1. TMitTI 1 © Sakari Luukkainen T-109.5410 Technology Management in the Telecommunications Industry (3 cr) Sakari Luukkainen Department of Computer Science and Engineering

2. TMitTI 2 © Sakari Luukkainen Background of the course R&D investments in Finland are 5 billion € of which is privately financed 72 %, major R&D performed by telecommunications industry Telecom company´s cost structure is dominated by the R&D cost, which is biggest fixed cost Majority of those fixed costs are sunk costs which can not be easily recovered if technology commercialization fails

3. TMitTI 3 © Sakari Luukkainen Growth by industrial sector Source: Stat Finland

4. TMitTI 4 © Sakari Luukkainen Current slowdown - the development moves two steps forward and one step backward Media catalysts overestimated expectations in growth phase, and panic in decline phase Asymmetric information in the technology financing market High 3G license costs delay development Most of the success is related to GSM technologies, hyper price competition in mobile voice and SMS No history data of business – difficult to forecast, unreliable market research Background of the course

5. TMitTI 5 © Sakari Luukkainen Background of the course VC financing has so far resulted in a very few new success stories Only 20 % of R&D performed by companies can be exploited commercially The role of liquidity constraints is negligible in determining R&D investment – steady R&D spending Market uncertainty is however high - many technical possibilities open up with unclear market need - many failures and unexpected success Telecommunications business is technological innovation management

6. TMitTI 6 © Sakari Luukkainen Goal of the course To describe technology management as a part of the business process of a telecommunications company The course handles the structure of the telecommunications industry and its innovation characteristics, technology choices, R & D financing, standardization and product strategy

7. TMitTI 7 © Sakari Luukkainen Graduating the course The course is especially designed to students taking Telecommunications Management / Networking Business for their major or minor, but is suitable for all students that are interested in techno-economic issues related to telecommunications The preferred but not compulsory prerequisite for this course is TU-91.2005 Strategic Management of Technology and Innovation, it can be graduated e.g. parallel during this course Replaces old courses T-109.410, T-111.050 and TU-91.126

8. TMitTI 8 © Sakari Luukkainen Graduating the course 10 lectures, 2 industry speakers, on Wednesdays hall T3, at 16.15-18 Exam requirements consist of the lectures and the following books: Shapiro, Varian: Information Rules, A Strategic Guide to the Network Economy, 1999 Dodgson, Gann, Salter: The Management of Technological Innovation: Strategy and Practice, 2008.

9. TMitTI 9 © Sakari Luukkainen Graduating the course Attending and listening of the lectures, reading related books First examination is 16.12.2008 at 13 - 16 in lecture hall T1 Exam consists of three essay questions of which two is compulsory, six concept definitions and one applied question concerning some real life business case

10. TMitTI 10 © Sakari Luukkainen Telecom Management / Networking Business Telecommunications (Application area, research target) Industrial Management (Theory) Internet & Multimedia (Application area, research target)

11. TMitTI 11 © Sakari Luukkainen TU-91.2005 Strategic Management of Technology and Innovation 5 S-38.3001 Telecommunications Forum 1-5 S-38.3041 Operaattoriliiketoiminta 3-5 T-109.7510 Research Seminar on Telecommunications Business 5 T-124.5100 Verkottuneet liiketoimintaprosessit ja –mallit 4 Related courses

12. TMitTI 12 © Sakari Luukkainen Master’s Thesis Scope  Emerging technology / Product strategy analysis  New telecom service design  Integration of ICT & business processes

13. TMitTI 13 © Sakari Luukkainen Product Management Organization Vice President, Sales and Marketing Marketing Services Advertising Marketing Research Product Management Sales Product Manager Product Manager Account Manager Account Manager

14. TMitTI 14 © Sakari Luukkainen Product management is business process management Product Manager R&D Top Management Sales Finance Purchasing Production CustomersLegal Marketing

15. TMitTI 15 © Sakari Luukkainen Business Assessment: Hierarchy of Strategies Vision Corporate Strategy Divisional Strategy Product/Market Strategy Marketing Tactics Customer Satisfaction Source: Gorchels Focus on developing and leveraging core competencies Focus on customer- specific needs

16. TMitTI 16 © Sakari Luukkainen PM´s balance of management activities strategic the goal the reality short-term day-to-day short-term day-to-day Source: Gorchels

17. TMitTI 17 © Sakari Luukkainen Timetable 17.9. Introduction, Sakari Luukkainen 24.9. Innovation Process, Sakari Luukkainen 1.10. R&D Management, Sakari Luukkainen, Laura Takkinen 8.10. Standardization Strategy, Sakari Luukkainen 15.10. Productization, Sakari Luukkainen 22.10. Marketing, Sakari Luukkainen 5.11. Cases ISDN, DOCSIS and ADSL, Sakari Luukkainen 12.11. Cases ERMES, GSM, UMTS and LTE, Sakari Luukkainen 19.11. Technology Management in Nokia Siemens Networks, Ossi Pöllänen 26.11 Technology Management in Ericsson, Mika Peuhkurinen 16.12. Examination