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VINNOVA ANALYSIS V A 2 0 0 4 : 0 4 TELECOM DYNAMICS History and State of the Swedish Telecom Sector and its Innovation System 1970 - 2003 Final Report SVEN LINDMARK, ERIK ANDERSSON, MATTIAS JOHANSSON & ERIK BOHLIN Titel/Title: Telecom Dynamics. History and state of the Swedish telecom sector and its innovation system 1970 - 2003. Final report Författare /Author: Sven Lindmark, Erik Andersson, Mattias Johansson & Erik Bohlin - Chalmers Serie/Series: VINNOVA Analysis VA 2004:04 ISBN: 91-85084-13-1 ISSN: 1651-355X Utgiven/ Published: July 2004 Utgivare/Publisher: VINNOVA - Verket för Innovatonssystem /Swedish Agency for Innovation Systems VINNOVA Diarienr/ Case No: 2003-01320 Om/About VINNOVA VINNOVAs uppgift är att främja hållbar tillväxt genom utveckling av effektiva innovationssystem och finansiering avbehovsmotiverad forskning. Genom sitt arbete ska VINNOVA tydligt bidra till att Sverige utvecklas till ett ledande tillväxtland. I serien VINNOVA Analys publiceras studier, analyser, utred- ningar och utvärderingar som tagits fram inom eller på uppdrag av VINNOVAs avdelning för Innovationssystemanalys. Forskning och innovation för hållbar tillväxt. VINNOVA´s mission is to promote sustainable growth by developing effective innovation systems and funding problem-oriented research. I VINNOVAs publikationsserier redovisar bland andra forskare, utredare och analytiker sina projekt. Publiceringen innebär inte att VINNOVA tar ställning till framförda åsikter, slutsatser och resultat. Undantag är publikationsserien VINNOVA Policy som återger VINNOVAs synpunkter och ställningstaganden. VINNOVAs publikationer finns att beställa, läsa eller ladda ner via www.VINNOVA.se. Tryckta utgåvor av VINNOVA Analys, Forum och Rapport säljs via Fritzes Offentliga Publikationer, www.fritzes.se, tel 08-690 91 90, fax 08-690 91 91 eller [email protected] VINNOVA´s publications are published at www.VINNOVA.se Telecom Dynamics History and state of the Swedish telecom sector and its innovation system 1970-2003 T2 – Tillväxt i Telekom Analys av telekomsektorns innovationssystem 1970-2003 (Swedish title) FINAL REPORT May 2004 Sven Lindmark, Erik Andersson, Mattias Johansson, Erik Bohlin Chalmers University of Technology Department of Innovation Engineering and Management SE 412 96 Göteborg, Sweden Tel: +46 31 772 3484 Fax: +46 31 772 1917 Email: [email protected] CONTENTS 1 INTRODUCTION .......................................................................................................................................... 1 1.1 BACKGROUND.......................................................................................................................................... 1 1.2 PURPOSE .................................................................................................................................................. 2 1.3 PROJECT EXECUTION................................................................................................................................2 1.4 METHODOLOGICAL CONSIDERATIONS AND DELIMITATIONS ................................................................... 3 1.5 OVERVIEW OF REPORT ............................................................................................................................ 4 2 INNOVATION SYSTEMS............................................................................................................................ 6 2.1 THE DEVELOPMENT OF INNOVATION THEORY ......................................................................................... 6 2.2 INNOVATION SYSTEMS – CONCEPTS AND DEFINITIONS........................................................................... 7 2.3 DISCUSSION OF SYSTEMS OF INNOVATION LITERATURE ....................................................................... 19 2.4 THE INNOVATION-SYSTEM APPROACH PROPOSED HERE........................................................................ 24 2.5 SUMMARY.............................................................................................................................................. 28 3 EVOLUTION OF TELECOMMUNICATIONS...................................................................................... 31 3.1 INTRODUCTION TO TELECOMMUNICATIONS .......................................................................................... 31 3.2 TELECOM PRE-1970S ............................................................................................................................. 39 3.3 POINT OF DEPARTURE (1970)................................................................................................................. 47 3.4 MAIN TRENDS ........................................................................................................................................ 53 3.5 THE BUST AND BEYOND (2000 -) ........................................................................................................... 92 3.6 SUMMARY AND CONCLUSIONS .............................................................................................................. 95 4 EVOLUTION OF THE SWEDISH TELECOM SECTOR .................................................................. 100 4.1 IMPORTANCE FOR THE SWEDISH ECONOMY AND INNOVATION SYSTEM.............................................. 100 4.2 EVOLUTION OF THE SWEDISH TELECOM SERVICES MARKET ............................................................... 108 4.3 ERICSSON AND THE SUPPLIER INDUSTRY............................................................................................. 130 4.4 THE SWEDISH TELECOM SECTOR IN THE EARLY 2000S ....................................................................... 140 4.5 COLLABORATION ERICSSON-TELEVERKET AND THE ROLE OF PUBLIC PROCUREMENT....................... 142 4.6 EDUCATION – SOME OBSERVATIONS ................................................................................................... 144 4.7 TELECOM-RELATED RESEARCH AND DEVELOPMENT........................................................................... 146 4.8 ACCESS TO CAPITAL/INVESTMENTS..................................................................................................... 153 4.9 SUMMARY AND DISCUSSION ................................................................................................................ 158 5 EVOLUTION OF FIBER OPTICAL COMMUNICATIONS.............................................................. 162 5.1 THE INTERNATIONAL SCENE ................................................................................................................ 162 5.2 THE EVOLUTION OF SWEDISH OPTICAL COMMUNICATIONS................................................................. 172 5.3 ANALYSIS............................................................................................................................................. 187 5.4 DISCUSSION ......................................................................................................................................... 194 5.5 CONCLUSION........................................................................................................................................ 196 6 EVOLUTION OF DATACOMMUNICATIONS ................................................................................... 197 6.1 THE EARLY HISTORY OF DATA NETWORKING – US DEVELOPMENTS................................................... 197 6.2 DATA NETWORKING IN EUROPE.......................................................................................................... 202 6.3 INTERNATIONAL INTERNET GOVERNANCE AND REGULATION BODIES ................................................ 206 6.4 RECENT INTERNET DEVELOPMENTS AND TRENDS ............................................................................... 208 6.5 THE EVOLUTION OF DATA COMMUNICATIONS IN SWEDEN .................................................................. 212 6.6 SUMMARY AND CONCLUSIONS ............................................................................................................ 233 7 EVOLUTION OF MOBILE TELEPHONY ........................................................................................... 242 7.1 INTERNATIONAL OUTLOOK .................................................................................................................. 242 7.2 THE EVOLUTION OF SWEDISH MOBILE TELEPHONY............................................................................. 265 7.3 SUMMARY AND CONCLUSIONS............................................................................................................ 292 8 EVOLUTION OF MOBILE DATA ......................................................................................................... 298 8.1 THE RADIO TRAJECTORY...................................................................................................................... 298 8.2 THE TELECOM TRAJECTORY 2.5G AND 3G .......................................................................................... 305 8.3 WIRELESS INTERNET – THE COMPUTER INDUSTRY PERSPECTIVE........................................................ 332 8.4 INTELLIGENT TERMINALS – PDAS AND SMART PHONES ..................................................................... 338 8.5 THE EMERGING ACTOR SYSTEM........................................................................................................... 342 8.6 A NOTE ON 4G ..................................................................................................................................... 344 8.7 MOBITEX – THE SWEDISH RADIO DATA
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