Ulf J. Johansson describes Ericsson as a generous employer. That is how it was when he arrived in the company at the age of 18 in the 1960s, and it had remained so since then. Yet the turbulence tested his loyalty on numerous occasions, not least when the group management assessed things differently from those running the business areas.

During the 1980s, Johansson found himself at the interface between many worlds: fixed telephony and mobile telephony, operators and suppliers, state-owned telecommunications agencies and private enterprises. He could see that mobile telephony was in the process of creating undreamed-of markets and could foresee that new business opportunities could be developed one after the other. Many of them lay far from Ericsson’s domains but others were closer.

“Those of us working in the front line of mobile telephony saw where the technology was going. We had lived through deregulation and had learnt about the conditions that applied for the operators. And at ERA we were imbued with the entrepreneurial approach, so it was no great step to want to run your own operation.”

One interesting question for Johansson was of course which GSM operators would establish themselves in Sweden. Televerket was an obvious contender, and Comviq (formerly Comvik), owned by Jan Stenbeck, could be expected to apply for a frequency-division license to enable it to become the second operator. But why not get into the industry himself? Through his contacts with Tony Hagström, Johansson knew that Televerket would gladly welcome a competitor other than Comviq.

Johansson had received many attractive job offers over the years, and declined all of them. In the summer of 1989, he was offered the post of CEO and president of the Pharos Group, a listed spinoff from the Swedish AGA group that specialized in measurement technology. He met representatives of the main owners and also presented his ideas about the mobile telephone world.

ESTABLISH A NEW OPERATOR

Nobel Industries, the major stockholder in Pharos, believed in this idea and undertook to help with finance. In October, Johansson talked the matter over at a lunch in Nobel’s penthouse in central Stockholm with Anders Carlberg (CEO of Nobel Industries), Christer Zetterberg (CEO of PK-Bank) and others. He agreed to become CEO for Pharos on the proviso that he would be given support for his plans to establish a new GSM operator.

“The response was ‘Great idea! Go for it!’ This was when the finance bubble was still at its peak. Money was no problem,” Johansson says.

All that remained was for Johansson to take the step of leaving Ericsson. “Shortly after [the meeting mentioned above], I attended the kickoff outside Washington where Ericsson was celebrating its collaboration with GE. I informed Lars Ramqvist about what I was going to do. He patted me on the shoulder. ‘Bloody good,’ he said. ‘Now we can beat Jan Stenbeck [at Comviq] together with Tony [Hagström]’.”

In December a farewell dinner was arranged for Johansson. Ramqvist made a speech and hoped that Johansson would return to the company.

RAMQVIST NEW CEO

The following morning Ericsson held a press conference. This was to announce that Svedberg was retiring as CEO during the spring and would be succeeded by Lars Ramqvist.

The invitation to take over after Ramqvist as head of ERA went to Kurt Hellström, employed at ERA since 1984 and successful head of the company’s marketing in Southeast Asia.

The board had asked Svedberg to propose three candidates from which his successor could be chosen. They were Lars Ramqvist and the two deputy CEOs, Jan Stenberg and C.W. Ros. 

Author: Svenolof Karlsson & Anders Lugn

MOBILE SYSTEM AGREEMENT

Agreement on a mobile system for Albany, New York. From the left, the customer’s attorney Barry Adelman, Mats Ljunggren, Jim Regan, who represented the owner Western Union Cellular, and Leif Holm.

MOBILE SYSTEM AGREEMENT

This deal took place at the same time as McCaw’s purchase of ERA’s system for Sacramento and Fresno, two major cities in California. After extensive negotiations, McCaw’s technology manager Mark Nelson stood up and said: “Okay, you can have the order if you [Mats Ljunggren] promise to ski the Vasaloppet [ski race] with us.” Coming from Halland in the southwest of Sweden, Ljunggren had never even considered such a feat, but he agreed to do it because it was a requirement. McCaw’s attorney Barry Adelman had to write the contract – it took a year. The agreement was worded according to the same template as all mobile contracts with all their legal hair-splitting. The contingent completed the race in 1988 together with Mats Ljunggren’s then manager Manfred Buchmeyer, Jöran Hoff and Åke Persson as supporters. Hoff made sure Barry Adelman made it past the rope finishing line in Oxberg by simply lifting it.

© Telefonaktiebolaget LM Ericsson and Centre for Business History

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