Venturing into Swedish Business

Sweden's famed bank takeovers in the early 1990s have received lots of publicity, but now two of its big banks -- SwedBank and SEB -- are dragging down the economy because of bad loans to Baltic nations.  The kronor is likely to weak, loans will tighten, and unemployment will probably surpass the forecasted 11.3%.  
http://www.wsws.org/articles/2009/jun2009/balt-j15.shtml

The "Swedish Dream" may be over.  Like other nations, Sweden faces the daunting task of rebuilding its banking system and economy, while cutting social, health and educational programs.  But that only reduces deficits.  To rebuild its finances, Sweden needs to increase revenues by expanding exports of its small and medium enterprises (SMEs), which are weak in global marketing.  For export-shy SMEs, that will be no easy task indeed. 

The Christian Science Monitor just published an article arguing that Sweden is moving away from the "socialist nightmare" by privatizing many industry sectors, which has triggered a lively volley of comments.   

Sweden is taking the high ground with the upcoming launch of its 4G mobile network next year, which will put Stockholm into the lead -- a mobile Sputnik in the land of Social Democrats.  When will the U.S., German, South Korea, China and Japan catch up?  

I'm co-launching a mobile learning venture here that will offer corporate training, K-12 mobile courses, and women entrepreneur networking.  The mobile office and classroom will create lots of new business opportunities.  Already, handset makers like China's ZTE are entering Sweden to grow their market share and lure Nordic content and service providers for China's networks.  European and U.S. companies are likely to follow suit, so keep an eye on Stockholm.
http://networking.cbronline.com/news/ericsson_teliasonera_unveil_worlds_first_commercial_4glte_site_in_sweden_250509

Sweden faces a tough choice:  support manufacturing or diversify to service industries.  Although the government declined to bail out Volvo and Saab, its trade policies still favor "atoms" -- tangible goods that can be counted and exported.  The trade minister admits that Sweden doesn't track or promote "bits" -- intangible service industries.  

The recent sentencing of the Pirate Bay founders is likely to have broad impact on file sharing. There has been a major decline in Web traffic here, indicating the high level of pirated file sharing.  It will move file sharing to less-regulated regions and create opportunities for media creators.  Hollywood's latest movies may be protected more, but the ruling doesn't discourage the studios from flooding the Web with TV reruns and old movies to brand themselves.  Moreover, the decision will probably encourage more creative types of pirating.  
http://www.pcmag.com/article2/0,2817,2345485,00.asp

Sweden is clamping down on the Internet, starting with government monitoring of all Internet traffic since January and now stopping peer-to-peer piracy.  While this stops illegal activity in the short term, increasing government control is likely to shift innovation offshore.  Sweden could become more of an IT backwater.  That would undercut its growing IT industry, one of the few sectors to offset its manufacturing decline. 

Surprisingly for a social democratic nation, Sweden has adopted school vouchers where students have a choice where they want to study:  http://video.nytimes.com/video/2009/03/15/opinion/1194838660912/sweden-s-choice.html

Would it work in the U.S., where teacher unions are powerful obstacles to change?  Probably not in many states, but I think many innovative states would be willing to allow private and parochial schools to compete since many public schools are failing miserably.  The recession will push many states that are cutting educational budgets toward vouchers as a way of containing costs while improving quality.  With many professionals out of work, it would be easy for private schools to hire top talent and train them in teaching methods. 

Like the bank bailout, environmental quality, and gender equality, Sweden has a lot to teach the U.S. -- if it pays attention.  During the global crisis, the U.S. needs all the proven ideas that it can get.

Last week, I attended the "Women in Business" cruise off the coast (type www.kvinnoriforen.se into Google Translate for a translation) and was surrounded by 300 driven entrepreneurs from all over Sweden.  For 24 hours, we attended workshops, swapped ideas and business cards, and just had fun.  Swedes have the image of being very reserved, but this crowd was enthusiastic, outgoing, curious and eager to discuss things.  It reminded me of being in San Francisco.

Sweden's industrial production has fallen off the cliff so the country needs entrepreneurs to create the next wave of small business enterprises (SMEs).  Many existing SMEs are suppliers to Volvo, Saab and other manufacturers so they're going down with the auto industry.  Who will replace them?

Many of the women run service businesses -- Web design, marketing, consulting, healthcare, counseling, and other non-manufacturing businesses -- out of their homes.  Many supplement their husbands' lost or declining income.  Others are single.  Some are expanding into office complexes, but the question is whether they can scale up. A big opportunity is leveraging social networks, both online and offline, to find new customers, suppliers and partners.  This is beginning to happen as there are more women's networking groups and portals in Sweden.

Sweden is not unique.  Women worldwide have been running home ventures for centuries, but are now becoming a major force since the world is undergoing a major restructuring.  Exports are being replaced by domestic growth. The United Nations has advocated giving microloans to women as the fastest way to promote economic growth.  The current credit crunch makes it more important to find alternative financing mechanisms.  Lending circles and cellphones are some financing sources.  I think this area is ripe for innovation.  Perhaps women enterpreneurs will be the next financial giants.

The trial over Pirate Bay's alleged copyright infringement just ended yesterday in Stockholm, with the verdict to be issued on April 17th.  The defendants claim their P2P portal is only video search tool, but prosecutors aren't buying that argument.  This looks like another Kazaam, which was shut down earlier. 

If the verdict is guilty, YouTube and others will definitely feel the chill, which stunt the emerging Web video industry.  My bet is that the two are convicted.  Let's see how the court rules. 

Sweden was just ranked #1 in the use of information and communications technologies (ICT), ahead of South Korea: http://www.monstersandcritics.com/news/europe/news/article_1462382.php/UN_Sweden_South_Korea_top_countries_in_information_technology_

Amazing standing since consumer device prices are much higher than in the U.S., but then the Swedish government and companies invest heavily in advanced technologies.  Sweden is the opposite of the U.S. approach -- high consumer prices, widespread public infrastructure.  Obama has some catching up to do....