ERICSSON BULLETIN
No. 7 PAGE No. 3


Jubilee Year
JULY 1935

Their Majesties’ Jubilee encourages one to indulge in reminiscence - that is the only excuse we offer for what follows and in this spirit we would like to tell something of our history and of the circumstances which have led us to our present position, after a journey lasting 55 years to the present time.

We do not propose to trace the story of the telephone from the days of Graham Bell, the “father of the telephone.” This has been told so often that the facts are familiar to all. Soon after Bell demonstrated his sample instruments to the British public in 1878, several small companies were formed in this country to exploit the telephone but no serious or adequate steps were taken to provide a public service until the National Telephone Company was formed. That Company steadily built up a system throughout the country which, in 1912, was transferred to the State for a sum of twelve million pounds.

Like so many other large industrial ,concerns, the Ericsson s beginning was very small and passed unnoticed in a busy world. Its subsequent expansion has been rapid and extends to the five continents.

L. M. Ericsson's original workshop in Stockholm (1876)

Lars Magnus Ericsson was born at a small village in central Sweden on the 5th May, 1846. His parents were in very humble circumstances and his path was not smoothed by the death of his father which forced him to seek work at the early age of twelve. Fortunately he was a lad of great originality of thought and strength of character and what he lacked in the good things of this world he sought to acquire by diligent work and spare-time study. At the age of twenty he decided to try his fortune in Stockholm, where he secured work with a firm of instrument makers. Six years close study, allied to his natural ability, secured for him a government scholarship and enabled him to acquire wider experience and training. At 30 he laid the foundation of the present world-wide Ericsson organisation. Somehow or other, he secured a capital of £55 (the present capital of the Ericsson group of companies totals millions of pounds).

Ericsson’s foresight, or genius, led him the following year into the field which was then being opened by the invention of the telephone in America. At first he conducted his work in the kitchen of his small house, but after a few months the demand for his handiwork encouraged him to procure additional accommodation which he secured in a courtyard near the cattle market in Stockholm. Throughout their long lives together his wife’s advice and help were a tower of strength to Ericsson and in those early days, when his time was fully occupied making telephones, his wife would wind the coils on her sewing machine and in between this and her housework she also found time to keep the account books.

In 1879 Ericsson again had to seek larger quarters and from this time it can be said his enterprise emerged from the handicraft to the industrial stage. Hitherto, in addition to experimental work with telephone instruments, he had also been making telegraph receivers, fire alarm equipment and measuring instruments. With the commencement of the Stockholm telephone net-work in 1880, Ericsson concentrated more upon the telephone. He designed one which experts of that time declared superior to the American ones and the telephone material used in Sweden became exclusively of Ericsson manufacture.
It is appropriate to comment here upon the act that the modern trend of telephone instrument design has been to revert to he hand-microphone, the original manufacturer being Lars Magnus Ericsson more than fifty years ago.

The National Telephone Company readily appreciated the sterling merits of the telephone equipment made by Ericsson and a steady flow of orders resulted. Compared with present day standards these were infinitesimal, nevertheless they were of great
importance to Ericsson in those days. Mr. Dane Sinclair, who was at that time Engineer-in-Chief of the National Telephone Company and subsequently Chairman of British Insulated & Helsby Cables Ltd., visited Ericsson in order to examine the possibilities of securing a greater output of these coveted telephones and promised an order for 300 instruments if special efforts were made regarding delivery. An order of this magnitude had never before been dreamed of by Ericsson and it may be supposed that it caused him much thought and head-scratching. By utilising all his resources he was able to offer 10 per week; this however, didn’t suit Mr. Sinclair, who wanted no less than 50 per week. The result was a further extension of premises and plant. Events have shown that this order undoubtedly helped materially in the building up of the Ericsson concern, and since then millions of Ericsson telephones have been installed in all corners of the world.

Ericsson insisted upon a very high standard of workmanship from his employees. He personally inspected every piece of
apparatus before it left the premises and woe betide the man who put an inferior piece of work before him. It has been said that this would cause him to fly into a temper, with the possibility of the offending article being thrown at the head of the defaulter. This may be an exaggeration, but the exacting demands made upon the employees laid the foundations of Ericsson’s business upon a solid basis, which succeeding generations of Ericsson men constantly endeavour to uphold. It is no platitude to say that the name Ericsson conveys to the telephone world a guarantee for an article reflecting both care and skill in its production.

By 1889 the Stockholm telephone factory had achieved an output of 20,000 telephone instruments and the total number of employees had increased to 96, including Ericsson himself. 

In the early nineties, Ericsson directed his attention to the export markets and branches were opened in countries near to Sweden and later-on a chain of factories was built covering nearly every country in the old world.

In 1903, after 30 years incessant and fruitful labour, Ericsson withdrew from the leadership of the great organisation he had founded and retired to an estate in the country, where during the next 23 years he was afforded the great pleasure and privilege of seeing the extraordinary expansion of the Ericsson organisation. This remarkable and lovable man died in 1926, in his eightieth year, and by a strange coincidence at the time the Company was celebrating the half-century of its existence.

This brings us more particularly to the British section of the Ericsson organisation. A sales office had been opened in London in 1898 but in the early days of the present century it became evident that manufacture would have to be undertaken in Great Britain in order to satisfy the reasonable national desire for production at home. Messrs. Ericsson therefore decided to erect  a factory in London and with this intention they bought a plot of land at Tottenham, in the north. About the same time the National Telephone Company had purchased a factory at Beeston, just outside Nottingham - incidentally it was in this factory that the famous Beeston Humber cycles were originally made. The National Telephone Company made a proposition to Ericssons’ which caused them to abandon their factory project. This change of plan deprived the good people of Tottenham of what has proved to be a very successful venture giving steady employment to thousands of people; nevertheless, they had good reason to be grateful to Ericssons’ in other respects. The parcel of land was of considerable size, and a lot of timber was required to fence it - this timber became the main source of fuel supply to the district; no sooner was it erected than it disappeared and it became a race as to whether the erectors could put up as quickly as the Tottenhamites could pull down. We believe it was in this way that the name Tottenham Hotspurs originated!

Ericsson assisted by his wife experimenting at home

At the suggestion of the National Telephone Company a new Company was incorporated in 1903 under the name The British L.M. Ericsson Manufacturing Co. Ltd. The Capital of this Company was equally subscribed by the National Telephone Company and by Ericssons. The Beeston telephone works, employing at that time 130 people and covering one acre, were transferred to this Company. (Going back a little, it is interesting to recall that the first telephone exchange in Nottingham was opened in 1881 with two subscribers - it is safe to assume that "wrong number" or "number engaged" were phrases not then known in the district.)

Extensions to the Beeston works have subsequently been made at very frequent and regular intervals so that to-day about 15 acres are built upon and a further 8 acres are available for expansion. As extensions are at the moment being erected, it looks as though the remaining unoccupied land will not be more than the Company will require in the future.

As we have already mentioned, the business of the National Telephone Company was acquired by the State in 1912. This necessitated the repayment of their share holding in the British Ericsson Company, consequently the share capital of the Company was reconstructed. The capital was increased from £100,000 to £200,000 by a public issue of shares. The business continued to expand considerably and a Debenture issue of £100,000 was made a little later, while in 1926 it was again found necessary to increase the share capital, this time from £200,000 to £500,000 at which figure it still stands. At the same time permission was obtained to change the Company’s name to Ericsson Telephones Ltd.

When Shakespeare made one of his characters in Macbeth say “if you can look into the seeds of time and say which grain will grow and which will not, speak then to me,” he was voicing a wish that frequently occurs to each of us, but he knew, as we know, that the gratification of this desire would remove the zest from life. The journey is invariably more thrilling than the arrival. Ericsson did not realise that the seed he was planting in that back kitchen was destined to become an organisation giving employment to upwards of 12,000 people and even now the high water mark is yet to be reached. Saturation point in the demand for telephones is a long way off - in all countries of the world a considerably greater telephone density is urgently demanded and nowhere more than in the enterprising countries of the British Empire owning allegiance to their Majesties King George and Queen Mary.

 

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Last revised: April 22, 2003