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Moving out of Nokia's shadow

Finnish entrepreneurs seek to replicate cell phone company's international success.
/ Source: a href="http://www.washingtonpost.com/wp-srv/front.htm" linktype="External" resizable="true" status="true" scrollbars="true">The Washington Post</a

What does a little country with good technical skills and a lot of imagination try to sell to a fast-changing global economy already crowded with entrepreneurial ideas from much bigger economies?

Finland's first answer for a decade has been cell phones, thanks to Nokia Corp., one of the world's most innovative and successful companies. Nokia is by far the biggest company in Finland; it has built a handsome new research center by the side of a beautiful lake here and many more installations around the country.

Nokia's success has made Finland one of the fastest-growing and most prosperous economies in Europe. But Finns are understandably nervous about depending on a company that is so vulnerable to fads and competition. Nokia's fortunes declined last year largely because it missed the fashion for "clam shell" cell phones that flip open. The firm bounced back in the first quarter of 2005.

Numerous Finnish entrepreneurs are trying to launch their own little Nokias. Several provincial cities are trying to foster high-tech enterprises, and Jyvaskyla, 180 miles north of Helsinki, is one of the most active. A long day of interviews here organized by Jussi Nukari, director of information technology at the Jyvaskyla Science Park, introduced an array of Finnish technologies.

Among them:

Liqum is a firm created by Sakari Laitinen, 40, an engineer who invented a technology to detect impurities or inconsistencies in all kinds of liquids and slurries. The technology is based on "artificial sniffing," Laitinen explained -- a means of detecting changes in a flow of something as simple as water or as complex as the goo of wood pulp, water and chemicals that becomes paper in a modern paper machine.

Laitinen's first market was the Finnish paper industry, still a critical part of the country's economy. But the patents he has in the United States and elsewhere for devices that can monitor liquid flows will, he said, also detect foreign agents -- such as cyanide -- in a big city's water supply. He is hoping that the homeland security market in the United States will be interested.

MetaCase, a software engineering company, had sales of more than $1.25 million last year but dreams of much bigger business in the future. Chief executive Juha-Pekka Tolvanen, 37, excitedly explains that Microsoft Corp.'s Bill Gates has said the realm in which MetaCase is working is the key to the next decade of computing.

This is symbolic programming, or the use of visual symbols to organize computer code to achieve new technologies and capabilities. MetaCase's slogan, Tolvanen said, is "Don't outsource, automate!"

Nokia is already using MetaCase's tool, called a code generator, to design new telephones, a huge task for a company that needs to launch about 40 new models a year to stay competitive. He thinks it can be used by nearly everyone writing programming code.

"Software engineers have always tried to automate the work of others," he said, "but they're not so good at drinking their own medicine. They think they are artists, but they're really engineers. We say we can make software-writing 10 times faster" than doing it one line at a time. He's proud that the world is noticing their work; he has been invited to appear on an international panel this summer with a senior Microsoft executive.

MetaCase was founded by seven PhDs from Jyvaskyla University, with the backing of the university's rector. A state organization called Tekes that funds basic and applied research put up a couple of hundred thousand Euros a decade ago to get the idea launched.

Innosonic is producing tools to help content owners -- entertainment companies, travel guide publishers, newspapers and magazines -- earn additional income by repackaging their material and distributing it to cell phones. To illustrate, the firm's managing director, Jouko Tossavainen, showed off an animated ring tone featuring a snippet of an original Mickey Mouse cartoon. He is trying to interest Walt Disney Co. in the idea.

Another tool is called Traveler. It allows a customer to receive, by cell phone, information on stores and restaurants in a city or neighborhood. Tossavainen demonstrated by summoning a list of Italian restaurants in Washington to his new Nokia, which combines a computer, a screen and a phone. (The newest models also play music, like an iPod.) Finnair has bought this to provide for the airline's customers.

A third application is a "pocket language lab," software that helps teach you a language using your phone. It allows, for example, for the user to compare her pronunciation of "Champs Elysees" with that of a native French-speaker. Tossavainen is hoping to sell this to firms like the German company that owns world rights to the Berlitz name.

Tekes also provided seed money for Innosonic -- 100,000 euros. He was able to apply for this grant online. After meeting with just one official from this state committee, they had the money, in the form of a private equity loan. "Our next money will come from our customers," Tossavainen said confidently.

Sofia Digital is trying to exploit SMSTV, the message-sending technology used by the American Idol television program, for new purposes. One, according to Janne Huovilainen, 35, a manager of the firm, is a technology that allows customers to play electronic games with others on broadcast television, using the new channels created by the digitization of broadcast signals.

Sofia Digital acquired a Finnish maker of electronic games last year. It is backed by a small Finnish venture capital firm (there aren't many of them) and had sales of 1.4 million euros last year, 40 percent of them outside Finland.

Emfit Ltd. makes a material that converts pressure from a touch or footstep into an electrical signal. The company is principally owned by a former stockbroker named Heikki Raisanen, one of the few Finnish entrepreneurs interviewed here who made no bones about his desire to get rich (something many Finns consider slightly irregular, if not improper). "I want to do an IPO," he said -- an initial public offering of stock in one of his entrepreneurial companies.

He is developing paper-thin keypads from this material, as well as a device to alert a nurse or relation if a patient they are monitoring gets out of bed. A step on an Emfit pad under a rug next to the bed can ring an alarm. It's most useful for keeping track of elderly patients with dementia, he said.

Nukari of the Jyvaskyla Science Park noted repeatedly that Finland represents "just five-tenths of a percent of the global market." Its population, 5.2 million, is smaller than that of metropolitan Washington D.C. (nearly 6 million). But marketing and selling to the rest of the world does not come naturally to Finns. "We are a more technically oriented people," said Tossavainen of Innosonic. Finns like to invent things without asking, "How can we make money from that?" he added. To prove the point, he pulled out his cell phone again to show off a screen that looked, as he quickly acknowledged, like the old-fashioned snow globe, a crystal ball filled with artificial snowflakes that a child can activate by shaking it. What's the commercial use of that?

Nukari has recruited an American business coach named Sharon Ballard, a veteran of Motorola and several start-ups who has visited here several times to help Jyvaskyla's entrepreneurs think of themselves as salesmen to a wider world. Jyvaskyla's business incubator is producing 10 to 15 new companies a year, he added. "This is the second-fastest-growing region in the country, after Helsinki."