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Diversification in response to ICT convergence – indigenous capabilities versus R&D alliances of the Finnish telecom industry

Christopher Palmberg (Researcher at the Research Institute of the Finnish Economy. His recent work focuses on the evolution and future challenges of the ICT industry, and the position of Finland in the new global division of R&D, and nanotechnology. He holds a PhD degree at the Royal Institute of Technology, Department of Industrial Organisation and Management in Sweden.)
Olli Martikainen (Professor at the University of Oulu, Associate Research Fellow at the Research Institute of the Finnish Economy, Docent at Helsinki University of Technology and Lappeenranta University of Technology. He is also member of the Finnish Academy of Technology, the Board of TietoEnator Oy and Siemens Finland. He holds a PhD at Helsinki University and an MSc at the Helsinki University of Technology.)

info

ISSN: 1463-6697

Article publication date: 1 July 2006

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Abstract

Purpose

While the ICT industry as a whole is undergoing a potentially disruptive phase of development due to the convergence between information and telecom technologies and the rapid diffusion of internet‐related applications. Against this background the purpose of the paper is to analyse recent patterns of internal/indigenous and external diversification of prominent Finnish telecom firms using data on patents and strategic R&D alliances.

Design/methodology/approach

The methodology comprises of statistical analyses of patterns of patenting of Finnish telecom firms to capture the internal/indigenous nature of diversification, compared with patterns of external diversification based on a new database of alliances of Finnish firms.

Findings

The results indicate that the Finnish telecom industry has diversified its technological base in recent years. The industry appears internally/indigenously weak in internet‐related “new” telecom technologies and related applications. However, telecom firms have also extensively engaged themselves in complementary R&D alliances in these fields.

Research limitations/implications

The paper carries important implications for policymakers and managers alike related to the sustainability of previous success of Finnish telecom. Limitation related to the use of Finnish patent data that might to capture software technologies sufficiently, and does not aim to/cannot capture the diversified technological competencies of Nokia on a global level.

Originality/value

The originality of the paper lies in the combination of patent and R&D alliances data, as well as the development of a concordance table to link technology classes to broader developments in the industry, for a novel and systematic analysis of the responsiveness of the Finnish telecom industry to ICT convergence

Keywords

Citation

Palmberg, C. and Martikainen, O. (2006), "Diversification in response to ICT convergence – indigenous capabilities versus R&D alliances of the Finnish telecom industry", info, Vol. 8 No. 4, pp. 67-84. https://doi.org/10.1108/14636690610676559

Publisher

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Emerald Group Publishing Limited

Copyright © 2006, Emerald Group Publishing Limited

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