The grand coalition versus competing coalitions: trade-offs in how to standardize

Marc van Wegberg

1/01/2005
(Original Publish Date: 2003)

The standardization landscape in the Information and Communication technology industries is fragmented in many different standardization bodies, industry consortia, and alliances. Some of these coalitions cooperate with each other, while others compete. The existence of competing standardization coalitions may prevent coordination on a common standard. There is a lot of debate among practitioners and analysts about whether this fragmentation creates a coordination failure. This paper takes a middle ground in this debate. Competition between standardization coalitions may indeed harm compatibility, but it also helps to mitigate coordination failures within standardization bodies and coalitions. The negotiation process in a coalition can cause coordination failures of its own. An important failure is lack of timeliness, due to delaying tactics by company delegates in the coalition. Introducing competition between coalitions can speed up negotiations within them, and thus help to overcome this intracommittee coordination failure. A game theoretic model explores the effect of competition between coalitions on the speed of decision-making and standardization.