Innovative companies in technologically advanced environments have to deal with the consequences of choosing between a resource based strategy and possibly missing out on the benefits of cooperative knowledge, or collaborating with their network of suppliers, customers and even competitors and risk diluting their competitive advantage.

This thesis is concerned with the cooperative aspect within intricate networks of technologically innovative firms. To gain a better understanding of this phenomena, the most innovative sector in Sweden has been chosen for a case study.

The purpose of this thesis is to explore the dynamics of innovation within the telecom sector in Sweden, and determine the level of cooperation within the telecom sector, in terms of the flows of information and embeddedness.

The method chosen to fulfil this purpose was via a qualitative approach, and in the form of a case study. Relevant data was collected through five interviews with key personnel within the two companies of interest (Ericsson & TeliaSonera), and triangulated with secondary quantitative and qualitative data.

Results indicate that the Swedish telecom sector benefits from a fertile environment that fosters innovative activity, and to that reason it has claimed leadership in the worldwide telecommunications industry. Additionally, this same environment promotes collaboration between the different actors in the sector. A closer examination of the cooperation between TeliaSonera and Ericsson in the 4G network roll-out, indicates that the cooperation, albeit being successful, could be ameliorated further through an increased embeddedness of the partnership.