Telephones catch on in Stockholm
The emerging industrial society's need for expanded and faster communications was a prerequisite for Ericsson and Stockholms Allmänna Telefonaktiebolag's operations. The new telephone naturally had to compete with established means of communication, such as the post and telegraph services. In relation to its population, Stockholm was for some time one of the world's leading cities for telephones, and it is also interesting to note that telephone services achieved a breakthrough in Sweden more rapidly than in other countries.
In Sweden, the number of telephone calls thus surpassed the number of letters as early as the beginning of the 1890s. This would take much longer in other countries. By 1910, telephone calls accounted for more than 70 percent of all messages in Sweden, while letters accounted for just over 26 percent. At that time, telephone calls outnumbered letters only in Scandinavia and the US. In other industrialized countries, the share for telephone calls was less than 30 percent.
What were the factors behind this development? The rapid spread of the telephone in Stockholm was due in part to SAT's stated goal of equipping every household with a telephone. While this goal was not achieved, low tariffs made the telephone more popular in Stockholm than anywhere else in the world.
An important contributing factor was that Televerket, the Swedish PTT, took the initiative in the 1890s and began to compete with SAT. Competition forced the two companies to exploit technical advances in telephony to reduce operating costs. This meant that telephone call charges were lower in Sweden than in many other countries and that they were lowest in Stockholm. This was the main reason why Stockholm became the city with the most telephones per capita in the world. By the early 1900s, it was also possible to say that no other country had achieved as democratic a spread of telephones as Sweden.
The fact that Televerket remained an autonomous body that was not, as was the case in virtually all other countries, joined with the postal service also contributed to a rapid expansion of telephone services, particularly in the nation's capital. In other countries, authorities continued to protect the interests of the established postal services at the expense of the new telecommunications medium.
Yet another factor in the early growth of telephony was that this growth only partially benefited Ericsson as a supplier of telephone equipment. Televerket, which originally purchased equipment from Ericsson, began its own manufacturing, and SAT also opened its own telephone production plant.
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