t of Information Processing Science, P.O. Box 3000, FIN-90014 University of Oulu, Finland and The Research Institute of the Finnish Economy (ETLA), Lönnrotinkatu 4 B, FIN-00120, Helsinki, Finland, folli.martikainen@etla.fi Oleksiy Mazhelis, Information Technology Research Institute, P.O. Box 35, FIN-40014 University of Jyväskylä, Finland Oleksiy.Mazhelis@jyu.fi Mirja Pulkkinen, Information Technology Research Institute, P.O. Box 35, FIN-40014 University of Jyväskylä, Finland, Mirja.Pulkkinen@jyu.fr Kimmo Suojapelto, Technology Business Research Center, P.O BOX 20, 53851 Lappeenranta, Finland, kimmo.suojapelto@formin.fi Pasi Tyrväinen, Dept. of Comp. Sci. & IS, P.O. Box 35, FIN-40014 University of Jyväskylä, Finland, Pasi.Tyrvainen@jyu.fr Jari Veijalainen, Dept. of Comp. Sci. & IS, P.O. Box 35, FIN-40014 University of Jyväskylä, Finland, Jari. Veijalainen@jyu.fr Introduction Pasi Tyrväinen and Mirja Pulkkinen 1 Overview This book examines the evolution of vertical software industry, focusing on the industry of telecommunications software. In particular, this study analyzes the diffusion and vertical disintegration of the operations and business support systems (OSS/BSS) commonly deployed by contemporary telecom operators. Taking as a basis several models of industry evolution (technology diffusion, network extern- alities, evolution of the product, evolution of the vertical software industry), this book considers the current state of the telecommunications software market, analyzes the factors affecting further evolution of the OSS/BSS market, and describes scenarios of the market evolution in the future. The current state of the telecom software market is considered in the book from the viewpoints of both telecom operators and software vendors. The analysis suggests that the market evolution has not yet reached its stage of maturity and large devel- opments are still expected in near future. The analysis is based on both commercial databases on software market transactions and on interviews of operators in Europe