Raiders of the lost copper – telecom heat

Finland, population around 5 million. Land of the thousand lakes. A high-tech country, with one of the best literacy ratios in the world.

Picture it. It’s 1990s. Radiolinja, a Finnish GSM operator, makes a world-first by enabling first ever digital voice call take place between two cell phone users.

The first era of digitization, a prelude to information society was over. Home computers became abundant, now with the sweet memories of Commodore 64.

The industry utilized computers widely, and banks had been avid front line troops into the new digital sphere.

However, ubiquitous computing was still missing from everyday life. Computers were stationary, at home, and people “returned to them” if there was a need to do something.

A bit of murky waters to be crossed. Finland had been been part of a sharp economic recession in 1990-1993. The national currency Finnish markka (mk) was devalued overnight 13.1%, which sent a shock wave: small businesses collapsed, and there were wounds to be recovered.

However in about a decade, as we came to the dawning 2000s, the economy was already in full heat: led by a high tech behemoth Nokia – and still in 1990s, paper and pulp exports. Nokia had transformed from a conglomerate to a sharp-wedged product-based company, with almost eponymous consumer product: Nokia mobile phones. The business unit was named simply NMP – Nokia Mobile Phones.

Alongside Nokia there were many key infrastructure players:
electronics manufacturers capable of doing telecom cables, connective tissues of the new world. Handset manufacturers need also precision parts for the mobile phones; these were often subcontracted.

And there were telecommunications companies – “telcos”, that had actually made
their origins in the early 1900s, by laying copper in the air and sometimes ground, in the form of telecommunication cables. Copper is a valuable metal, that has great conductive properties. Copper is also rather soft, malleable and can withstand bending without breaking. These made it perfect for the purpose of relaying electronic signals great lengths. There was only problem: copper is expensive!

Analog signals and later digitized voice traveled down these endless amounts of cable connections. Telephone switches gathered and routed voice calls.

In 100 years, the telecommunication in Finland had jumped to a pervasive service. Switches, which were originally manually operated by switching board personnel, were now automated. Calls would thus take place any time, between any two landline phones. In addition, people were liberated from their desk at home, by mobile phones: voice calls and text messages could be sent from basically anywhere. Roaming enabled the same mobile telephone to be used from abroad, too.

Telecom companies were betting big on innovations circulating around the new wave of mobile telecommunications. Landgrab of new applications’ revenue streams was enticing, in addition to providing purely mobile communications: there were far-reaching visions that whet the appetite of investors, folk, developers, and corporate leaders.

One of the problems was that this was unknown territory. No one actually knew exactly where the “spaceship mobility” was heading; nor when. Things sometimes seemed to be intertwined; early smartphone prototypes clearly suffered from lack of proper display technology, memory chip capacity, and many other things that would 20 years later be in a much more suitable shape.

I personally had a PDA called Psion Revo, which was for me a showcase of what technology can achieve, but it somewhat fell into obscurity due to two weaknesses: lack of software, and lack of mobile connectivity (network). Without these two key features the device was frankly a bit useless.

Some of the big trends of early 2000s were:

  • location based applications
  • dating apps
  • ubiquitous computing
  • mobile gaming
  • restaurant reservations
  • mobile electronic tickets to sports venues (matches)
  • traveling applications
  • phone directory applications

Analog phone landline subscriptions, in the meanwhile, would basically be shifted out completely during the 2000-2010. However the installed base of landline devices was immense, and there was a question of how would it make sense to do the transitioning? Digging cable channels underground is very expensive and disruptive to society: especially traffic congestion and re-routing considerations are some of the most direct issues to be faced.

The next wave of communication would be in air: mobile! However,
mobile communications critically needs cables: mobility is almost an illusion brought by a swath of base stations. A smartphone is always in the range of one radio station. The phone hops from station to station, as the user moves. Thus in reality there is no continuous radio field, but an overlapping mesh of “cells” (access points).

The radio cells are connected to each other either with a microwave link or fiber optic cable. So mobile telecom and landline telecom business have this as a congruent need.

Together mobile technology, software and connection innovators were
doing major leaps that could revolutionize the way people connected
and worked.

The number of mobile subscription clients rose, yet the counterbalance in
the revenu equation was slowly going down due to competition and
market saturation (average revenue per subscriber). Finland was
relatively liberal in telecommunications de-regulation, which meant
lower consumer prices for telecommunications.

Telecom stocks during the “Internet boom era” and early years of Internet revolution were heated — and later they were source of many folk tales.

Cornering telecom companies

Finland was structured so that a few big banks basically controlled all incoming funds and thus investments. Telecom companies need hefty amounts of capital especially when they are making initial growth for a new generation of technology. The existing 1900s era copper cables were valid for Internet broadband connections, but mobile networks had to be built from scratch.

In mobile technology, you need cells: a tower is built either from concrete or aluminum beams. In this tower, there’s an antenna array. The mobile base station is completed with accompanying devices and power feed at the feet of the tower.

Photo by Jonas Svidras on Unsplash

Basically almost every household in the country owned at least one share of a telecom company — this share made the house eligible to have phone equipment and an operative phone line.

In addition to buying the share alone, a telephone user paid charges
the actual usage, according to a call plan (contract).

Shares could be bought and sold. Before 1990s the telephone stocks
were not of speculative trading interests; they were namely just a technical
by-product of ownership rights.

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