Strong future for enterprise IT in Nordic countries

From attracting the world to its ice-cool datacentres to the digitisation of the public sector, there is plenty going on in the Nordic region

From attracting the world to its ice-cool datacentres to the digitisation of the public sector, there is plenty going on in the Nordic region.

Part way into 2015, we spoke to some of the region's experts in enterprise IT to get the lowdown on the newest trends hitting northern Europe.

Enterprises of all shapes and sizes are starting to see infrastructure as a key enabler of their business. Jason Hoffman, head of cloud software at Ericsson, sees a big shift in progress.

“As more industries become information enabled, infrastructure and business models can no longer be seen as separate systems,” he says. “The desire of our customer base is to move away from infrastructure that determines or limits the business. Whatever your thoughts on Google or Amazon Web Services, their approach to infrastructure has inspired a lot of new growth companies.”

Arctic home for world’s data

Such infrastructure has found a natural home in the small Swedish town of Luleå, which has a proud history of technological research. The Node Pole alliance now supports the area as a location for world-class datacentres. The combination of simple Scandinavian design principles and the cold Arctic weather provide an ideal environment for some of the world’s biggest companies.

Facebook was so pleased with its first Luleå datacentre that it swiftly built a second, while Google has invested more than $1bn in its datacentres in Finland. Ericsson is consolidating its global network of 950 datacentres down to just three, two of which will be in Sweden.

Rise of lightweight containers

Container-based infrastructure frees businesses from the shackles of single suppliers, and enables easier administration and more rapid development. Tor Rune Skoglund, CEO at Norwegian distributed infrastructure startup FourC, says: “Virtualisation is hot across the region right now because companies want to make better use of their hardware investment. 

“Lightweight container systems such as Docker are gaining popularity faster than more heavy-duty VMware. Sectors such as public transport and healthcare are taking advantage of high-tech solutions for the first time, and soon the days of being locked down to a single supplier will be gone.”

Paradigm shift in security

As cloud systems begin to dominate, the question of security has never been more important. Ericsson has partnered Estonian security-technology provider Guardtime to improve the safety and transparency of data transmissions, and Ericsson's Hoffman believes the whole approach to security, risk and governance is changing.

“Clouds are highly accessible programmable systems,” he says. “The entire software industry ships products that limit access; we have to have a paradigm shift in the security model. Integrity is what has been ignored by the security industry. 

“Why are cost-effective cloud systems not tamper-proof? Guaranteed integrity must be a primary feature of any infrastructure system going forward, whether hardware system, application data platform or data storage service.”

Public-private debate not over yet

Private clouds have struggled as IT suppliers cobble together what they can, whereas public clouds are free from such legacy shackles. Hoffman says that although many private systems have been built, they are not really clouds.

“The key attributes of any cloud system is that it’s entirely accessible and entirely programmable,” he says. “Companies like Amazon and Google changed how hardware and operating systems are built, whereas the architecture and composition of private clouds was driven by the desire to have an economic model, not the other way round.”

The newest private cloud products offer a similar performance level to public clouds, but with global firms such as Johnson and Johnson announcing a shift to the public cloud, the future success of private clouds remains to be seen.

National clouds

However, one type of private cloud that seems certain to continue in the Nordic region is the national cloud.

“We will see a change in how clouds are viewed,” says Hans Hentzell, CEO of Swedish ICT.

“Although more services will be handled in the cloud, a lot of the new applications will require specific national clouds. In Sweden there is a law that requires the use of a national cloud if you handle healthcare data or information on schools. 

“Individuals have a choice on how much data they store in clouds, but authorities must decide if they want all data to be open to anyone with a good insight into the technology. For now, they have decided not to do that, but full security for each individual will, of course, hold back development.”

Further digitisation of the public sector

The Nordic region's e-government services are strong, but much public sector technology still suffers from inefficiencies in development. Norway’s TETRA-based public safety radio system, originally planned to be fully functioning by 2011, still covers only parts of the country.

To tackle this problem, NHO (Confederation of Norwegian Enterprise) has launched a dialogue conference concept. Public sector management, IT suppliers and interested third parties such as researchers gather at crowdsourcing events to gain a better understanding of the problems and formulate new solutions. An event in Trondheim this month will examine GPS-based systems for tracking dementia patients.

Hentzell believes healthcare will also be a focus in Sweden.

“The take-up of digitisation in government services, and awareness in industry that business models have to cope with digitisation, is already here,” he says. “With a quickly ageing population and increasing costs for society to handle this, digitisation of healthcare will come very soon.”

Automation finally catching on in Norway

Connecting and automating tasks between different silos enables businesses to collect critical information in real time, driving better business decisions. As IT environments become increasingly complex, automation can be a great simplifier. 

Although digital industrialisation has spread rapidly across the Nordics, Rolf Frydenberg of ManagE says automation has struggled to gain a foothold in Norway.

“High Norwegian salaries mean outsourcing to somewhere where you can rent a workforce at a much lower rate – whether that’s South-East Asia or Eastern Europe – has been the easy option,” he says. “It’s all or nothing in Norway. We are a leader in virtualisation, and although the US started using virtualisation earlier, the adoption curve was slower.

“People are starting to wake up to the potential of automation. The trigger will be a highly visible success story, the one thing that makes everybody sit up and take notice.”

Where do we go from here?

Over time, it is clear that IT spending will shift from buying and maintaining hardware and software to subscribing to cloud services. With the likes of Google and Facebook continuing to look towards the European Arctic for their modern infrastructure needs, the Nordic region is well placed to be a leader in enterprise IT for years to come.

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