The Ericsson DBH15 telephone.

In the 1920s and 1930s, the world telephone markets were being organized and stabilized by many governments. The fragmented town-by-town systems which had grown up over the years, serviced by many small private companies, were integrated and offered for lease to a single company. Ericsson managed to obtain some leases, which was vital to the company as it represented further sales of equipment to the growing networks. The other large telephone companies, of course, had exactly the same goal. Ericsson managed to get almost one third of its sales under the control of its telephone operating companies.

There were a number of negotiations between the major telephone companies aimed at dividing up the world between them, but the sheer size of the ITT empire made it hard to compete with. With its financial problems, Ericsson was forced to reduce its involvement in telephone operating companies and go back to what it did best, manufacturing telephones and switchgear. It could do this easily now, thanks to its overseas manufacturing facilities and its associated supply companies. These had not been involved in the previous shady financial dealings and were generally in a sound position. The Beeston factory in Britain became a very useful asset here. It had been a joint venture between Ericsson and the National Telephone Company. The factory built automatic switching equipment for the BPO under license from Strowger, and exported a large amount of product to former colonies like South Africa and Australia. The British government divided its equipment contracts between competing manufacturers, but Ericsson's presence and manufacturing facilities in Britain allowed it to get most of the contracts. Ericsson equipment maintained its reputation for quality.^{[citation needed]}
Sales drives resumed after the Great Depression, but the company never achieved the market penetration that it had at the turn of the century. Although it still produced a full range of phones, switching equipment was becoming a more important part of its range. The distinctive Ericsson styles soon became subdued by the increasing use of moulded thermoplastic phones (Bakelite, etc).
Following the advent of football shirt sponsorship during the 1980s, Ericsson sponsored two English football clubs during the 1990s - Brentford and Queen's Park Rangers.

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