Book contents
- Frontmatter
- Contents
- List of figures
- List of tables
- List of contributors
- Introduction
- 1 Standard setting in markets: the browser war
- 2 Competition through institutional form: the case of cluster tool standards
- 3 The economic realities of open standards: black, white, and many shades of gray
- 4 Coordination costs and standard setting: lessons from 56K modems
- 5 Promoting e-business through vertical IS standards: lessons from the US home mortgage industry
- 6 Intellectual property and standardization committee participation in the US modem industry
- 7 Manipulating interface standards as an anticompetitive strategy
- 8 Delay and de jure standardization: exploring the slowdown in Internet standards development
- 9 Standardization: a failing paradigm
- 10 Standards battles and public policy
- 11 Switching to digital television: business and public policy issues
- 12 Should competition policy favor compatibility?
- Index
- References
6 - Intellectual property and standardization committee participation in the US modem industry
Published online by Cambridge University Press: 22 September 2009
Book contents
- Frontmatter
- Contents
- List of figures
- List of tables
- List of contributors
- Introduction
- 1 Standard setting in markets: the browser war
- 2 Competition through institutional form: the case of cluster tool standards
- 3 The economic realities of open standards: black, white, and many shades of gray
- 4 Coordination costs and standard setting: lessons from 56K modems
- 5 Promoting e-business through vertical IS standards: lessons from the US home mortgage industry
- 6 Intellectual property and standardization committee participation in the US modem industry
- 7 Manipulating interface standards as an anticompetitive strategy
- 8 Delay and de jure standardization: exploring the slowdown in Internet standards development
- 9 Standardization: a failing paradigm
- 10 Standards battles and public policy
- 11 Switching to digital television: business and public policy issues
- 12 Should competition policy favor compatibility?
- Index
- References
Summary
Abstract
The authors take a preliminary look at the interaction between patenting and standardization committee participation in the US modem industry. Both involve a much wider set of firms than the downstream modem manufacturers themselves. Not surprisingly, the two activities are highly correlated across firms. Using five-year periods, Granger causality tests show that while patenting is predicted by participation in earlier standardization meetings, meetings participation is not predicted by earlier patenting. The authors interpret these results as reflecting the timing of standard setting relative to innovation.
Introduction
The past two decades have witnessed a proliferation of high-tech consumer electronic products which exhibit network effects. Successful diffusion of these products is often contingent on a single product winning a battle of market standards or firms achieving compatibility among competing standards. The benefit to consumers from purchasing a network good depends on the number of other consumers who eventually purchase the same network good, or a compatible one. This situation has two main implications for competition in network markets, with competing standards:
Consumers' expectations regarding the future size of a network are critical in the adoption decision. On the one hand, the expectation that one technology will become a standard may be self-fulfilling. On the other hand, fragmented expectations may lead to a battle with no winner. Postrel (1990) partly attributes the failure of quadraphonic sound in the 1970s to competing standards.
[…]
Information
- Type
- Chapter
- Information
- Standards and Public Policy , pp. 208 - 230Publisher: Cambridge University PressPrint publication year: 2006
References
Augereau, A., S. Greenstein, and M. Rysman 2003. “Coordination vs. differentiation in a standards war: 56 K Modems,” mimeo, Boston: Boston University.
Caplan, P. 2003. “Patents and open standards,” National Information Standards Organization, available at http://www.niso.org/press/whitepapers/Patents_Caplan.pdf.
Cargill, C. 2004. “Standardization, the necessary luxury,” available at http://www.geoplace.com/gw/2004/0403/0403ogc1.asp.
, and 1990. “The economics of compatibility standards: An introduction to recent research,” Economics of Innovation and New Technology 1: 3–41.CrossRefGoogle Scholar
Farrell, J., and P. Klemperer, in press. “Coordination and lock-in: Competition with switching costs and network effects,” in Handbook of industrial organization, Vol. III, and (eds.), Amsterdam: Elsevier.
, and 1988. “Coordination through committees and markets,” RAND Journal of Economics 19: 235–52.CrossRefGoogle Scholar
1995. “A selective survey of the literature on indirect network externalities,” Research in Law and Economics 17: 23–31.Google Scholar
2002. “Compatibility, standardization, and network effects: Some policy implications,” Oxford Review of Economic Policy 18: 80–91.CrossRefGoogle Scholar
, , and 1999. “Adoptions and orphans in the early microcomputer market,” Journal of Industrial Economics 47: 87–105.CrossRefGoogle Scholar
Garen, C. 2000. “Analog modems take center stage: Industry trend or event,” Electronic News, August 7, http://www.findarticles.com/cf_dls/m0EKF/32_46/65023364/p1/article.jhtml.
1992. “Symposium on compatibility: Incentives and market structure,” Journal of Industrial Economics 40: 1–8.CrossRefGoogle Scholar
2000. “Does the new economy measure up to the great inventions of the past?” Journal of Economic Perspectives 14: 49–74.CrossRefGoogle Scholar
1969. “Investigating causal relations by econometric models and cross-spectral methods,” Econometrica 37: 424–38.CrossRefGoogle Scholar
International Telecommunication Union 1998. “Agreement reached on 56 K modem standard,” available at http://www.itu.int/newsarchive/press_releases/1998/04.html.
, and 1994. “Systems competition and network effects,” Journal of Economic Perspectives 8: 93–115.CrossRefGoogle Scholar
Kenas, B. 1997. “Modems,” available at http://www.nric.org/fg/fg2/sc1/fg2-sc1-modems-final.doc. Original sources include the Information Technology Industry Council and the Data Analysis Group.
2002. “Intellectual property rights and standard-setting organizations,” California Law Review 90: 1889.CrossRefGoogle Scholar
, and 1996. “A selective review of the economics of standardization: Entry deterrence, technological progress, and international competition,” European Journal of Political Economy 12: 183–206.CrossRefGoogle Scholar
Meidan, M. 2004. “The effects of the standardization process on competition: An event study of the standardization process in the US cable modem market,” mimeo, Stanford, CA: Stanford University.
Merges, R. 1998. “Institutions for intellectual property transactions: The case of patent pools,” mimeo, Berkeley, CA: University of California-Berkeley.
, , , and 1994. “Computers and output growth revisited: How big is the puzzle?” Brookings Papers on Economic Activity 1994: 273–317.CrossRefGoogle Scholar
1990. “Competing networks and proprietary standards: The case of quadraphonic sounds,” Journal of Industrial Economics 39: 169–85.CrossRefGoogle Scholar
Simcoe, T. 2004. “Committees and the creation of technical standards,” mimeo, Berkeley, CA: University of California-Berkeley.
Accessibility standard: Unknown
Why this information is here
This section outlines the accessibility features of this content - including support for screen readers, full keyboard navigation and high-contrast display options. This may not be relevant for you.Accessibility Information
Accessibility compliance for the PDF of this chapter is currently unknown
and may be updated in the future.
- 11
- Cited by