaterial,” says Matti Hjerppe, the Directorof the Undergraduate Library. ❙



Digital games take the lifeless core ofhigh-technology and give it a heart of

fun and entertainment. The increasingpresence of games and the game culture isundeniable. Digital gaming draws peopleto technological frontiers fulfilling theirpotential with dreams and aspirations, andwith fragments of everyday life – thingsthat ultimately matter the most.

Yet the possibilities offered by gaminghave not been systematically explored –what impact could games, in their myriadof solutions, have on the larger world ofdigital communication?

To harness these possibilities and toexplore possible answers, LudoCraft com-bines scientific, experimental approacheswith artistic production and high-techno-logy development.

As a response to the changing times, thefield of digital interaction needs a face-lift:new innovations, new solutions, new con-cepts for interpersonal mediation andcommunication. In spite of this need, thevast array of possible solutions alreadyimplemented in multiplayer digital gameshas largely gone unnoticed: from richinteraction to tailored contexts, gamesoffer a wide range of communication andcollaboration models.

Furthermore, many issues tackled bycomputer games are practically absentfrom the field of digital communicationand its applications: designed user roles,narrative sequencing, simulation and environmental presence, time-criticalusability, etc. The wealth of interactionoffered by gaming is exceptional – it mightwell be unparalleled in the digital world.

To pick just one concrete example: thelack of intuitive signs of interaction hasbeen a persistent problem in digital com-munication, separating it from face-to-face

Tony Manninen | LudoCraft Game Design and Research Unit, Department of Information Processing Science, University of Oulu

Northern Cultural Heritage Meets High-Technology AirBuccaneers

LudoCraft/Department of Information Processing Science 2005

47

encounters. Yet, from the world of digitalgames one can easily find new perspectiveon this problem: gaming provides a widerange of implementations of versatile self-expression, promoting a broader view ofinteraction.

A Line of Novel Applications New Solutions for CommunicationTo explore and develop new solutions forcommunication and collaboration,LudoCraft has designed a line of novelapplications based on game technology,harnessing cutting-edge third-party plat-forms. These applications can be used asscenarios of collaboration both locally andglobally.

Among these applications is Air-Buccaneers, a team-focused multiplayergame that emphasizes co-operation.Implemented as a culmination point ofprevious research, the design ofAirBuccaneers employs a variety of theo-ries, both loaned and constructed. Thetheoretical framework laid out by theresearch has enabled LudoCraft to empha-size specific areas of interpersonal interac-tion.

Yet game without a strongly developedbackground presents a shallow experience,no matter how competent its technology.Without a world behind it, game has nohook to draw the players in, no depth forimmersion. Indeed, most of the leadingbrands of digital gaming are based on con-tent - worlds, characters, genres, and styles– rather than on technology.

This is characteristic to game develop-ment: the technical implementation anddesign must constantly be balanced againstartistic content, with an eye towards aseamless whole. Here lies also the reasonwhy LudoCraft takes a holistic approach to

gaming: to truly understand and developdigital games, all areas essential to gamingmust be present and accounted for.

Inspired by Cultural Heritage – Legends, Mythology, and HistoryWhen planning the world of Air-Buccaneers, LudoCraft turned towards asource rich in potential, but rarely used ingaming: the cultural heritage – legends,mythology, and history – of their nativeFinland and its neighboring areas. Thissource had many merits: operating in anacademic environment, LudoCraft is sur-rounded by a wealth of human expertiseand material on the Finnish heritage. Thisenabled the use of an existing and robustknowledge network, without the need toestablish a new one.

Towards this rich material base, a sys-tematic approach was formed: when apiece of legend or mythology was adoptedinto AirBuccaneers, it was translated into adesigned vision of the world: common,important elements were inserted, polish-ing the material towards the needs of thegameplay.

This combination of a powerful know-ledge network and a flexible and systemat-ic approach yielded great results. It allowedLudoCraft to establish a deeply rootedsense of a wider world surrounding thegame, but did not unnecessarily constrainthe gameplay development.

Additionally, the Finnish mythologyproved to be a treasure trove for fantasywith a distinct, exotic character. Throughthe years, the fantasy genre has shownexceptional staying power in digital gam-ing – practically every period of time con-tains milestone games in the genre. This isnot surprising: the potential for escapism,offering worlds beyond our daily reality, is

a strong suit for both digital games andfantasy – their assets are convergent. Yetthere is always the danger of taking a triedand true solution too many times. In lightof this, mythological sources were used asa method of providing twists to the fantasygenre, which is arguably in danger ofbecoming too stale and repetitive.

Experimenting in a Systematic MannerOne of the major principles of LudoCraftis to be experimental in a systematic man-ner: to explore and to analyze. This wasalso true in the case of AirBuccaneers, andits development. From the interactiondesign to the exploration of cultural heritage, the aim of LudoCraft was both todevelop the best application possible, andto use that development for experimenta-tion and studying in order to best learnfrom the work undertaken.

LudoCraft believes in holistic design ofinteraction, content, and environment; thenecessity of combining artistic vision withtechnological excellence; the encapsulatingpower of theory and analysis; and theundiscovered potential of game design.

One should never lose sight of thepotential: the greatest goal of interactionlies not in the seamless replication of thereal world – it lies somewhere yet to beseen, yet to be invented... somewhereanew. ❙

LUDOCRAFT IN BRIEFLudoCraft studies games and applies the theoretical knowledge into game design. The approachcombines theoretical, technical and artistic expertise in serving both the academic and the practitionercommunities. The mission of LudoCraft is to distribute the knowledge of analytical gamers and gamedesigners for the benefit of wider audience. See http://ludocraft.oulu.fi

Ludo – Theories of game and play Craft – Art of game design and development LudoCraft = The Art of Designing and Creating Games and Play



Information society is linked to the 3rdphase of industrial revolution – the ser-

vice industrial revolution. Digitalization, soft-ware, and networks are now in this centurythe underlying drivers. Increasing share ofGNP will be services produced, distributed,and consumed through networks.

ICT’s Main Role Is to Support ProcessesConsequently, industries turn from “ICT-simple”, to “ICT-complex”. In ICT-complexindustries, customers pay for products andservices based on software. The ICT valuepotential, while being not only process relatedbut directly product and service related aswell, is essentially infinite. ICT as an asset isabsolutely critical. A decisive bottleneck ofbusiness development is the managementcapability of ICT and agility. Core systemmodernizations represent the ultimate chal-lenge. Generic, horizontal ICT solutions areoften inadequate and insufficient. Verticallyorientated and customer intimate services areneeded.

The focus of TietoEnator’s vertical growthis on the ICT-complex industries with Nordicstrength, like telecom and banking.TietoEnator’s value proposition is based onincreasing sophistication of service conceptsand on vertical solutions. Joinsourcing, CoreApplication Modernization Partnership,Solution Partnership, and DigitalizationPartnership are examples of TietoEnator’sofferings.

Longer Value Chains and GlobalizationDigital value chains tend to become longer.ICT-complex businesses not only needsophisticated internal systems but servicessupporting end-to-end chains crossing com-pany borders. TietoEnator’s core system relat-ed services are complemented by those relat-ed to business process integration.TietoEnator’s Value Networks together withDigital Innovations provide advanced digital-ization offerings for these needs.

Service industrial revolution means alsoglobalization. Developing countries providegrowing abundance of high-quality ICT-skills.Improving global network infrastructureenables wide-spread utilization of these assets.This trend started predominantly as cost-reduction-driven. However, the great oppor-tunity is using the unlimited resources foragility – for solving the severe challenge ofICT-complex businesses. For this capability,one needs a fine tuned end-to-end ICT-valuechain with industrial process managementsystems and scale. TietoEnator proactivelydevelops this capability by building a networkof global competence centres, own andalliance based, in the Baltic countries, Czech,India, and Russia.

Integration Service Preferred Over Own InvestmentImprovement demands for cost, quality, deli-very times, and customer service requiretighter and more automated business processintegration. The business environment isdynamic, which sets special demands for theICT integration agility. This development hascreated the need for higher level infrastructureto support digitalization and changed process-es between the business partners. Organi-zations have an increasing interest to get B2Bintegration as a service, instead of investing intheir own infrastructures and competencies.

To connect and adapt business systems andlocal integration solutions between businesspartners, banks, and authorities TietoEnatorhas build B2B integration service offering.Value added network services for end-to-endbusiness process integration support e.g. sup-ply chain management, governmental infor-mation exchange, and invoice management.By one million B2B transactions per dayTietoEnator’s Value Networks unit is the lead-ing B2B integration service provider inEurope. Its local expertise in Germany,Sweden, and Finland is complemented by acompetence unit in Lithuania. ❙

Juhani Strömberg, Senior Vice President, Group Development and Jyrki Poteri, Vice President, Value Networks | TietoEnator

In the Cross Roads of Developmentfrom “ICT-simple” to “ICT-complex”

TietoEnator is one of the

leading architects in building

a more efficient information

society and the largest

IT services company

in the Nordic countries.

www.tietoenator.com

49

| publications|

The Committee for the Future of the Finnish Parliament

asked Dr. Pekka Himanen of the Helsinki Institute for

Information Technology to prepare a report that looks

at the global challenges of the information society and

suggests one alternative for meeting these challenges:

the model of the information society combined with the

welfare state.

The main ideas presented in the report apply univer-

sally: the global development of the information society

has reached a phase that requires new actions from us

all. In short, the idea of the information society can be

defined as a creative society that is based on interac-

tion. What is most important to the information society

is not new technology but a new way of doing things.

The review comes to the conclusion that the most

“What is most important to theinformation society is not newtechnology but a new way ofdoing things.”

The review by Dr. Himanen can be found at www.eduskunta.fi/efakta/vk/tuv/challenges_of_the_globalinformationsociety.pdf

Jyrki KatainenChairperson of theCommittee for theFuture, Member ofParliament

Pekka Himanen: Challenges of the Global Information Society

The Prime Minister’s Office launched the “Finland in

the Global Economy” -project at the initiative of Prime

Minister Matti Vanhanen in January 2004. The aim of

the project was to investigate the challenges and

opportunities of the ongoing transition in the global

economy on the Finnish economy. The final report,

“Finland’s Competence, Openness and Renewability”,

was submitted to Prime Minister in November 2004.

The final report presents a strategy for ensuring the

competitiveness of the Finnish work and production in

the face of increasing global competition. The strategy

and key proposals for action are based on high level of

competence, R&D and innovations. The key for Finland

to succeed in global competition is to focus on being an

economy and a society based on a high level of

Report on Finland in the Global Economy: Competence, Openness and Renewability

“The report presents a strategyfor ensuring the competitivenessof the Finnish work andproduction in the face ofincreasing global competition.”

Anne Brunila Chairperson of the steering group ofthe project, Director General of theMinistry of Finance The Report is available at http://www.government.fi/tiedostot/pdf/en/91776.pdf

critical aspect in the development of the information

society is the development of the deep-set structures of

society. The information society agenda is not the same

as an information network or Internet programme. The

development of technology will help only when it is

combined with changes in the underlying structures.

The report discusses the global trends behind the

need to change our society, and lists values which could

serve as the basis for the continued combination of the

welfare state and the information society. A successful

reform requires value-based management from politi-

cians.

Our hope is that the report can be used as a basis

for fruitful discussions concerning the building of a

future sustainable information society. ❙

expertise. Although Finland’s education and innovation

systems are world leaders in many respects, there are

shortcomings that must be tackled urgently to maintain

international competitiveness. Determined investments

in improving competence and in the functioning of the

innovation system will enable Finland to exploit the new

potential of large, rapidly emerging markets. Increasing

openness, well functioning product and labour markets

and above all the ability to transform and renew itself

are also crucial elements of the strategy.

In addition to the final report, the Prime Minister’s

Office published numerous background studies and a

summary report covering over 20 sector-specific

dialogues organised between social partners as an input

to the project. ❙

Finland 2015 programme of the Finnish National Fund

for Research and Development (Sitra) aimed to develop

the knowledge, skills and networks of decision-makers

in our society so that they can handle the challenges

facing Finland in the future. It is Sitra's vision that by

the year 2010 Finland will be one of the three most suc-

cessful countries in the world.

One of the six courses forming the Finland 2015 pro-

gramme was “Future Makers 2015” bringing together a

group of young people from different economic, social

and cultural backgrounds to find out how we see the

future of Finland and the Finnish people. Besides the

completed or ongoing university studies we had nothing

in common, except that we had been born after 1968.

We promoted the necessity of immigrants for

Finland. Finland needs immigrants for cultural diversity

Ulla HyttiResearch Manager in Small BusinessInstitute of Turku School of Economicsand Business Administration

that brings about creativity and dynamics. We identified

that the work of tomorrow will have totally different

meaning than the work yesterday as the ways to work

change dramatically. The aging population creates a

necessity to analyse the concept of welfare society

from a new perspective. We asked what kind of struc-

tures will best secure the provision of welfare services

in an efficient manner. We also identified the need to

prevent social exclusion and to increase ways for people

to take part in civil society. The role of the third sector

is pivotal in this sense.

Finally, we also acknowledged that Finland does not

exist in a vacuum but is part of the global systems and

hence issues like, the EU, globalisation, human rights,

fair world trade and environment are important also for

Finland and the Finnish people. ❙

“The programme aims todevelop the knowledge, skillsand networks of decision-makersin the Finnish society so thatthey can handle the challengesfacing Finland in the future.”

Best before 01012015

The publication is available in English at http://194.100.30.11/suomi2015/


PeoplePopulation: ■ 5.2 million, 17 inhabitants

per square kilometre ■ 67 % live in towns or urban

areas, 33 % in rural areas

Capital: ■ Helsinki (559,000), about

one million people live in theHelsinki metropolitan area

Other Cities & Population: ■ Espoo (224,000)■ Tampere (201,000)■ Vantaa (184,000)■ Turku (175,000) ■ Oulu (126,000).

Finland has a Sami (Lapp) population of 6,500.

LanguagesFinland has two officiallanguages: Finnish and Swedish. Finnish is spoken by 91,3 % andSwedish by 5,4 % of thepopulation. Sami (Lappish) isthe mother tongue of about1,700 people.

Religion85,6 % Lutheran about 1 % Orthodox

Local Time+2 hrs GMT

Governance & LegislatureThe Head of State is thePresident of the Republic. ThePresident is elected for a six-year term by direct popularvote. Since March 1, 2000, thePresident is Tarja Halonen.

The Council of State is theGovernment. The new coalitiongovernment formed in June2003, is headed by PrimeMinister Matti Vanhanen (Centre Party). The governmentconsists of the Centre Party, the Social Democratic Party andthe Swedish People’s Party.

Finland has a unicameralParliament with 200 members.The members are elected for a four-year term by directpopular vote under a system of proportional representation.The president is empowered to dissolve the Parliament.

Finland in the InternationalCommunityMember of EU, UN, OECD andWTO, among others.

Economy■ GDP (2003 estim.):

143,3 billion euros ■ GDP per capita (2003 estim.)

27,496 euros

Foreign trade (2004): ■ Imports 40,27 billion euros■ Exports 48,79 billion euros

Major Exports:Electronic and electricalproducts, pulp and paper,machinery and equipment,metal products, transportvehicles, timber and wood,chemicals.

Foreign Investments ■ from Finland (2003 estim.):

54,4 billion euros ■ to Finland (2003 estim.):

36,7 billion euros

Unemployment rate (Jan. 2005): 9,8 %

Education ■ Population with educational

qualification (upper secondaryschools, vocational schoolsand colleges, polytechnics oruniversities): 61,9 %

Female entrants and degrees in Higher Education: ■ Entrants 55,9 % ■ Master’s degree holders 59,9 % ■ Doctor’s degree holders 46,5 %

Broadband connections(Dec. 2004): ■ in use in 30 %

of the households ■ available to 94 %

of the households

Geography■ seventh largest country

in Europe ■ 338,000 square kilometres,

of which 10 % is water and 69 % forest

■ 187,888 lakes, 5,100 rapidsand 179,584 islands

■ Europe’s largest archipelago,including the semi-autonomous province of Åland

Distances■ 1,160 km north to south,

540 km west to east ■ Finland’s land border with

Russia (1,269 km) is theeastern border of theEuropean Union

■ Neighbouring countries:Sweden, Norway, Russia,Estonia

Climate The climate of Finland ismarked by cold winters andfairly warm summers. In the far north of the country the sundoes not set for about 73 days,producing the white nights of summer. In winter the sunremains below the horizon for 51 days in the far north.

In summer the temperaturequite often rises to +20 Celsiusor more and occasionally goesclose to +30 in southern andeastern parts of the country. In winter, temperatures of -20Celsius are not uncommon inmany areas. Finnish Laplandinvariably has the lowest wintertemperatures. The meantemperature in Helsinki in July is +17 Celsius and in February -5.7 Celsius.

Finland in Brief

Pho

to: F

utur

eim

ageb

ank

Sources: Statistics Finland, Finnfacts,Virtual Finland, Ministry of Transport andCommunications, Finnish Customs

51

TIEKE Finnish Information Society Development Centre has a key networking role as a neutral and non-profit organization in promoting theefforts of its members, within the public and private sectors alike, with an ultimategoal to create viable tools and expertise for the use of information society.

TIEKE Finnish Information Society Development Centre has initiated and runs anopen network of various players operating in information technology industry. Theoperations of ICT Cluster focus on projects and services covering current topics. Asof today, the members of ICT Cluster represent a variety of business enterprises,universities, technology centres, and industry associations, assuming their roleeither as suppliers or users.

PERTTI Database Service for ICT Cluster Networking PERTTI is a database service operating since 1994 for Finnish companies tointroduce their expertise to potential partners, both domestic and foreign. Thedatabase includes contact information for over 150 Finnish partners. PERTTI allowssearches for information as well as transmission of calls for bid and co-operation. The service is free of charge.

Welcome to the Meeting Point for Information Society Developers

A Window to Finnish

Information Society

Search PERTTI Database using Keywordshttp://palvelut.tieke.fi/pertti/search.eng.shtml

Search PERTTI Database using IT Classificationhttp://palvelut.tieke.fi/pertti/search.eng.tlx.shtml

e.finland.fi offers its visitors accurate and up-to-dateinformation on Finnish ICT know-how and FinnishInformation Society functions and solutions in a nutshell,introducing Finland as what it has rapidly become a country where Information Society of tomorrow is areality today.

The daily updated site offers information in the form oftimely expert articles, statistics, and fresh news on a widerange of Information Society related topics under the mainheadings of eBusiness, eGovernment, eEducation &eCulture, Mobility, and Research & Development.

Joint Venture in Wide Cooperation e.finland.fi is built and maintained in wide cooperation withseveral ministries and national promoters of informationsociety. The basic idea of the site is to provide allinterested parties a single site offering a concentration ofFinland’s information society activities, thus eliminatingthe need to search for information from several sources.

http://e.finland.fi A Window to Finnish Information Society

Partners:

Ministry for Foreign Affairs http://www.formin.fi

Ministry of Financehttp://www.vm.fi

Ministry of Transport and Communications http://www.mintc.fi

National Technology Agency Tekes http://www.tekes.fi

TIEKE Finnish Information Society Development Centrehttp://www.tieke.fi

The site brings you to Finland,

the technological heartland of

Northern Europe.

For additional information contact Editor-in-Chief Helena Roine-Taylor, TIEKE tel. +358-9-4763 0312 [email protected]

|introduction| ICT – Essential Tool for the Future |overview| Finland – An ICT-DrivFinnish ICT Development from the OECD Perspective. |column| Why the Finns AOther Countries Learn from the Finnish Experience? Know-How – The Best ReInformation Security. Enforcing the Security of Information in Finland |telecomin the Power of Locality. Elcoteq Establishing a Global Footprint |research andPractices and Innovations. How to Get on the Top of PISA Tower... and other enigHigh from the Very Beginning |regions| Access to the Internet – A Matter of EquSite. eTampere Builds the Well-being of the Future. “eInvoicing LivingLabs” to Highly Efficient Business Environment |products and services| Finnish WellbeinEllibs – Europe’s Leading eBooks Provider. Northern Cultural Heritage Meets Higsimple” to “ICT-complex” |publications| Pekka Himanen: Challenges of the GlobOpenness and Renewability. Best before 01012015. Finland in Brief. eFinla

T I E K E Finnish Information Society Development Centre

ict cluster finland - urenio.org · 2 ict cluster finland review during the past decade, finland...

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