Characteristics of Infrastructure Sectors and Implications for Innovation Processes

Infrastructure sectors such as energy, gas or water supply, waste water treatment or telecommunication provide us with services that are essential for modern life and for industrialized societies. In order to better understand the opportunities and limits of transformation processes in infrastructures, we will explore the particularities of these sectors. We introduce and discuss five dimensions, along which we identify key sector characteristics. These include capital intensity, asset durability, a key role of public organizations, regulation intensity and a high degree of systemness. We compare selected infrastructure sectors with regard to these characteristics and discuss their implications for the sectors’ propensity to transform. Furthermore, major internal drivers for change such as environmental impacts, massive capital needs and introduction of competition are derived from the sector characteristics. It is concluded that capital intensity and asset durability together with the systemic character represent barriers for change and that public organizations and regulation intensity are rather neutral, though key influences for innovation processes.