There was, however, to be no honeymoon for Televerket after its launch of mobile telephony. An aggressive competitor emerged the same year, 1981.

The history behind this real challenge to Televerket is a long one. The company that started mobile telephone traffic in southern Sweden in 1965, Wikanders Ur & Optik, had after many agreements and mergers with other small private operators, been bought up by Svensk Kommunikationskonsult (SKAB) in 1979 and changed its name to Företagstelefon AB. A year later, this company bought out its largest competitor, Nordiska Biltelefonväxeln, which provided it with some frequency bands and a total of 1,900 subscribers. But the acquisition overstretched Företagstelefon's finances, and in September 1980, it had to be rescued. The company was acquired by Kinnevik and reincorporated as Comvik. The majority owner was Swedish entrepreneur Jan Stenbeck.

Stenbeck’s ambitions extended well beyond Sweden. Together with American Shelby Brian, he helped start Millicom in the US in 1979, with the idea of applying for the licenses for mobile telephony that the FCC was eventually expected to offer for tender. As these were not yet forthcoming, Stenbeck invested in Sweden. In October 1980, Comvik applied for a permit to operate an automatic mobile telephone system with the frequencies used by Företagstelefon.

Televerket turned the application down, one of the arguments being that the NMT system was soon to open. Comvik appealed and was given the right to connect its system to the public telephone network – on the condition that the mobile network was operated manually. In the spring of 1981, Comvik gained Televerket approval for its manually operated radio exchanges: the specifications have been described as so stringent that the agency’s test equipment could not always cope. Embarrassingly, Comvik managed to start its mobile telephony a week earlier than Televerket.

COMPETING MOBILE OPERATORS

This meant Sweden was the first country in the world with competing mobile telephone operators.

A series of conflicts followed which led to a constant barrage of appeals and writs. Naturally, it did not suit Televerket that Comvik was focusing on low tariffs and subscribers in the densely populated Stockholm region. And to top it all, the Swedish Market Court ruled against Televerket in a case dealing with an advertising war going on at the time. Televerket’s accusation that Comvik was surreptitiously using an automatic exchange attracted no little attention: the allegation was that the exchange was being operated “pseudo-manually” with the operator pressing a button merely for appearance’s sake.

Televerket had a staunch ally in this battle: L.M. Ericsson’s CEO, Björn Svedberg. He wrote to the government to point out that rapid development of the NMT system was also important for L.M. Ericsson and would help guarantee employment in Sweden.

Thomas Beijer, one of Thomas Haug’s colleagues at Televerket in the 1970s, comments: “The atmosphere between the competitors was really bad.”

Nevertheless, the rivals were negotiating in great secrecy. Televerket had several hundred exchange operators who would lose their jobs with the impending closure of the MTD system. The question was whether Comvik could take them on and use them to provide advanced secretarial help to companies and other clients. The condition was that Comvik would use the NMT network to do so – and at the same time give up its own. “The collaboration collapsed just before the finishing line,” says Bo Magnusson, who was responsible for terrestrial mobile services at Televerket Radio at the end of the 1970s and all of the 1980s.

Author: Svenolof Karlsson & Anders Lugn

© Telefonaktiebolaget LM Ericsson and Centre for Business History

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