Complex Network Perspective on Collaboration in the ICT Standardization

Introduction

Standardization (Swann, 2010) and Information and Communications Technologies (ICT) standardization specifically (Shin, Kim, & Hwang, 2015) have been studied extensively. Standards and standardization are major drivers of choice and change. Standards are known to enable ecosystems where complementary products utilize open interfaces (Katz & Shapiro, 1985). Emerging network effects reflect the strength and type of ties defined by standardized interfaces. Network effects motivate companies to voluntarily contribute their proprietary technologies to open standardization (Economides, 1996) while too strong network effects create undesired technology lock-in as is the case in the QWERTY keyboard (David, 1985). High expectations related to the network effects can make incompatible competition more lucrative for leading dominant companies. Therefore, open interoperability through standardization must be favoured by public policy makers (Farrell & Klemperer, 2007).

Linkages between standardization and business models have increased. Scope of standardization has expanded to new areas when focused collaborative consortia have emerged to address weaknesses of the traditional formal standardization (Hawkins & Ballon, 2007), (Blind & Gauch, 2008). Number and volume of different standardization activities has spawned as needs for interoperability, compatibility, scale of economies and for faster innovation diffusion have increased in the globalized markets (Choi, Kim, & Lee, 2010; Rogers, 1995).

Extensive use of the ICT technologies spreads even broader in our society today when the 5G, Internet of Things and consumers' data driven applications are emerging. The ICT standardization with multiple parallel processes needs more clarity and better structures. Traditional classification of standardization leans to the question whether an activity has a formal legal status defined by regulation (de jure) or if market actors drive the effort (de facto). The de jure standards may be promulgated directly by governmental agencies (mandated) or be based on a collaborative work in standards writing organizations (committee) having a formal delegated (“licensed”) position. Long time ago governmental organizations alone took care of standards for telecommunications. This approach has almost disappeared except in few areas like national security. Authorized organizations such as the European Telecommunications Standards Institute¹ (ETSI) create most of the formal standards for telecommunications today.

De facto standards may have a dedicated sponsor or owner, which have interest and full control over the standard (proprietary platform leader controlling the publicly available interface specifications) or an “unsponsored” standard is an outcome of a voluntary open collaboration of interested actors. This last model is the most rapidly growing area of standardization, the Bluetooth² community being one example. The key difference between the two de facto standardization approaches is the level of openness and control of the standard and the standardization process (David & Greenstein, 1990; Funk & Methe, 2001; Gandal, Salant, & Waverman, 2003). As a summary, Table 1 shows a simplified categorization.