This year we have taken a different approach to publishing 2013 predictions, separating the Ten Predictions, which are meant to stand in specifics, word for word; from the technology and economic landscapes on which they will play out. 

In this week's Report I am laying out these terrains, in the hope they will be of general use for all members needing to plan in the coming year. Starting with the economy:

The Economic Landscape

 Theme: "A Flip in Growth Rates"

 I.  The US leads, as the safest, strongest, most trusted economy in the world with dollar strength to prove it.

The most important economic fact of this year will be the complete reversal in the trends of growth rates around the world, in an almost ecclesiastical about-face, as the leaders fall down the YTY change ladder and the slower economies speed up.

This is not to be confused with absolute numbers for GDP, but to focus instead on the changes YTY in those figures. It isn't what you did for me today, but what you'll do for me tomorrow, in a sense.

The world of 2013 looks remarkably different to me than that of 2012, with the upside showing more strongly in the US and less strongly in both the EU and Asia. We'll cover the reasons for this below, but the results will be a subtle but marked shift in enthusiasm on the part of CEOs and investors for US-related decisions, including a continued strong dollar; improved GDP; stronger core return sectors in housing, finance, and construction (Missing in Action for the last five years); and the on-shoring of jobs and operations such as Apple has just announced.

In general, US CEOs are recognizing a new economics and benefit set from keeping jobs at home something I expect EU, UK, and Australian CEOs to also see in the next year or two.

II.  China manufactures its own containment. A lack of trust shows up worldwide, on the parts of: national equity markets, political leaders, media, investors, corporate chiefs. Now what?

As with Japan before it, China's favorite reply when others complain about its illegal international business practices is: the West is trying to contain China. In fact, China is becoming its own most potent source of those things which are constraining its growth. This is an important trend, and one different from that painted in the global press.

Specifically, we now have the collision of Chinese accounting practices (shoddy, and often held as "state secrets") colliding with global practices, leading to being barred from national equity markets;

the Big 4 accounting firms' China branches under administrative charges by the US SEC for withholding audit documents in cases of shareholder fraud in the US and Canada, with the possibility of sanctions that would prevent these firms from practicing in those countries;

Chinese banks being forced out of the City of London by an increasingly cautious regulatory system;

and companies like Huawei, intentionally posing extreme high-security risks to their customers, perhaps hoping for no pushback, instead being prevented from participating in most US infrastructure and the Australian National Broadband Network, and now being quietly ripped out of the British telecom system, where it was just recently installed (and yes, this is the first you've read of that).

The most appropriate term to describe these behaviors would appear to be "self-limiting." While most poor nations (Portugal, much of ASEAN) can't afford to care about matters such as national security vs. low price (what a mistake!), those that can are not constraining China; they are simply providing the field upon which China now constrains its own growth.

III.  Russia: Now things get Really Scary.

I didn't know how else to put this. What does one say about the tragic and perhaps terrifying re-Stalinization of this nuclear power?

Having eradicated all forms of democratic government, driven almost all oligarchs into expat life, taken over or destroyed all media outlets (except one), killed or jailed (or jailed and then killed) all opposing politicians, killed or jailed all opposing journalists, and having provably eliminated any remaining sense of fair judicial process through a decade-long string of farce trials (most recently including that of Pussy Riot), we have (drum roll):

Putin's Dream Russia. 

In this new country, represented best by the man himself, pictured shirtless upon a horse, some kind of cross between Stalin and the Cossacks.

No freedom of speech. No market economy. No judicial review. No rights. No political dissent.

Nothing, in fact, except Putin himself, driving an economy based upon the seizure of natural resources by the state. 

What does this mean? 

Why aren't more people writing about this dangerous slide into some new Cult of One as a government structure? Did you like Idi Amin?

Russia has moved from Kleptocracy into a very strange place where even the Russian people, as inured to the comfort of czarist regimes as they are, do not want to go. Unfortunately for them, they waited to protest the latest renewal of Vlad's power until after all of theirs had been stripped away.

The world should be watching this process much more closely than it is doing today. It promises to be tomorrow's Very Bad News.

IV.  Post-communist nations: The crisis of not having a unifying principle.

What is the biggest problem facing Putin today? What is the new Politburo's biggest concern, now the face of its age-old worry about stability? 

Is it money? Energy? Political maneuvering? No. In both cases, it is the void left when a communist government outgrows its economic system and the people of the country are left with no unifying principle. 

The word is that this is now the top concern in the Putin camp: what does Russia stand for in the minds of its people? What will hold them together?

And, interestingly, this is exactly the same concern being attacked, in real time, by the Standing Committee. What is China? In a Post-Confucian, Post-Mao world, what drives patriotism? What is the nuclear glue that defines China? Is it just wealth and "rule-less-ness," or is there something deeper to hold the body politic in sway to their leaders?

In both countries, the leaders are in agreement: there had better be. But they do not know, today, what it is, nor how to get it into the hearts and minds of their people.

V. Japan goes Ultra Nationalist, with Ishihara greasing the skids.

Is the world ready for the New Japan? Are the people of Japan ready for the New Japan?

I will guess that this transition will begin with Shintaro Ishihara having a prime although, to many foreigners, invisible place in the process, with the return of the LDP to power on December 16th a foregone conclusion. But the effect of his presence on the stage, and of China's recent belligerence in the South China Sea, will be:

This LDP won't be the LDP you remember from the last 30+ years of government. Welcome to 1944.

The primary platform on which Shinzo Abe will win will include:

 And much more.

Most likely, this will also include  strengthened US relations, and an increased presence as the third balance point in political and military power in the region, taking a little pressure off the US while creating a new entity which, ultimately, will be an aggressive force not seen since WWII.

You could call this: Step X in China's Self-Containment Program.

VI. India: Progress in small steps.

Of all the BRICs, this seems the only country that has a net positive look forward. Small steps, but positive ones, led by the new retail reforms, and an apparent new willingness to consider allowing competition and start combating the entrenched bureaucracy.

That will take a few decades.

VII.  UK: Cambridge in, Cameron out. 

The UK is in a very strange limbo coming into 2013: not out of the EU yet, and likely to get dislodged this year, by referendum or other means. Not expanding economically, but not shrinking as badly as almost all the rest of the EU. Governed by an uneasy coalition of not-like-minded parties, and with a government that can't seem to stop stepping on itself, from hiring Rupert's now-indicted editor-cum-PM communications manager, to taking extreme (and perhaps unintended) domestic risks in EU negotiations.

Huawei buys the country for about $1.2B and gets PM Cameron to cheerlead the company, even as BT is yanking out its equipment because it's made for spying and takeovers.

At the same time, Cambridge is producing some of the best science and technology in the world. And, as we all know, technology drives the world economy.

Sum it up, and it all seems obvious: Cambridge is the country's greatest asset, and Cameron its least likely PM. Boris next?

VIII. Indonesia: A moderate growth story. And Peru.

Amid all of the shifting sands and chaos, there are a few relatively simple growth stories, and these two countries, for highly different reasons, seem likely to do well in the coming year.

Investors can make their bets based on which story they think matters more: China slowing or South America picking up.

IX.  Cambodia: Its new role as China proxy/puppet.

Just as Cuba disappeared from the map of original voting nations, following Russia slavishly for years, it would appear that the same fate has now befallen Cambodia. One can now count on this country to take marching orders from Beijing in any international voting situation. Too bad, Cambodia was kind of cool for awhile, wasn't it? No, actually that's Pol Pot's home turf.

X. Singapore's aspirations to outpace HK become more real.

Singapore's age-old dream is looking more likely during 2013, as China clamps down on Hong Kong and businesses become more interested in being near, but not necessarily in, China. Any ramping-up of military tensions among ASEAN countries claiming South China Sea islands and territories will just accelerate this trend.

XI.   Oz and Brazil suffer in their China embrace, while Canada continues its quiet, boring, nice, lucrative oh-so-Canadian walk in the park.

There is a fascinating economic story that unfolds for each and every nation that, in its turn, decides to become a major trading "partner" with China. I put this word in quotes because China's business model requires asymmetric trade with its victims. I mean, partners.

The patterns are now quite obvious:

The U.S. was first up, experiencing all of the above. These results of the Deadly Embrace continue today, and even now baffle most "experts" (but not, in fact, presidential candidate Romney) about their cause.

Brazil is the current classic case, and I won't bore SNS members with a re-statement of the above. Just make a list of checkboxes, and go down one by one.

Yep, that's Brazil in 2013. Remember how well it was doing, just before its dance with mercantilism began?

It's time for President Dilma Roussef to wake up and smell the Lula juice.

XII.  Regarding Country Landscapes: GDP is no longer the driving fact nor even the trailing indicator.

IP wealth is what matters. The creation, transfer, and use of IP are what define national economic health.

The Technology Landscape 

Theme: "The Great Contest"

We are participating in a great contest between two diametrically opposed business models: the free market model of the Inventing Nations vs. the mercantilist model of those that must steal inventions in order to drive GDP.

The great global economic battle today is not between Haves and Have Nots, nor Communists and Capitalists, nor Islam and Christianity. The great battle today is between those nations which invent things and those which steal them. Who wins this battle will determine the course of future human economic well-being for generations. Let's hope the Inventors win.

I.   The Great Battle over smartphones.

As far as I can tell, the current battle is just about over. Japan never made a dent, Nokia knocked itself out of contention just as the fight was beginning, Microsoft never reached critical mass, and Samsung owns the market. Apple made a terrific impact when it defined the category through Steve Jobs' contributions, but Samsung quickly caught up by copying everything in every bracketed size, shape, and color imaginable. (See "SNS: Samsung Electronics," Oct. 31, 2012, for descriptions of Samsung's bracketing tornado business model.)

If one needed a death knell for the era, and an opening shot for the next, it is as giant mercantilist China moves against Samsung's and Apple's domination. (To appreciate what this means, check out the history of this company's phone sales, from zero to today's huge figures: national help at work.) And the chess move of the year? Huawei is doing a massive expansion of its "R and D" center in Finland. Hey, you don't think it's just going to "hoover up" all of those fired Nokia employees, with all of that Finnish IP? Shades of Motorola.

II.   The Great Battle over pads.

With Steve Jobs out of the game, we seem to be looking at a few major players: Google/Samsung (example, Nexus 10), Samsung, Apple, Microsoft, Amazon, Asustek. Do Google and Microsoft really want to be in the hardware business? Does Larry Page really want to have Things around that he has to store, and that get old really fast, and then are worthless, and have to be written down and then off, and that break and get dirty, and that people get mad about and throw at the wall and then return?

Apparently so, through both their phone and pad effort. I like Apple in the short term, because of its ecosystem, and Amazon right behind it, because Jeff's so smart.

III.  The Great Battle over PCs (Dell, HP, Acer, Lenovo).

This is the WWII of the technology world, at least in modern times. The big guns, the field artillery, the things that used to win wars before we had nukes and drones. While HP held the field for many years, its dysfunctional board has brought it to a state of hypoxic management-level disintermediation (HMD). This means there isn't enough oxygen in the room for both managers and directors to breathe at the same time. Result: boards hire their own, no one talks, everyone leaves early.

Dell owned it after that, following the Invention model with the Supply Chain Genius model. That worked until the mercs showed up. After all, it's one thing for Lenovo to tell the State that it won a huge piece of market share at any price, but another for (SNS member) Michael Dell to tell Wall Street about falling margins. The first gets more money; the second, no.

IV. The Great Battle over verticals (Apple, Google, Amazon, MS).

This is the panel topic that every conference (except ours) will lead with in 2012: which vertical integration play wins? It really is an ecosystem war, but behind it all are business models and margins.

How will Amazon fare as the e-reader becomes less important than the pad because this is one of the big, big stories of 2013: e-books prosper, but pads start replacing readers. Can Jeff's Fire pad (shame on you again, Bezos, for stealing our name) make the bridge we described two years ago? Will the Trojan horse strategy work?

Jeff gets 10 points for being smart enough to see it, and gutsy enough to try this Bourne-like leap.

Apple, I think, loses vitality. We'll see.

Microsoft is trying to gain it, and the question has shifted in a really interesting way. It used to be about making boring products. Now, the company has suddenly shown it can make pretty cool products. But will anyone buy them? Even now, it's very, very hard to write the words "cool" and "Microsoft" in the same sentence. That's a huge branding problem, as Steve tries to move from his original "we're the plumbers" CEO speech to the new "devices" vision.

V.  The Great Battle over TVs (is over).

Remember when the mercs took the TV industry away from its creators? Japan sent waves of very nice guys in business suits to the US to take pictures of the factories at Zenith, etc., and then poof! Japan entered the TV business, and the US left it, never to come back.

For a few decades, Japan owned this critically strategic business. And then another merc came along, one which had learned all Japan had to teach and then some: South Korea. SK quickly figured out that the glass was the part that mattered, and out-merc'd Japan in glass, and then chips, and then of course TVs. Today, there are two companies in this business, both from SK, and Samsung is the only one that matters (LG is the other).

Get ready for the Big Merc, boys; China's got your number. Until then, this fight is over. (Note: China bought Phillips TV two years ago in order to get the brand, for the sole purpose of achieving acceptance on the global market stage, and perhaps even a little merc anonymity.)

VI.  The Great Battle over consumer electronics (is over).

Consumer electronics: just ask the CEA this is one of the world's largest businesses, and getting larger. It's also strategic: the creative ideas that first show up in hardware and software on CE devices increasingly more often work their way up into the computing mainstream. Moderate that old trend with the fact that, today, CE is the mainstream, and you can appreciate the International Competitive Strategic Value.

So, obviously, this is the most competitive and fought-over turf in tech, with an unending series of winners and losers, from companies to countries, no? Not altogether.

This battle is over, at least for Merc Wave 2. And, not surprisingly, South Korea won. Wave 1: Japan. Wave 2: SK. Want to guess who will win Merc Wave 3?

I find it amusing and a bit disconcerting that so many pundits and their websites  obsess over gadget details (half an inch there, part of an ounce here), while whole nations rise and fall based on the integration of their government industrial policy and targeted, supported corporate efforts behind these small devices. It doesn't matter much which phone model wins for a month or two, but it really matters when South Korea decimates the Japanese position in Consumer Electronics.

VII. With Apple's creative streak done, the US risks losing its place in device design (over multiple years).

If this sounds like pre-judgment, it is. I think Apple has seen its most creative days, and now we get to go through the Sculley/Spindler/Amelio days again. While many others are starting to see this same picture, no one is asking the deeper question: What does this mean on the international stage? Who else in the US is doing world-beating design in consumer electronics and computing?

(Long silence.)

VIII. China's online backlash. By barring virtually all foreign online firms from success, China now runs the risk of self-containment in this key business medium, even as it pushes for online domestic champions to raise funds and grab market share in other countries. Which inventing nation or region will be first to respond to this exclusionary behavior by banning access to equity or retail online markets?

It is beyond bizarre that a nation has apparently decided that no foreign firm will be allowed to succeed in the most strategic industry of our time: online commerce.

Can someone explain to me why no one is writing about this?

Imagine if the US or EU announced that no non-domestic firms would be allowed to succeed in cars, or white goods, or CE, or TVs, or phones. The world would howl.

So why, exactly, is no one howling about China's exclusion/mistreatment of all online companies? This is the most egregious violation of global trading norms in practice today, affecting the most strategic business sector.

Hello? Anyone home? Just ask Google, Yahoo!, or Facebook how this works. Or the companies that ripped off their models and now have taken their places: Baidu and Alibaba.

If this is a prediction, it is a foreseeing of the backlash of other nations, as these Chinese firms born of copying and exclusion soon enough come to foreign trade and equity markets looking for more money. Will they see an open door, or will those nations say something like: "Are you kidding?"

This, again, could end up as yet the next chapter in Chinese Self-Containment, as policies at home that do not match legal definitions of international norms collide with global standards. This is a battle that will go on for a decade, and which, ultimately, the larger group of nations will win.

Your comments are always welcome. 

Sincerely,

Mark R. Anderson

Top 10 Predictions for 2013

THEME: "MAJOR MARKET SHIFTS AGAINST A STABLE BACKGROUND"

I.                  "CarryAlongs" Dominate Global Computer Markets. This category of pads and slates takes its rightful place as the largest market segment of computing devices. Already the fastest-growing category for several years, the format and dominant market position comes to pass in 2013.
 

II.               Intel: Long Live the King, the King is Dead. The chip royalty ladder is flipped, as Intel becomes increasingly irrelevant in the world of general computing, while CarryAlong and mobile chipmakers (led by Qualcomm and ARM) are the new William and Kate. For most observers, Intel in 2013 is a component supplier for servers. The best way out of this cul de sac: a new CEO with tech chops.
 

III.           Net TV Dominates. A majority of US-based homes will have Net-connected TVs, with other developed nations quickly following as bandwidth allows. This change in distribution will begin to affect production in new and interesting ways, leading to more and cheaper content, of increasingly varying length and format. The straitjacket of Old TV slots, ads, and schedules is now off.

IV.           The LTE vs. Fiber Battle Creates Regional Revolutions in Broadband. Customers choosing broadband LTE (Long Term Evolution) in DSL-served regions will be paying more and getting more; but those choosing LTE in fiber-served regions will be paying more for wireless broadband but getting less. The LTE vs. fiber fight will define the telecoms business-model battle for the coming decade. With LTE speeds scheduled to exceed cable and DSL wired speeds for many users, the question of price per MB will be inverted. Is it about MOB or MBS? This is the start of real revolutions in broadband pricing and provision.

V.               Google Gets Its Mojo Back. Facebook is tired and nosy, Apple is Steve-less, Microsoft is Microsoft, and Amazon is the only other game in town. Google's efforts in email, video, smartphones, maps, and driverless cars open up new long-term expansion paths, with more to follow. With all its many failures, the company has proven it can find and plough new turf. In terms of creativity, Google becomes the next Apple. Now it must learn about product support or risk losing it all to competitors.

VI.           The Driverless Car Becomes a Serious and Competitive Global Project, with multiple new states and countries passing laws to allow it, and major brands undertaking serious development of all the features that will one day lead to common acceptance. (Note: This prediction was written before Volvo's December 3 announcement.)

VII.        e-Books Are The Books. Total e-book sales in dollars will beat adult paperback sales in 2013, and their differential growth rates will exceed 30%, as e-books continue their ramp toward dominating the entire market.

VIII.    Enterprise IT Struggles to achieve very modest gains, with executive purchase decisions captured between large cash holdings, increased Asian competition, and their own poorly performing customers. Although "big data" is the marketing cry, vendors in this market will find a general reluctance to spend. 2013 looks like another defensive year, except for the security segment, with no serious enterprise Windows 8 adoption and not much else going on. The screws are already tightened.
 

IX.           "Hacktivist" efforts acquire an important and permanent role in political transparency, moving from the level of annoyance to becoming an important, long-term part of the international political and security landscape. Nations and leaders hoping to hide the truth from their constituents will have to give up this option, paving the way for a new era in reluctantly open governments.

X.               Supply Chain Security Becomes a Major Factor in Global Technology Purchases.Starting with the high-security risk offerings from Huawei, the feeling of cyber unease on the part of inventing nations grows, and has a material effect on vendor market share among countries that can afford to prioritize their infrastructure security over short-term price advantage. Recognition that today's supply chains are virtually all compromised will lead to plant relocations and a new set of business opportunities for onshore component makers.

Quotes of the Week

"I find it very troubling that Abe is trying to insert his revisionist agenda into the electoral program of the LDP. Not only in calling for revision of the Constitution but also in demanding significant changes to education policy regarding the wartime past." Daniel Sneider, director of Stanford University's Nationalism and Regionalism project, on the platform Shinzo Abe plans to institute after being elected December 16th.

   "This is a huge passing of the torch." Javier Corrales, political science professor at Amherst College; on Chavez' naming of a successor prior to his cancer surgery this week in Cuba; quoted in the New York Times.

   "The closing of this transaction will mark the full resolution of America's financial support of AIG with a profit to taxpayers of $22.7B to date. It marks one of the most extraordinary and what many believe to be the most unlikely turnarounds in American history and you did it." AIG CEO Robert Benmosche, on paying back all TARP debt; quoted in the Seattle Times.

   "No taxpayer should be pleased that the government had to rescue this company, but all taxpayers should be pleased with (the) announcement, ending the largest of the government's financial industry bailouts with a profit to the Treasury Department." James Millstein, former Treasury official who oversaw AIG's restructuring from 2010-2011; quoted in theLA Times.

   "We think we have structured this transaction to address potential national security concerns." A123 CEO (and SNS member) David Vieau; on Chinese firm Wanxiang buying his company, a leader in lithium battery technology for electric cars; quoted in the New York Times.

Really, Dave? Really?

   "You can even say the Samsung Chairman is more powerful than the South Korean president. Korean people have come to think of Samsung as invincible and above the law." Woo Suk-Hoon, host of a popular economics podcast in South Korea; quoted in the Washington Post.
 

   "Many Koreans right now have dual minds about the chaebols. They say, 'I hate chaebols, but I want my son to work for one.'" Lee Cheol-haeng, Federation of Korean Industries, a large-business lobby; ibid.

   "Samsung has the government in its hands. Samsung manages the legal world, the press, the academics and bureaucracy." Lee Jung-hee, Liberal presidential candidate not favored in the coming election; ibid.

   "Europe is almost like a second home market for us." Roland Sladek, spokesman for Huawei; quoted in the NYTimes.

All those 30,000 fired Nokia Siemens Network employees that your half-price bids created in Finland will be glad to hear it.

   "He owes me a big dinner." Gary Parsons, on shepherding spectrum into the hands of DISH chair and CEO Charlie Ergen, approved this week, for the first time, for use transfer from satellite to cellphone.

   "Chinese merchants will still be able to use Google Shopping to reach consumers in other markets. But Shopping in China was not providing businesses with the level of impact we had hoped." Google press statement on shutting yet another failed non-Chinese online service, with Alibaba Group winning this battle; quoted in the Wall Street Journal. See main text.

   "We must not only develop confidently, but also preserve our national and spiritual identity, not lose ourselves as a nation. To be and remain Russia." Russian president Vladimir Putin; quoted in the Wall Street Journal.

And yes, we talked about this in New York last week and wrote about it in the main text, before the quote was made. This quote underlines the comments made above on Putin seeking a nuclear glue for Russian patriotism.

Upgrades

» Not Your Father's Pyro

For those of you who just haven't had the time to investigate pyroelectric nanogenerators yet, here is your chance to get going. Known as PENGs, these little items are made to harvest energy from the environment over time, and can convert that energy into useful forms for things like charging batteries.

Think about that for a moment.

There is a new and fast-growing area of research into the idea of energy harvesting often (so far) in small amounts, but the work is young.

Ask yourself: what does an ice cube do? No, not cool your cocktail; it actually is a perfect machine for harvesting energy from the environment around it.

In the case of PENGs, things are more complex, and more productive.

The basic idea is simple: selected anisotropic materials change polarization as external temperature changes. Because they are crystalline, the displacement creates an increased voltage across the material, and this voltage can be used to power external facilities. 

The result is that thermal energy changes in the environment over time can be used to drive devices and batteries.

All of this was encased in work announced this week by Ya Yang and Sihong Wang from the Georgia Institute of Technology and the Chinese Academy of Sciences in Beijing, and Zhong Lin Wang from both institutions, who found a way to use nano-scale materials to create perhaps the first near-commercial application of this new technology. Their work was published in a recent issue of Nano Letters.

We should expect to see a rapid increase in research and results in both the areas of energy harvesting and pyroelectric technology. The former will find applications everywhere, and the latter is likely to provide many of these solutions.

Takeout Window

» Pyroelectrics

          A Pyroelectric NanoGenerator:

(Above left) The PENG; (Center) The PENG powers an LCD for more than 60 seconds; (Right) A green LED is powered by a Li-ion battery that was charged by the PENG.

          A Pyroelectric Sensor:

Ethermail

Re: "SNS: Predictions for 2013"

Mark,

It's a simple presumption: any Chinese purchaser is the Chinese military. 

Are we comfortable having them own whatever is being bought? Maybe we should also ask if China would let our military buy the analogous company in China?

<https://finance.yahoo.com/news/china-spending-u-acquisitions-record-083700285.html?l=1>

Bill Lohse

Founder, Pivot Conference
NYC

Mark,

Subject: Huawei in Finland...

Mark- in case you did not see this

Dan Elron

VP of Strategy
Accenture

Dan, 

Now that Huawei has stolen Cisco's router IP, and used it and government assistance to bid for government telecom contracts at half price in the EU, it is hoping to move into the West's cellphone markets. To do this, it will need much more and better IP.

Nokia Siemens Networks is laying off 30,000, almost directly as a result of the above price wars, which as a company with real R and D costs, could not price-match against Huawei, as Merc Wave 3 comes over the bow.

At the same time, Nokia's prior handset business, greatly suffering through a combination of bad management moves in the smartphone world and bruising competition from Apple and Samsung, is also taking a dive. 

I think Huawei is putting its new center near Espoo to pick up Nokia IP for its planned expansion in the phone business.

A Western company would say, Let's invest in R and D so we can enter this new business. It would appear that Huawei's approach is: Let's steal some more IP so we can enter this new business.

I doubt the Finns have any better idea of what they are getting into than the British did a few years ago, when they bought all of that equipment they are secretly ripping out even as you read this.

Thanks for writing in. 

Mark Anderson