Strong signals

When it comes to technology, Sweden has always been at the cutting edge: from changing the face of mobile telephony with NMT (Nordic Mobile Telephony) to becoming the first country to deregulateits telecom sector in the early 90s.

This year, Sweden has once again topped the rankings of the Global Information Technology Report 2009-2010, the ninth consecutive year that it has retained the position. The report, issued by the World Economic Forum, is a testimony to the fact that Sweden's policy to build a "sustainable information society for all" has borne fruit. Today, it can boast oneof the world's most modern IT infrastructure and services, with 89 per cent of the Swedish population enjoying access to the internet as of 2009.

A number of factors have helped Sweden gain an edge as a technology leader. As Åsa Torstensson, Swedish Minister of Communications, explains,it is the high level of education, an overall interest in new technologies and good access to broadband that have spurred the rapid growth of IT and the telecom sector in the country. It enjoys one of the highest proportions of broadband subscriptions through fibre and wireless networks in Europe and is also one of the few countries worldwide to have had a broadband policy since the late 1990s.

Encouraging competition

Despite the success of the sector, the Swedish government has always strived to come up with policies and strategies to fuel further development, Torstensson says. For instance, in November 2009, Sweden presented a broadband strategy that is geared to meet emerging challenges, such as increased globalisation, climate change, an ageing population in a scarcely populated country, and ways to improve competition and conditions formarket players.

With such rapid technological advances comes the need to ensure their best utilisation through modernising regulations and raising public awareness. In March,for instance, the government presenteda bill to the Riksdag, the national legislative assembly of Sweden, containing proposals on more appropriate rules for licensing radio transmitters. The bill was the resultof the government's efforts to keep pace with the demands of the future and promote access to electronic communication services for consumersand businesses, says Torstensson.

"A high-priority issue for thegovernment is the implementation of the telecoms package in Swedish legislation, which is an overhaul of EU rules underlying the national provisions in the area, principally the Electronic Communications Act. The new ruleswill strengthen competition andconsumer protection in Europe. Competition that works better leads to lower prices and better services. The new rules additionally reduce uncertaintyin businesses, so that it becomes easierto make investments," she adds.

The information communication technology (ICT) sector is among the critical drivers of growth in Sweden's economy. In addition to employing a large section of its labour force in the sectoror in allied fields, the ICT industry � catalyses growth in other key industries such as automobiles, pharmaceuticals and engineering.

To consolidate gains in the sector, the government has consistently invested in research and development, says Torstensson. The government also presented a bill on research and innovation in 2009, aiming to position the country as a research nation and increase its scientific competitiveness.

"The government has allocated 195 million krona (about Dh91.25 million) in IT, mobile communication and e-science, which roughly equals a third of the technology sector's total allocation of 610 million krona," says Torstensson.

Attracting investors

Since the beginning of the dotcom boom, venture capitals (VC) have traditionally promoted growth in the ICT sector, and it is no different in Sweden. The country has always been successful in attracting venture capital investments, and after the recent economic challenges the green shoots of recovery are once again visible in the sector. Torstensson hopes as global markets become increasingly normalised, ICT sectorsin Sweden will continue to occupy pride of place for investors.

Figures from 2008 released by the Swedish Venture Capital Association (SVCA), would reinforce Torstensson's hope. According to the data, 44 per cent of the total early stage VC investments in Sweden were placed in the ICT sector, while the ICT sector's share of buyouts was lower at 16 per cent. Investments in the ICT sector also increased between 2007 and 2008, from 36 per cent to 44 per cent, on the total number of investments and from 26 per cent to 46 per cent on the total amount invested.

Good reputation

Riding on the success of Sweden's leading position in the ICT sector, a number of Swedish technology firms are doing brisk business in the UAE. "Sweden's reputation contributes a lot to our success inthe Middle East by being perceived as a reliable and trustworthy company. This is emphasised by our quality products and successful installations around the Middle East," says Baraa Al Akkad, Regional Manager of Axis Communications Middle East, an IT company that offers networked video solutions for professional installations.

Lennart Broman, CEO of Swedtel, a Swedish telecom company with a strong foothold in the Middle East, agrees. "At Swedtel, for instance,we mostly employ ICT experts from Sweden and deploy them in other parts of the world. Besides the knowledge they share among themselves, they can also learn from other markets and can apply those things when they return to Sweden."

However, the Swedish ICT sector is not without its challenges. As Torstensson says, there is an urgent need for investments in new infrastructure and technology to meet market demands. She also raises the issue of the digital divide in a country where investments are mostly channelled in densely populated areas, while it is a real challenge to generate investments for remote parts where conditions are less favourable for the deployment of infrastructure.

As Sweden's ceaseless efforts continueto consolidate its position as a global technology leader, its strategy so far has paid off and ensured its reputation as one of the most sophisticated and advanced nationsin terms of ICT.