Nokia verus Ericsson
Nokia acted swiftly and moved to tie up spare capacity at other Philips plants and every other supplier they could find. They even re-engineered some of their phones so they could take chips from other Japanese and American suppliers. Ericsson, meanwhile, had accepted early assurances that the fire was unlikely to cause a big problem, and settled down to wait it out. When they realized their mistake it was too late: Since Ericsson a few years earlier had decided to buy key components from a single source to simplify its supply chain, Ericsson now had to face the bitter realization that it had no other source of supply. Nokia had already taken it all.Single sourcing may have its benefits, but it has its costs, too. Ericsson lost many months of production, and hence many sales in a booming market that could now be dominated by Nokia. Bummer. Eventually Ericsson merged with Sony in order to survive, and eventually I too had to switch back to Nokia.