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

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.Economics ;

A note on network structure: functional relationships between network indicators

Two important aspects of network structure are network density and network centrality. These two aspects highlight different characteristics of a network. Empirical studies tend to find that one or the other is the better explanatory variable for certain aspects of corporate behaviour. This note makes a simple and compelling point. There is a hill-shaped relationship between network density and network centrality. A purely stochastic process of alliance formation will lead to a hill-shaped relationship. A mathematical, functional relationship can be shown between network density and the upper bound to network centrality. The combination of these outcomes sets lower and upper bounds on network centrality. This approach can offer a vantage point for an evolutionary study of network structure.Economics ;

Evolution and Competition in the Market for Handheld Computers

Since the early 1990s, electronic organisers or electronic agendas have been evolving towards fully fledged, but miniature, computers. This paper is a case study about this market. Uniquely, and reminiscent of the home computer market in the 1980s, this is a market for personal computers not dominated by Microsoft. Or at least, not yet. In tracking the evolution of this market, the paper points especially to the importance of networking and standardization. The market for handheld computers is a small market, compared to the units shipped in the market for PCs. Nevertheless a surprisingly large number of vendors has been and still is active in this market. During the short history of this market, there have been several periods where technological breakthroughs created expectations of huge growth, with entry by new suppliers as a result. As the dust settled, the losers either changed strategy, or left the market altogether. The paper will argue that standardization and networking are major factors in explaining competitive success and the recent growth of the industry.industrial organization ;

Competing communities of users and developers of computer software: competition between open source software and commercial software

The open source movement is a group of volunteer programmers that has recently caused quite a stir in the software market. The volunteers of this group develop computer operating systems, programming languages, and other software. They work together in teams that communicate via the Internet. Their goal is to develop useful software that is available for free and that users can change at will. To enable users to change and improve the software, they distribute their software not only in compiled form (that a computer needs to actually run the software), but also in its source code (the lines of code that programmers write). This cooperation breaks through the usual barriers that separate corporate suppliers from their buyers. This may represent the first example where the Internet enables cooperation on a scale that changes market dynamics. This paper studies the interaction between the network dynamics of the open source movement and the dynamics of a commercial software supplier. It makes our first step in identifying conditions that support a successful development of open source software. We focus on one particular set of projects within the open source movement, namely the Linux computer operating system.management and organization theory ;

Standard Selection Modes in Dynamic, Complex Industries: Creating Hybrids between Market Selection and Negotiated Selection of Standards

Several sectors within Information and Communication Technology demonstrate a shift from purely market-based selection of standards or purely negotiated selection of standards to hybrid selection processes, where both market competition and negotiation play a role. Negotiated standard setting processes (such as those organised by the ITU) assure interoperability of technical components and services. Private firms, however, increasingly tend to undercut these collective actions. Their innovations jump-start new developments, but also create incompatibilities, lock-in effects, and pockets of market power. Internet telephony is an example, where firms, standard setting alliances, and political institutions create a hybrid market-based / negotiated standard setting environment. The paper explores the development of this hybrid networking environment. It posits propositions which are illustrated by means of case studies of the DVD and Internet telephony.industrial organization ;

Can R&D alliances facilitate the formation of a cartel? The example of the European IT industry

Firms may coordinate their R&D decisions by a merger or an R&D alliance. The European Union stimulates R&D alliances. It expects that these stimulate R&D investments, and guarantee that the cooperating firms compete in the product market. The alliances may, however, stimulate firms to collude in the product market. Alliances then point to emerging cartels. The paper explores the conditions where this fear holds.research and development ;