How a Small City in Finland Turned Into a 5G Pioneer

By Sascha Segan Features PCmag

OULU, Finland—The sun never sets on the 5G network here. Well, maybe it dips below the horizon just a bit. But at midnight on a Tuesday morning in June, it looks like 4 p.m., and the local pub is full of engineers attending a big European 5G conference.

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The pub isn't always that full on a Tuesday, the local barflies tell me. But Oulu, a city of about 200,000 up near the Arctic Circle, is always full of engineers. It's a perfect example of something America needs more of: a city that reinvented itself after its major industrial employer crashed. Out of the crumbling hulk of Nokia has come what's probably the northernmost startup scene in the world, with dozens of smaller companies now filling up Nokia's old offices at the edge of town.

Seven years ago, most of these companies weren't there: It was all Nokia as far as the eye could see. Even now, that's what a lot of wireless-industry watchers think of Oulu. When I asked T-Mobile US CEO Neville Ray about Oulu, he replied, "Isn't that where Nokia makes the base stations?" And he's right. But a funny thing happened when Nokia downsized five years ago, in the wake of its iPhone-induced, Microsoft-accelerated smartphone collapse. All those ex-Nokia engineers didn't leave town. They stayed. They built startups. And then they hired more people.

The startup scene in Oulu didn't happen all on its own. Finland has an intense level of public-private funding, with public money seeding venture funds that can then spread their wings privately. That's what happened with Butterfly Ventures, a major local VC.

"The city of Oulu, they wanted to create a venture capital fund ... [and] there was a little bit of European Union money," founder Juho Risku said. With public money backing Butterfly, Risku could introduce an "asymmetric model" to attract private investors, making sure that the private investors get paid back first. While that kind of incentive might not be needed in Silicon Valley, it's helped the more nervous Finns get more deeply into startups.

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"People in Finland have been a bit risk averse, traditionally, but that has changed a lot in the past five years," Risku said.

Tekes, the "Finnish funding agency for innovation," pitches in money, while the local university and its hospital also play a big role. It's a public university, remember. Over a weekend in Oulu, hacker teams from around the world pitched their ideas for prizes at the university's 5GFWD hackathon, with the winner coming all the way from New Delhi to show off his image-based indoor navigation solution.

So What's 5G For?

Over and over again during the weekend in Oulu, I kept asking companies: What are you going to use 5G for?

At the city's market square on one bright morning, I strapped on a Samsung Gear VR headset to watch a 360-degree live feed beamed over the city canal at 1.6Gbps. It was like teleportation. And as I looked at various businesses and buildings, little pop-ups showed sales specials, temperature, or the number of people walking over the bridge.

Those dreamers included Hendrik Schneider and Niina Sormunnen, two Finnish students who met at the hackathon. Their idea, known as Therecare, helps parents whose babies are stuck in incubators.

These babies are already covered in sensors and monitors, so Therecare gives parents a cylindrical pillow and a pair of AR glasses. The pillow, which is about the size and weight of a baby, is internally warmed to the baby's body temperature, and might even produce a "heartbeat" or "breathe" thanks to vibrating motors. Put on the glasses, and you'll "see" the kid you can't touch. As the baby is fragile, it won't feel you, but your voice could be transmitted into the incubator.

"With air, we are projecting your own child into your arms," Schneider said poetically. You can't do this with 4G, because the bandwidth isn't reliable enough right now.

The themes of "VR for health" and "VR for education" kept coming up over and over again in Oulu. At Oulu University Hospital, which has a test lab with mockups of hospital rooms for tech firms to try out their solutions, Jussi Auvinen, head of Peili Vision, put another Gear VR on my face. This one put me in a virtual world where I tried to shoot at targets with my eyes. This is, amazingly, stroke rehab: His software checks to see whether anything is neurologically missing from your field of vision and provides updates to your doctors.

With 5G, VR rehab could come home, or it could go to people in rural areas who don't have a lot of available doctors. 5G headsets would have connectivity embedded, making them push-button rather than needing configuration and Wi-Fi setup and broadband.

"We've done this in face-to-face therapy now, but we're starting in September to do this remotely. In virtual reality, when you go a few steps forward, you need low latency," Auvinen said.

And before you start sniping about coverage, T-Mobile is on it: It has proposed the first rural 5G network in the US, on its new 600MHz spectrum. Think 2019-2020 for that one.

They also print electronics in Oulu, which may come in handy when you need, say, a million connected bandages. At VTT, a government research center in town, I heard about "smart bandages" and printed antennas. Apparently, right now we can print small, flexible batteries that, alas, aren't rechargeable. But combine them with low-power networks, printed sensors, and printed antennas, and you have a patch that you can slap on a wrist or a wound to monitor how your healing is going—and that you can throw out afterwards.

But Oulu could have failed in the wake of the Nokia evaporation. The town managed to pull off its reinvention into 5G-ville by staying smart. It's been a factory town and a manufacturing town, but it doesn't seem like a screws-and-bolts town. If it was, it went back to school and figured out how to build medical devices.

My flight to Helsinki was delayed three hours in what's nowadays par for the course at JFK Airport, in a "summer of hell" for New York City infrastructure, where our main train station is crumbling so badly that it has to be partially shut down for repairs. The city, state, and federal governments pass the buck; the President's "infrastructure week" went by without any proposals, and the governor is more interested in cutting ribbons on new bridges than on fixing what's breaking. This in a country where our infrastructure was once world-class and where public support for science and technology led to the creation of the internet.

Oulu's public-private partnerships show it's impossible to unravel technology from politics, or at least from society. Through ventures like Tekes and Butterfly, Oulu shows that it's looking forward, not back—making things greater, not great the way they once were.

Ouluans could have stamped their feet and demanded that someone make Nokia great again, but that is impossible. Instead, they made new things, but with the help of a public university, a public technology research center, and a public venture fund. It's actually very similar to the model the US used in the 1950s and 1960s, when universities and research corporations such as RAND worked with the "military-industrial complex" to build computers and put men on the moon.

Could Finland's model be duplicated in the US? Maybe, if we focus on being smart and acknowledge that we can't bring back old jobs, but we can create new ones. There are places in the US we're starting to see that happen—in Pittsburgh, for instance, where health-tech and autonomous car development may show a future for when the shale gas dries up. Universities and hospitals can help lead the way.

The 5G world is coming. It's a world of startups, robots, software, and services. Our cities can join it or be left behind. There's no stopping it. Oulu sees that.

This article originally appeared on PCMag.com.