Since the past decades, network industries are undergoing profound reform (liberalization). The changes are largely brought about by growing competition, changing customer demands, and the more widespread use of the information and communication technologies. Furthermore, governments are expecting higher returns and increased productivity. The major motivation for such reform processes was and still is the belief that liberalization and deregulation stimulates, among others, product and process innovations, both of which are important vehicles for productivity and economic growth. The ability of any company to create and sustain competitive advantages over the long term will depend on how well the firm deals with changes in its environment and manages to exhibit innovative behavior.

Against the background of such  reform processes, network industries search for new innovation models so as to increase their performance and to ensure their profitability and growth. A possibility to adapt the innovation management of network industries to the changed environmental conditions are so-called 'open innovation models': ideas are no longer exploited just from inside the company but also from outside of it, as it is assumed that such purposive in- and outflow of knowledge and resources result in better innovation performance. In this article we analyze the impact of the reform process on of network industries’ innovation management. Moreover, we identify options on how the network industries can implement and use open innovation models to increase their innovativeness and to gain competitive advantage in liberalized markets.