Globalization in an industry destroys its previous structural and competitive equilibrium. It creates new opportunities but also some challenges to the companies, which are operating their businesses on a global scale. The companies in the face of rapid globalization require a new set of capabilities and a new way of competition.
This thesis is to draw some insights into why and how strategic networks in the global telecommunication service industry have been evolved and as a result of its evolution, what changes in the industry have been caused. In order to do so, a longitudinal study about the evolution of strategic networks for the period 1991-98 was carried out and their competitive behavior was analyzed at the industry-network level. We have found from the study that strategic networks have evolved as a way of acquiring collective competitive advantages in the globalizing industry and the oligopolistic rivalry such as pursuing first mover advantages, partners preempting and oligopolistic imitation stimulated the rapid spread of alliance constellations in the industry. As a result of the evolution of strategic network, the radical changes in competition structure and dynamics have been facilitated: 1) Group-based competition 2) Oligopoly structure and 3) High entry and exit barrier. These findings are also discussed in the relation to the industry characteristics such as network externality, globalization level and oligopolistic rivalry.
This study has a limitation in terms of generalizability and further research on other industries having characteristics similar with those of the global telecommunication industry should be done so as to support our findings. Nevertheless, we can still make an inference that strategic networks could be a sustainable way of securing strategic capabilities required in the global industry, especially those industries which are based on networks and depend much on the globalization as a strategic move. As long as each strategic network group in the industry pursues to build a globally integrated network, some of strategic alliance networks would be merged together to attain regional complementarity, which also would be accelerated by other dynamic network effects.
