. 2 based on IDC and EITO forecasts extrapolated to 2015 the IP Applica- tions segment includes communication investments in service software for corpo- rate, public and consumer services, which are IP-compatible, both narrow- and broadband. As we can see, the investments in narrowband fixed services, which consist mainly of telephony and ISDN technology, will end by 2015. On the other hand, the investments in broadband fixed and wireless technologies will grow substantially. Incumbent telecom operators have market power based on network ownership especially in access networks and on service management including customer access and billing. This has been realized in GSM by the vertical integration based on the SIM-card. Incumbent telecom manufacturers have market power in their essential patent portfolios. In ETSI the patents covering some aspects of ETSI standards are called essential patents. ETSI demands that all essential patents are available for licensing on a fair basis. Major GSM manufacturers have used their GSM patent portfolios for cross-licensing purposes to obtain full patent portfolios. Barriers to Horizontal Development Essential patent portfolios are especially large in GSM and 3G technologies (Bekkers and West 2006; ETSI 2005). The GSM-patents become obsolete when they reach the end of their lifetime after the age of 20 years, which already happened in 2008 to the first GSM-patents. Disruptive points Incumbent strategy -Applications -Segment and bundle -Consumer -VolP -USIM and OMA -Office HORIZONTAL ACCESS -Terminal os -Block interfaces -WLAN, WiMAX -Better radio 3G ->4G IP BASED NETWORK -Universal Mobile -IP network Access (UMA) -Roaming -Google, Ebay, -Open Mobile HORIZONTAL SERVICES -Skype Architecture (OMA) -"Web-telco" -Partner -Bundle Vertical GSM - Vertical GSM -service technology based provisioning based on on GSM patents SIM-card Fig. 3 Horizontal disruptive points of mobile services Siemens Alcatel Philips Qualcomm Others Motorola Interdigital Ericsson Nokia Fig. 4 Essential GSM patent