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Ericsson AB is one of the leading suppliers of mobile systems globally. Ericsson was established in 1879 by Lars Eric Magnusson in Stockholm, Sweden, and is today present in more than 140 countries. The company is currently listed on the Stockholm Exchange, the London Stock Exchange and NASDAQ. Their business areas include mobile and broadband network infrastructure, application enablers, and access equipment and terminals. (Ericsson, 2005)
Ericsson's founder, Lars Eric Magnusson, started a small repair store for telegraphic equipment in 1879. Magnusson later moved on to telephone technology and switchboards. (Näringslivshistoria, 2005)
Ericsson developed their first mobile system MTA in 1956. The MTA system weighed 40 kilos and had to be transported in a car, with the additional batteries stored in the trunk. After the 1950’s there were little development within the mobile technology until the beginning of 1980. Saudi-Arabia was the first country to launch a functioning cellular system for mobile telephony in 1981. The system used by Saudi-Arabia was developed by Ericsson, and named NMT. (Näringslivshistoria, 2005)
The mobile technology experienced a more rapid development throughout the 1980’s due to the deregulation of the telecom market in many western countries. In 1981, Ericsson made the decision that they would be providing complete systems within mobile technology, including mobile phones. However, mobile technology was not defined as one of Ericsson’s core areas until 1986 and the mobile phone did not achieve the status of a core product until the beginning of the 1990’s. (Näringslivshistoria, 2005)
The first generation mobile phones, 1G, which Ericsson developed was based on the analog systems NMT, AMPS and TACS. Hotline was a popular model launched in 1987. The miniaturisation of the different components in the phone started with Hotline and made it possible to make the phones smaller and more portable. (Näringslivshistoria, 2005)
Ericsson’s second generation of mobile phones, 2G, was introduced first time in 1992. These phones were handheld. The second generation of mobile phones was a move into digital systems, and GSM and TDMA were the two first digital systems they produced. From the middle of the 1990’s Ericsson started to develop different phone models in a rapid speed. The personalised mobile phones, with different covers and ring tones, were introduced from the late 1990’s. GF788 was Ericsson’s first model with a flip cover and was launched in 1997. WAP, Wireless Application Protocol, and GPRS, General Packet Radio Service, were two of the typical 2G features, in addition to SMS. By 2000 Ericsson produced 2G phones for five digital and two analog standards, in addition to dual-band phones who could handle two frequencies (Näringslivshistoria, 2005).
In 2000 the overall telecom sector went into a recession, and Ericsson was among the companies who suffered strongly from this. Ericsson went through 11 quarters with negative profit. The solution for this crisis proved to be a stronger focus on 3G technology and the outsourcing of mobile handset operations to the joint venture Sony Ericsson. (Strategic Direction, 2004)
Due to the fact that many major mobile phone service providers postponed their planes on launching 3G in 2002, Ericsson struggled financially for a longer period of time (Pringle, 2004). However, today 40% of all mobile calls are made through Ericsson’s system, and this makes them one of the world’s largest mobile technology system providers (Ericsson, 2005). Ericsson is today offering systems for all major mobile communication standards, as the only company in the world. Their solutions are implemented across the world. In June 2005 the revenue from Eastern Europe, Middle-East and Africa exceeded the revenue stream from Western Europe (Alpert, 2005).
In their annual report for 2004, Ericsson state that they will continue to focus on the development of high capacity 3G mobile systems (Ericsson, 2004). Their strategy for the future consist of the following five elements: 1) to lead the development of wireless technology, 2G, 3G and beyond, 2) to drive complete solutions through their end-to-end expertise, 3) to create more efficient and flexible networks using IP and IMS, 4) to expand their leadership position in professional services, and 5) to innovate in order to develop the market leading products and services of tomorrow. Their aim is to be the prime-driver in an all-communicating world (Ericsson, 2004).
See also
Reference list
External links
Ericsson AB
Näringslivshistoria - Centre for Business History in Stockholm
Yahoo – Ericsson AB company profil
--Kristine Bjoernstad 21:14, 1 Sep 2005 (EST)
