Archive

Editorial:

The Nordic and Baltic Journal of Information and Communication Technologies   (NB!ict) is an offspring of NordICT – a collaborative network of universities and private ICT companies in the Nordic and Baltic Sea region. The primary goals of NB!ict are twofold: to provide a platform for debate on ICT developments; and to present scientific work from or about the region.

NB!ict is an interdisciplinary journal focusing on interrelationships between technology developments in the ICT field and economic, political and other social developments. Published papers will be concerned with technology in context of economic, political and other social developments as well as implications of ICTs for broader societal developments. Analysis will consider both demand-side and supply-side issues of ICT hardware, software, applications, services and content.

The question of whether the Nordic and Baltic Sea region constitutes a unity of any kind, hence justifying a Nordic and Baltic journal, can be answered in terms of the tradition for Nordic cooperation in a large number of areas – partly based on language, partly based on geographic proximity. Moreover, close ties are maintained between the Nordic countries and countries around the Baltic Sea. These include the five Nordic countries, Finland, Sweden, Norway, Denmark and Iceland; the three self-governing areas of Greenland, the Faroe Islands and Åland; and the three Baltic States, Estonia, Latvia and Lithuania. There is also proximity with Germany, Poland and Russia, including Kaliningrad. NB!ict undertakes the role of increasing awareness and understanding around developments in the Nordic and Baltic Sea region within a broader international perspective.

Despite significant national differences, a common trait of most Nordic and Baltic Sea countries is their relatively small size. This creates a common basis for the need to be open to the outside world, especially neighbouring countries and those close by. The common features of these countries relating to ICT developments will be addressed within the themes of this journal. Equally important are the differences. The level of unity within the region is determined by similarities as well as complementary differences between countries. NB!ict seeks to reflect these similarities and complementarities but also has the aim of working to strengthen ties by exchanges of information and debates.

Although primarily concerned with issues pertaining to the Nordic and Baltic Sea region, NB!ict will also consider papers that only indirectly relate to Nordic and Baltic Sea developments for publication. Authors from outside the Nordic and Baltic Sea region are encouraged to submit their work and we also hope to develop our readership outside this region.

Two main types of papers and articles are featured in the NB!ict journal. The first are academic papers (theoretical, empirical and analytical), the second are journalistic articles, interviews, reviews, etc. The intention is to reach beyond an academic only audience to attract also readers from industry and from policymaking and regulatory institutions. The vision for NB!ict is to establish a platform for cross-fertilisation across the different sectors. This will be achieved by exploring similarities and complementarities between the Nordic and Baltic Sea countries, and further through examining synergies between the different communities from academia, industry and policy and regulatory institutions.

Papers submitted to the academic portion of the journal will be double-blind peer-reviewed in the traditional academic manner. Journalistic articles, interviews, reviews, etc., submitted by the editors, free-lance journalists, private sector stakeholders, members of NGOs, etc., will not be peer-reviewed, but will be subject to editorial review.

NB!ict is independent of all interests, economic or otherwise, and accepts no interference in its editorial work. The aim is to establish a critical journal that not only features the positive aspects of ICT developments in the Nordic and Baltic Sea region, but also tackles critical questions and issues. NB!ict intends to create a platform for a critical debate on issues concerned with ICT developments and their implications for the Nordic and Baltic Sea region.

The main theme of the current issue, mobile and wireless communication, is examined from different perspectives in five of the papers presented here, while two other pieces deal with the takeover of the Danish telecom incumbent, TDC, by private equity groups. Ramjee Prasad and Knud Erik Skouby’s paper entitled ‘Beyond 3G Research: Can the Nordic and Baltic Countries (Re)Emerge Among the World Leaders?’, examines the future of mobile and wireless communication in the Nordic and Baltic region. The paper’s point of departure is the rich legacy of the Nordic countries in the mobile field. It discusses the position of the Nordic and Baltic Sea region in the global environment and concludes that the Nordic and Baltic area could be a driver in advanced mobile and wireless systems. The authors focus specifically on cooperation between industry and universities and report on the cooperation between two university research centres in the field of mobile and wireless communications and their collaboration with industry.

Heikki Hämmäinen’s contribution, ‘Finland Counting on DVB-H’, examines the implementation of mobile TV in Finland using the DVB-H standard. Hämmäinen discusses important questions which must be considered when implementing mobile TV, including spectrum license policy and copyright issues. Finland is among the first countries to go beyond trials in the mobile TV field and the experiences drawn will be valuable to other countries.

A third shorter piece on mobile and wireless communications is a review of ‘Competition and Regulation in the Nordic Mobile Markets’, a report written by the Nordic telecommunication National Regulatory Agencies (NRAs). The report and the review focus on the similarities and the differences among the national mobile markets in the Nordic region. In addition to retail markets, there is special emphasis on two wholesale markets: access to mobile networks and mobile termination. The review, furthermore, discusses issues which are missing in the report – first and foremost of these is the question whether there is, or rather should be, a common Nordic telecommunication market.

The section of short pieces concludes with an interview with Poul Nyrup Rasmussen, former Prime Minister of Denmark and current member of the European Parliament and President of the Party of European Socialists. Poul Nyrup Rasmussen has taken a special interest in the activities of private equity groups (PEGs) on a European scale and has specifically given attention to the case of TDC, the incumbent telecommunication operator in Denmark. Poul Nyrup Rasmussen is concerned that PEGs risk weakening long-term industrial development for the sake of short-term financial gains of PEGs. Furthermore, and in addition to issues regarding tax payments and the situation of pension funds, he sees a threat to social coherence in the manner in which some PEGs operate.

The first of the academic papers, written by William H. Melody, is about ‘The Private Equity Takeover of Telecom Infrastructure in Denmark: Implications for Network Development and Public Policy’. The paper is a critical analysis of TDC’s takeover by a private equity group, which took place in February 2006. Melody documents that significant funds have been taken out of TDC and that the debt level of the company has risen dramatically. The concern is that this will undermine TDC’s central role in developing information society infrastructure.

Considering Melody’s critical stance vis-à-vis monopoly or quasi-monopoly incumbent operators, during his long career of matters concerned with telecom regulation, one might view TDC’s current situation as an opportunity to get new operators into the market and have more evenly distributed market shares for the different operators in the Danish market. While this may well happen, it will not compensate for the lack of network development on the part of TDC. The end result will be that development of new advanced network facilities and services will be stalled to the detriment of users.

The reasons for TDC’s takeover by a PEG are examined in the paper and a comparison with the Norwegian-based Telenor is undertaken for this end. PEGs have shown increasing interest in telecom operators, and the specific reasons for a PEG to buy TDC is shown to be the result of a combination of factors – among them the interest of the management of the company to cooperate with the PEG. However, the predominant reason is that the company’s financial structure is susceptible to activities for cashing out the values of the company. This could be interpreted as evidence of an inefficient financial structure warranting PEGs’ intervention to optimise the finances of the company. However, there are not only two equilibria: an inefficient structure and an efficient structure. There are multiple equilibria, one of these being that a company, which might be optimised financially, is drained and sold off in a poorer state than before the takeover.

A second academic paper written by Alberto Di Minin and Christopher Palmberg entitled, ‘A Case for Non-Globalisation? Strategic R&D in Wireless Telecommunications’, is concerned with an issue that is central to the NB!ict, of whether geographical proximity plays a role in industrial development in an increasingly globalised economy. The paper opens by referring to the growing globalisation of manufacturing and asks whether this applies, to the same extent, to research & development (R&D). The authors consider the case of the wireless telecommunication industry, for which the notified essential patents of four leading incumbents in the field (Ericsson, Nokia, Motorola and Qualcomm) are analysed to assess the extent to which and how R&D and inventive activity is globalising.

Tentatively, the paper concludes that the case of the wireless telecommunication industry supports a non-globalisation thesis and that modifications should be made to sweeping generalisations concerning the internationalisation of R&D. The authors do not claim that their conclusions necessarily apply to all industrial sectors. These must be examined in further research. However, the case points to interesting issues regarding localisation advantages and to the interactions between the management of intellectual property (IPR) and the R&D functions of firms. Both of these issues suggest a strain on the globalisation of R&D activities.

The third and final academic paper in this issue deals with another perspective on geographic proximity in a contribution by Per Högselius entitled, ‘The Nordic Shaping of Innovation in Estonia: Case Studies from Mobile Communications and E-Government’. The paper adopts a systems of innovation approach to discuss different factors in the interrelationships between Estonia, Finland and Sweden, which may have had bearing on the development of the Estonian systems of innovation. The overall conclusion is that “Nordic-Baltic interaction … underpins in a powerful way the build-up of innovative opportunities and a creative innovation environment in Estonia, although it is only very rarely directly visible in the form of cross-border joint innovation projects.”

The paper is concerned with such interactions around the beginning of the century. Shortly after the downfall of the Soviet Union in 1991, Estonian decision-makers had already started promoting the use of electronic communication for social development. Today, Estonia is one of the world’s most advanced countries with respect to e-government and e-banking. The paper’s claim is not that this is due to the country’s Nordic connection, but it seeks to examine the different ways in which the Nordic-Estonian interaction contributed to the development of mobile communication and e-government in Estonia.

Each issue of NB!ict will be organised around a central theme, in the same way as the current issue focuses on mobile and wireless communications. However, we also welcome contributions outside the main theme for both academic papers as well as shorter journalistic pieces. We also welcome reactions to already published papers. We aim to expand ownership of the journal as much as possible among contributors and readers from universities as well as companies, ministries, and public agencies.

Anders Henten
Editor