In 1905, Ericsson took over a concession for telephone operations in Mexico City and the immediate vicinity. The concession was originally acquired by José Sitzenstatter. Initially, the operations were run as a consortium of various financial interests. In 1909, the operations began to be run within the newly formed Mexikanska Telefonaktiebolaget Ericsson company, which in Spanish was called Empresa de Teléfonos Ericsson SA. Here, we will refer to the company as Mexeric.
When Ericsson began its operations in Mexico, another company had been in operation since the 1880s - the Mexican Telephone and Telegraph Company, or Compania Telefónica y Telegrafica Mexicana SA. For simplicity's sake, we will call it Mexicana.
The companies soon entered a situation with the most intense competition possible. Of the two, Mexeric grew fastest. After ten years of operation, it had a larger number of subscribers than its competitor. This can partly be explained by the fact that the American company, unlike Mexeric, was confiscated by the state during the troublesome decade experienced by Mexico after 1910. Mexicana was in state hands until 1925, when the American International Telegraph & Telephone Corporation (ITT) took control of the company. This was the starting shot for the return of intensifying competition between Mexeric and Mexicana.
In Ericsson's archives, there are a number of reports that were sent from the Mexican subsidiary to the head office of the parent company. Most of these reports contain the heading "Mexicana". Not only is it possible to read about the actions of the competitor, but also the methods adopted by both sides to win the battle for subscribers. In 1929, engineer Hugo Lindqvist, Mexeric's President, sent a report in which he wrote that all the lines on the Local District line had been cut down on two occasions, a telegraph pole had been knocked down leading to a breakdown in service and that another pole had been uprooted and dragged 200 meters. As a result, Hugo Lindqvist had contacted the Minister for Communications and had placed advertisements in the newspapers. He hoped that if Mexicana's unfair methods were revealed, the company would appear in a bad light.
Mexeric had, at least periodically, the support of the authorities. Hugo Lindqvist reported to Karl Fredrik Wincrantz, Ericsson's president, about a meeting he had with the head of the labor ministry in December 1929. The minister had provided valuable information on that occasion, including the fact that after Mexicana had introduced an automatic system, the company had been forced to dismiss a number of employees and had lost a large number of subscribers - as much as 20 percent. According to the Minister, the general public preferred the manual system that was still largely being used by Mexeric. Mexicana's employees had also pointed out to subscribers during the installation of the automatic system that the service would be extremely poor.
Lindqvist received this information "partly because he (the Minister) regarded it as his duty to counter North American influence and partly because he wanted to help me personally". Lindqvist took the information with a generous pinch of salt. In order to really find out what people thought about the automatic system, he decided to dispatch "Secret Svensson's henchmen" on reconnaissance. One wonders who these henchmen really were.
Among its employees, Mexeric had an English-Spanish secretary, Mrs Bardet. She had met a senior manager from Mexicana at a party and he had offered her a large sum of money to provide some information about Mexeric. Mrs Bardet told Lindqvist the entire story. The two of them agreed that Mrs Bardet should arrange a meeting with the Mexicana manager at Mexeric's office the same evening.
Of course, Lindqvist was at the office to take care of the "guest". He was interested to know the visitor's business. As could be expected, he received no satisfactory reply to the question. Finally, the Mexicana employee said something about being interested in general data regarding the company, which would later be published. Lindqvist promised him these details, but pointed out that he would also be writing to the head of Mexicana to say that a public request should be made for the information. A copy of the letter was sent to Mexico's Minister for Communications.
Of the two companies, Mexicana appears to have been the provocateur. For its part, Mexeric seems to have been quick to tell tales to the state authorities.
Author: Krister Hillerud