At the start of the 20th century, the National Telephone Company in Britain
was a major customer of Ericssons. They imported large quantities of phones
and equipment from Sweden. Although National was a major user of equipment,
they were an operating company rather than a telephone manufacturer. As such,
they had to bear heavy political pressures from the British Post Office which
was lobbying to take over the telephone market for itself. The Post Office could
not meet the demand for phones, so private companies had been able to develop
services in many areas.
National was quite successful in building its own networks and buying out others,
and had standardised on Ericsson phones and Western Electric switching equipment.
By the turn of the century they were taking half the output from LMEs
Swedish factory, so when they proposed a joint venture factory with Ericssons to manufacture
phones in England, both companies saw the opportunities. Ericssons motives were
twofold. Their Swedish factory was unable to keep up the level of supply for
all its customers, and a new factory was needed desperately. Further, a manufacturing
presence in the U.K. would give them a political advantage for U.K. contracts
and the growing British colonial markets. The joint venture with their biggest
British customer would give the firm a local flavour that the Americans would
not be able to match.
National already had a factory at Beeston in Nottingham in 1901, where it was
doing research, repairs and refurbishment rather than building phones. The factory
employed 130 people, compared with under 100 at Ericssons' Swedish factory.
In 1903 the Beeston factory was taken over by the new company , the British
L M Ericsson Manufacturing Co. Ltd. It was owned equally by National and Ericsson.
With unfortunate timing the British Government decided in 1905 that Nationals
license to operate would terminate in 1912. The firms customers and assets
would then be bought out by the Post Office.
The Beeston factory, however, was a commercial success. It had to be expanded
in 1906-07 to cater for the demand. This expansion would have been largely funded
by Ericssons, as National had now reverted to a holding operation until its
license expired. It would not invest money in an operation which would not return
an immediate profit. In 1911 Ericssons finally bought out Nationals share
of the factory. Although no longer selling to National, it was producing large
amounts of equipment for the now enlarged British Post Office.
Beeston continued to grow, and in 1925 the capital was increased by sales of
shares from two hundred thousand pounds to half a million pounds. The money
was used to upgrade the factory for the manufacture of automatic telephone exchanges
as part of the British Post Offices automation plans. The name of the
company was also changed to Ericsson Telephones Ltd in March 1926. The local presence
paid off, as Ericssons got the largest share of the BPO contracts. The exchanges
were a Strowger design, and many were still in operation until late in the twentieth
This manufacture of another companys design was not unusual. Beeston had
been building equipment under contract for many years. In 1929 it even began
the manufacture of totalisator betting equipment for Britains racecourses.
It was designing its own phones to suit its wide markets. The company was allowed
a fair degree of independence from its parent, although there were two Swedish
representatives on the board of directors. During the 1930s Ericsson Telephones
Ltd was producing as much income as the parent factory in Stockholm.
In 1939, the Second World War broke out. ETL looked like it would be seized
by the Government under the Trading With The Enemy Act, if Sweden was invaded
by Germany. To avoid this, the parent company reduced its shareholding in
ETL to below 50 percent, and removed the two Swedish directors. During the war
Beeston produced radios for the R.A.F. and carried out repairs to exchanges
and equipment damaged in the bombing. By the end of the war the factory employed
5,500 people. It also sold equipment to many countries previously serviced by
the Swedish factory. It had become an independent entity, and was under very
little influence at all from its parent company.
In 1950 and 1951 the remaining Swedish shares were sold on the British market,
and all involvement in the firm by Ericssons ceased.
For a comprehensive catalog of British Ericsson phones, see
Bob Freshwater'sTelephone File website
Sources: The National Telephone Company of Great Britain Graham Marshall
L M Ericsson 100 Years Aatman Kuuse & Olsson
National Telephone Journal 1906 information provided by Linley Wilson
British Telephones Web Site and CD The Telephone File - Bob Freshwater
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