There were distinct similarities between the launch of NMT and the launch of GSM. A test version of GSM demonstrated by ERA at the International Telecommunication Union exhibition in Geneva in the early summer of 1991 had been able to place 11,000 calls without any major technological problems. But only two operators were ready on July 1, the date set for the launch, not by the GSM group but by the EC.
ERA received its first GSM order in 1988 from Vodafone in England, but the major starting shot came with an order from Germany. A new operator there, Mannesmann, after tough competition with other applicants including Sweden’s Televerket, had received a license for a GSM network. Ericsson had never had any operations in Germany, but now, in competition with 10 or so tenders, ERA managed to win the contract to build Mannesmann’s network. The order was prestigious and substantial.
RACE AGAINST THE CLOCK
Again it was to be a race against the clock. For ERA, it was a case of having the network ready on time; for Mannesmann it meant acquiring customers.
It also turned into a struggle between Mannesmann and Finland’s Radiolinja about who could claim to be the first GSM operator.
Radiolinja had its roots in the small and medium-sized telephone companies that had been competing through the years with the Finnish national telecommunications agency. Kurt Nordman was then the CEO of the largest private telephone company, Helsingfors telefonförening (the Helsinki Telephone Association), which had originally been founded by Daniel Johannes Wadén – the engineer who had first competed with Lars Magnus Ericsson and then became the Ericsson representative in Finland. Nordman recalls: “We wanted to be able to compete in mobile telephony as well but the agency would not allow us into the NMT market. In August 1988, I lost my patience and began to take action.”
Nordman persuaded banks, insurance companies, wholesalers and others to become stakeholders in Radiolinja and began the battle for an operating license. For two years the two major Finnish political parties, The National Coalition Party and the Social Democrats, fought over the issue. Victory eventually went to the former, which meant that Radiolinja received its license.
“We ordered our GSM network from Nokia in 1989. This meant we were taking a risk. Nokia did not have a system ready and we had no license,” Nordman says.
Author: Svenolof Karlsson & Anders Lugn
