The leaders of the five Nordic countries of Denmark, Finland, Iceland, Norway and Sweden have signed a letter of intent to accelerate the development of fifth-generation mobile systems. The move aims to support these countries' efforts to be among the world's front runners in the roll-out of 5G wireless services. The announcement was made at an annual summit of the regional leaders that was hosted by Swedish prime minister Stefan Lofven.
The agreement involves the backing of governments and many of the leading telecoms companies operating in the region, including infrastructure suppliers Ericsson and Nokia and mobile operators Telenor, Telia, TDC, Tele2, Iceland Telecom and Vodafone Iceland.
There's certainly a track record here that shows how collaboration in the wireless industry can work to support technical prowess and create high-paying technology jobs. The Nordic countries were among the first in the world to recognize opportunities in the broad deployment of wireless services. In the early 1980s, regional players developed the Nordic Mobile Telephone system, an analogue network that quickly became the most widely-adopted mobile service in the world, popular with enterprise users as well as consumers. Mobility became mainstream.
The success of that system, in terms of both the technology and collaborative efforts to create it, was one of the springboards that led to the development of the GSM standards with the European Telecommunications Standards Institute. Sweden's Ericsson and Finland's Nokia were major participants in that European endeavor and those two companies still hold many of the GSM essential patents.
Although the Nordic region was instrumental in the development and democratization of first- and second-generation mobile services, there's been a dilution of technology leadership during the past decade. Companies from the US and South Korea began to dominate the market for handsets and the mobile ecosystem, and Chinese infrastructure makers eroded the leading positions of Ericsson and Nokia.
Concern that the Nordics — in fact, Europe in general — could be left behind in the early stages of 5G are certainly valid and worth addressing. We've written about what we've called the "European mobile crisis" several times (see, for example, European Mobile Crisis Deepens). Many jobs in the wireless sector were lost to other regions, though much of the talent was successfully redistributed. If Europe is to make up ground on other regions in the race toward 5G, initiatives like the new Nordic action plan will need to be just the start. Europe continues to be hampered by market fragmentation, lack of scale and burdensome regulation. Given the huge costs associated with deploying 5G, it may be that infrastructure and network sharing proves the only way for operators to make the economics add up.
The project is an acknowledgement of the largeness of 5G. Its aim is for the technology to be a major part of a country's infrastructure enabling new industries and services beyond communications. The agreement between the five countries includes the technical coordination of 5G frequency bands throughout the region, and removing obstacles to 5G expansion and development of new testing facilities. Progress will be closely monitored by the Nordic Council of Ministers.
It should be noted that the combined population of the five Nordic countries is only about 27 million. Much larger nations around the world are also working to take pole position in 5G. In Asia, the government of South Korea is hoping to avoid the existence of several separate 5G networks with patchwork coverage by mandating that the three mobile operators SK Telecom, KT and LG Uplus and internet service provider SK Broadband work together on a single nationwide 5G network.
In the US, T-Mobile and Sprint are using the importance of a fast and successful 5G roll-out as a main justification to win approval for a merger of the two carriers. They might be telling regulators what they want to hear, but there's certainly some validity to the argument.
In many instances, 5G will be a group effort. We expect more cooperative projects to be announced as challenges arise.
Raghu Gopal has more than 20 years' research and operational experience
This article originally appeared onCCS Insight