Chairman Lars Ramqvist, Nilsson's outspoken predecessor, will take back his old job as CEO, while the presidential slot will go to the soft-spoken Kurt Hellstrom, vice president for the Asian-Pacific region.

Ramqvist said Nilsson failed to push through rapid reforms, even as the long-term strategy he developed for Ericsson will remain in place. "We have certain problems," Ramqvist said. "We have to come out with more new products and we need to do it faster. We need to step up the pace of restructuring."

For his part, Nilsson said he couldn't execute his plans swiftly enough because he couldn't get along with the company's top management and faced resistance to change from within the organisation. "The chemistry between me and the chairman was not at the very best," said Nilsson. "That made things difficult." Headmitted he would've liked to continue in the post.

To be sure, Nilsson's reign has been a tough period for Ericsson. The company saw arch-rival Nokia Corp of Finland take over its lead position in global mobile-phone sales and Nilsson issued a surprise profit warning last December that abruptly sliced the company's share price in half - only to climb back slowly to previous levels recently. The release of new mobile phones were repeatedly delayed last year, while several models were recalled because of technical problems.

What's more, as Nilsson came to the helm of the company, rivals in the data-communications arena such as Nortel Networks Corp and Lucent Technologies Inc started gobbling up Internet-technology companies at a dizzying pace - a trend that Ericsson picked up only slowly and never fully embraced. Instead of buying major Internet companies, Ericsson pursued its so-called "string of pearls strategy" of buying a handful of tiny Web-technology concerns, but relying mainly on organic growth.Such technology is important to Ericsson because the next generation of mobile phones and other telecom products will rely on wireless access to the Internet.

During his time at the top, Nilsson never gained the full confidence of the market. Analysts said Ericsson wasn't transparent enough about its problems and developments, while Nilsson appeared awkward and hesitant in public when talking about the company's disappointing results in the autumn of last year.

In addition, board chairman Ramqvist appeared in local media on several occasions to counter remarks by the CEO, undercutting his authority, analysts say. "He was a bleak figure," says Lars Soederfjell, telecom analyst with Myrberg Securities in Stockholm. "The restructuring he started simply took too long. The results are poor. We find the move positive. Nilsson was not the right man for the job."

Nilsson agrees that he found it difficult to carry through changes at more-than-a-century-old Ericsson, which is notorious for its slow,consensus-based management style. He made plans to lay off nearly 14,000 workers in the next two years - 6,500 remain yet to be determined - and eventually made several acquisitions of Nordic and US Internet-technology companies.