Partner Selection Criteria in Strategic Alliances When to Ally with Weak Partners

Figure 1: The Relative Importance of Resources and Aspirations

5. MOBILE TELECOMMUNICATION MARKET

The mobile telecommunication market provides an ideal reference setting for assessing
the validity of our arguments. The emerging market for data-intensive services empha-
sizes the necessity for cross-industry alliances involving network operators, handset
manufactures, application developers and content providers to secure growing revenue
streams. In addition, the market is technology-intensive and life-cycles are relatively easy
to identify. We focus on the Western European market, which historically has been the
world’s most important mobile communication market - albeit Japan and South Korea
lately have taken lead positions. Within this market we concentrate on alliances involving
the two most influential segments: network operators and handset manufactures.

Provision of data-intensive services has been made possible through develop-
ments in the carrier technology, which facilitates network traffic and is the defining char-
acter of base stations and handsets. Carrier technologies have evolved through their first
and second generation and the third generation is currently being rolled out in Europe.
While the first and second generation was mainly used for voice and simple services, the
2.5G (GPRS) technology enabled provision of data-intensive services. 2.5G is merely a
technological extension of 2G (GSM) and most handsets on the market were 2.5G com-
patible. 3G (UMTS) increases the bandwidth and speed in service provisioning, but it
does not allow for significant new services, except video-telephony. Importantly, how-
ever, the technology differs from the previous and thus requires new handsets. Hence,

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