Coordination Costs and Standard Setting: Lessons from 56K Modems

Shane Greenstein, Northwestern University, and Marc Rysman, Boston University

9/02/2015
(Original Publish Date: 2004)

The authors offer a detailed analysis of the coordination costs behind the standardization of 56K modems. They focus primarily on market events and standard-setting activities during early deployment. They argue that the canonical model for a standards war is misleading in the case of 56K. They present alternative questions than the model’s and examine different views on how market events during deployment influenced negotiations within the International Telecommunications Union and vice versa.