‘Far better is it to dare mighty things, to win glorious triumphs, even though checked by failure…than to rank with those poor spirits who neither enjoy much nor suffer much, because they live in a gray twilight that knows not victory nor defeat.’
It Started With a Call
December 13, 1982 – My offices, Wall Street
Every good saga should begin with an event, a moment that sparks off the drama and excitement to follow.
This one begins with an unexpected phone call. There are three of us in the room and it interrupts our discussion.
“Is Orhan with you?”
I hand the phone to Orhan Sadik-Khan.
Outside the traffic on Wall Street is flowing as well as it ever does. Inside, the dull hum of fluorescent light fills the moments of silence.
Orhan listens intently. He asks a question or two. The call is short. He hands the receiver back to me.
“Parliament’s just approved our application,” he says matter-of-factly, before his face cracks into an irrepressible smile. “They’ve awarded us the license.”
I’m stunned. “For England?”
“For the whole of the UK.”
It was the moment that turned our telecoms minnow into a giant global force.
Today, the firm that would later become Racal is now Vodafone, the phone company of choice to over 400 million customers – more than five percent of the planet’s population – and one that’s valued at some $370 billion.
Only a handful of companies in history have ever been worth more. But while it took General Electric a century to get there and Apple Computers 35 years, at Vodafone we managed it in just 18.
In doing so, our little start-up was the catalyst for a revolution that’s spread faster and further than anything else ever before witnessed – cellular telephony.
That this was made possible at all is because the company’s founders recognized the importance of advances in radio and semiconductor technology, and followed their instinct and imagination in a quest, quite literally, to conquer the world.
The result was a transformation of the telephone communication and information distribution industry.
Back then in 1982, to even contemplate such things would have seemed absurd.
To achieve that, not only would our minuscule company have to declare war on huge monopolies and persuade governments everywhere to ‘free up the air’, but it would also have to build strategic alliances with appropriate partners and create massive networks in all parts of the world.
But this is is the story of how all of that actually happened, of how the impossible became reality. It’s a story that’s never been told before and in the process has required some forensic analysis of the evidence, a picking over of the bones.
The Saga Begins
I’m writing this as a modern-day saga because it is the story of how, through their efforts, a small band of committed, determined people had a massive, formative impact on the world as we now know it.
Did they possess some secret weapon? Could others use their playbook as a guide so that they too can explore deep, dark, uncharted business waters?
As I was there from the start, I’ve taken it upon myself to be the chronicler of the tale, recalling as best I can who did what and when, in the hope others may learn and be inspired, to ‘dare mighty things’ and to find wisdom – even warnings – in the pages that follow.
The Genesis of Everything
It’s thanks to Jay Light, that I became a telecommunications industry devotee. He was my professor at Harvard and then soon-to-be-Dean, who graded his students, including me, on the performance of a portfolio of communications stocks during the semester.
In a risky bet that spookily presaged my later career, I placed 95 percent of my hypothetical money in MCI, then watched the stock double in just four months.
Looking back, I got lucky, but that early success marked me out as a telecoms man.
So I started to look for a way into what I believed would be the business of the future, making it a habit to pore over telecom trade publications.
In the summer of 1982, I spotted an article that contained a striking idea – ‘phones without wires’. Intrigued, I cold-called the executive quoted in the piece, an Englishman called Peter Erb.
“I think I can help your business,” I said.
“What do you do?” asked Peter.
“I help young companies get started; fill in the missing pieces, raise money. It’s a pretty comprehensive approach,” I said … somewhat pompously.
“We should meet,” replied Peter.
It was a call that was to put me on the inside track of the as-yet-infant mobile phone industry.
The Honeycomb Explained
Peter Erb is a computer executive with a gold trader’s mentality. In earlier times, he might have made a great pirate. Barrel-chested, swashbuckling and brash, he was relishing shaking up the hidebound telephone industry. And just a couple of days after our call I was in New York City, listening as he explained the results of recent cell phone tests in Raleigh-Durham, North Carolina – he wasn’t shy about extolling its virtues.
“What we’ve created is a new communications system,” he enthused.
“Let me tell you how good it is.” He paused for effect. “We are one of only three firms to get a cellular development license from the Federal Communications Commission. And as our system’s already up and running at our sister company in Sweden, we know we can roll this out.”
“What’s the projected size of the market?” I asked.
“We’re talking 50 to 60 million over the next 20 or 30 years.”
Just imaginary numbers or the start of something very big?
A week later, I’m back with Peter in my dark, wood-panelled office in Wall Street, this time Orhan Sadik-Khan is with us. Having just left abrasives company Norton Simon, he’s now consulting for young companies. Born in Afghanistan and educated in Cairo, Orhan is toying with the idea of becoming CEO.
With a sparkle in his eye, Orhan conveys a firm confidence. He also looks like my father – the same weather-beaten face, the same pursed lips. We immediately feel a kinship and he starts calling me ‘Tiger’ right away. It was this, and a tendency to punctuate sentences with his signature question “You see?” that defined our conversations.
Though Orhan is still ‘checking out’ this opportunity and is not as yet fully on board, he too is quick to enthuse about its potential.
“It’s the ‘honeycomb’ effect that makes our approach so revolutionary,” he explains. “You see, as subscribers sign up and our network grows we just add another cell to accommodate them – just like in a bee hive. And unlike traditional landline phone companies, we can match our build-out expenditure to the number of customers.”
“Best of all,” Peter cuts in, “we can offer more than just voice. We can put data on a phone too and for a computer man like me, that’s exciting.“
“What kind of data?” I ask.
“Anything. Weather. News.” Peter’s getting into his stride. “Messages left when you don’t answer your phone. Services we haven’t even dreamed up yet.”
A voice and data wireless phone? I was hooked.
“Sounds pretty well thought out. Where did the idea come from?”
Peter and Orhan look at each other, then back at me.
“Sweden,” says Orhan, “from a man called Jan Stenbeck.”
The Vikings had landed.