Charting the rise of Nokia

Nokia was not always this high-tech

World Business Report's Wendy Pascoe has travelled to Finland to find out what the country thinks of its most famous corporation

In 20 years the mobile phone company Nokia has grown from being a manufacturer of toilet paper to a leader in the cut-throat world of global telecommunications.

Nokia is now so large and powerful it dominates the economy in its home country of Finland, which was previously best known for its paper and pulp industries and long dark winters.

The value of Nokia's net sales are about the same as the annual budget of the Finnish government.

"When the company bet its future on mobile phones back in the late 1980's, that move was seen as very radical."

Tero Kuittinen

It contributes to the country's economic growth - it increased GDP by more than 1.5% in 1999 alone.

At its peak, it made up about 60% of the value of the Helsinki Stock Exchange.

Ambition

Tero Kuittinen, technology adviser for Opstock Investment Banking in Helsinki, believes there are two reasons Nokia has come so far so quickly.

"Nokia is fundamentally a consumer company and as recently as two decades ago it was still selling things like toilet paper - very tough businesses. You have to sell these products by very strong branding", he says.

"The other reason is that Nokia has a history of taking big bets and big risks", he adds. "When the company bet its future on mobile phones back in the late 1980's, that move was seen as very radical."

Encouraging growth

As Nokia has grown, a whole information and communications technology sector has sprung up around it.

Some of these companies work directly for Nokia, others owe their existence to the company because of the huge sums it's spent on research, development and staff training.

"If Nokia were to experience difficult times, it would mean difficult times for Finland but it would not bring the economy to ruins"

Hannu Ollikainen

Spring Toys, a Helsinki based company, started off supplying games just to Nokia, but has now expanded.

But would it have even existed if it hadn't been for Nokia?

"It would have been much harder to build a company so fast and to get the money", says Spring Toys co-founder Panu Mustonen.

NokiaLand

Nokia dominates Finland culturally as well as economically.

Some now call it NokiaLand.

But if Nokia ever seriously stumbles and sales collapse because of the global slowdown Hannu Ollikainen, managing editor of the business magazine Talous-elama, says that the Finish economy would survive.

"There is life outside Nokia in this country and there is viable businesses other than Nokia", he says.

"We have a strong heavy metals industry sector and also the traditional paper and pulp. If Nokia were to experience difficult times, it would mean difficult times for Finland but it would not bring the economy to ruins", he adds.

Helsinki may not have the size or stature of London or New York or Tokyo. But Hannu Ollikainen says Nokia's lasting achievement is to show Finnish companies how to think big and to have the confidence to compete globally.