Strategic Behavior in Standard-Setting Organizations

Brian J. Delacey, Harvard Business School, Kerry Herman, Harvard Business School, Josh Lerner, Harvard Business School - Finance Unit, and David Kiron, Harvard University

4/24/2008
(Original Publish Date: 5/18/2006)

This paper seeks to better understand the competitive behavior of firms in standard-setting organizations by examining two case studies. We examine the development of mobile Internet standards by the Institute of Electrical and Electronics Engineers (IEEE); and the development of DSL standards. The case studies highlight that standard-setting bodies play critical roles in these industries. Because innovations are typically not promulgated by a single firm, but rather draw together technologies developed in multiple firms, the coordination role played by these organizations is critical. And certainly in some cases, particularly where parties commit in advance to a formal process (such as the xDSL one), the standardization process can lead to a dispassionate selection of a superior technology as a standard.