Introduction

Norway. If you have heard about it, it is probably because of oil, whaling or the high ranking on the Human Development Index, where Norway was on the top for six consecutive years. Despite having a population of less than 5 million, which is less people than other countries have in prison, it is the worlds third largest exporter of oil.

Being located in northern Europe, it is a somewhat cold place to live, and during winter it has some periods with little sun. It has a long, rugged coastline, and is also famous for its beautiful fjords. The terrain is rocky and mountainous, making transportation a challenge in some areas, and the airplane routes between the largest cities are among the ten largest in Europe.

This year, two large and multinational companies acquired two software companies from this strange and cold country.

Fast Search and Transfer

The first one to go was Fast Search and Transfer. FAST grew out of the Norwegian University of Science and Technology in Trondheim, a small city with around 160 000 inhabitants. At winter solstice, the sun is only above the horizon for four and a half hours. From May 20th to July 20th, there is no darkness, as the sun stays just below the horizon.

Already in the early years since it was founded in 1997, FAST had strategic alliances with large companies outside of Norway. In 2002 it was ranked number three on the 2002 Deloitte Technology Fast 500, which is a ranking of the 500 fastest-growing technology companies in Europe.

FAST specialized in search technology, and for a while also had a division for Internet search, but in 2003 it was sold to Overture, which was acquired by Yahoo! the same year.

FAST has now been acquired by Microsoft.

Trolltech

The second to go is Trolltech. The founders of this company studied at the same university that FAST grew out of. Trolltech makes a cross-platform application development framework called Qt, which has become midly popular. It is used in applications such as Opera, Google Earth, Skype and Photoshop Elements. They also have an application platform for devices, called Qtopia. In addition to that they also do development on Webkit, which makes them one of two browser makers in Norway, the other being Opera Software.

They have been successful at getting a lot of customers outside of Norway, such as Adobe, IBM, Sony, Google and Nasa, to mention a few.

Trolltech is in the process of being acquired by Nokia.

Stating the obvious

In addition to these, we have the worlds largest browser factory, Opera Software, and also Funcom, one of the leading independent game development companies in the world, with several critically acclaimed games.

So, it seems that we are doing something right, since we in spite of our low population have managed to create something that attracts attention far outside our own borders. You would think we have some kind of Silicon Valley here, but we don’t. However, we do have a lot of incentives to stay inside in front of the computer (cold weather, darkness). Clearly there must be something going on that can be used to build up a solid and profitable technology industry here.

Unfortunately, Norwegian investors seem to not agree on this, and are more than eager to dump their shares when a foreign company comes along and dumps a bag of money in their laps. Some might call it unfair to blame investors for trying to earn a buck, but why shouldn’t it be possible to build up Norwegian companies to be the ones who acquire companies in other countries?

It seems clear to me that it isn’t the technologists fault, but that the blame is on the immaturity and impatience of the investors.

In the aftermath of the announcements of the acquisitions of FAST and Trolltech, there were some articles about how sad it is that these are now in foreign hands, and complaints that the government did not do enough. If you’re from a non-socialist country, you might wonder what the government has to do with anything here. In Norway it is tradition that the government and political parties take strong interest in Norwegian companies, and even take steps to keep companies in the country. The shipping industry, for instance, has their own tax system - in fact there is no tax on profits, as long as shipping assets stay in Norway.

I see no need for government intervention when it comes to technology companies like FAST and Trolltech. First of all, it’s not that many jobs. The shipping industry, for instance, generates a lot more jobs. FAST has around 750 employees, and Trolltech around 250. Not all of those are in Norway, both companies have offices abroad, but of course it would be a shame if all the jobs in Norway were moved abroad. That is most likely not going to happen, because the wealth of these companies are in the employees heads, and if you want to move the wealth out of Norway, the heads will have to be moved as well.

People usually want to stay where they are, unless given a strong incentive. Remember, Norway is one of the best places to live, according to the HDI mentioned in the beginning. It might be a little dark, cold and expensive, though.

Of course, the profits that FAST and Trolltech generates will go to their owners, but if the knowledge stays in the country, then we are not that much poorer.

Change of plan

In May I will leave one great Norwegian software company to go back to another, albeit a lot smaller, great Norwegian software company. I hope neither can continue growing without being swallowed by a huge foreign company, but in the end that will be up to the shareholders to decide.