<nettime> Metatext on compatibility standards (1 of 2)

[Don Weightman <weightmands {AT} radix.net>]

This is the first of two messages with a reading list on the political
economy and  culture of technical standards.

Don Weightman

>
>ICS 280 -- Institutional Aspects of Computing
>
>Winter 1998
>
>Phil Agre
>
>Office: ICS2 202
>Phone: 824-5955
>Email: pagre {AT} ucsd.edu
>Web: http://communication.ucsd.edu/pagre/
>Office hours: TBA
>
>
>This is a graduate seminar on the economic, legal, and strategic
>aspects of technical compatibility standards.  It is open to all
>graduate students who feel prepared for it.
>
>Everyone who attends the class meetings, whether registered or not,
>will be required to read several assigned papers, contribute one page
>of reflections on the readings to a class mailing list by Monday
>evening, read everyone else's reflections on Tuesday before the class,
>and contribute their knowledge and questions to the class discussion.
>
>Those taking the class for credit will also be required to prepare
>a case study, using concepts from the course, of selected aspects
>of one information technology compatibility standard.  The last few
>class meetings will be devoted largely to presentation, analysis,
>comparison, and contrast of these case studies.  Those preparing case
>studies should make a draft available on a Web page by the end of week
>7 of the class, and everyone attending the class will be required to
>offer detailed written comments on three of the drafts.  The finished
>case studies will be made available to the Internet community.  Grades
>will be based primarily on the case study.
>
>The readings may seem frightening in their volume and diversity.  Be
>assured, however, that they are fairly redundant.  The phenomena of
>standards are so strange that most authors feel the need to explain
>the basics to each audience.  We will be able to gloss over much of
>that background material.
>
>
>Week 1 / Introduction
>
>  This week we'll go through the syllabus and introduce everyone.
>
>Week 2 / Background
>
>  Reading the literature on standards is like diving to the bottom of
>  the ocean: it's a different world, so complicated that the authors
>  have no choice but to simplify away a great deal.  Accordingly, we
>  will prepare ourselves by reading about various big pictures into
>  which the standards literature ought to fit.
>
>William J. Drake, The Internet religious war, Telecommunications
>Policy 17(9), 1993, pages 643-649.
>
>  Many people are familiar with standards issues mostly through the
>  publicity surrounding the Internet.  Viewed in historical context
>  of other technical standards, the Internet is quite atypical, and an
>  important question is whether the Internet standardization process
>  is the wave of the future, or whether it is an anomaly.  Drake's
>  article, really a review of Carl Malamud's "Exploring the Internet",
>  raises the issue in vivid and colorful terms.
>
>Nathan Rosenberg, Technological interdependence in the American
>economy, in Inside the Black Box: Technology and Economics, Cambridge:
>Cambridge University Press, 1982.
>
>  The various sectors of the economy do not evolve through independent
>  paths of technological innovation.  Quite the contrary, innovation
>  in one area of the economy frequently spills over into other
>  areas.  Rosenberg provides numerous examples.  This will be a
>  useful perspective to keep in mind when we consider case studies of
>  standardization that are confined to particular industries.
>
>Martin C. Libicki, Standards: The rough road to the common byte, in
>Brian Kahin and Janet Abbate, eds, Standards Policy for Information
>Infrastructure, Cambridge: MIT Press, 1995.
>
>  Libicki's chapter provides a relatively concrete survey of the major
>  information technology standards, considered as an interconnected
>  family, and the overall process through which they evolved.  By
>  keeping the particulars of this story in mind, we will be able to
>  test many of the theories of standardization that will appear in
>  later weeks' readings.
>
>Gregory Tassey, The roles of standards as technology infrastructure,
>in Richard Hawkins, Robin Mansell, and Jim Skea, eds, Standards,
>Innovation and Competitiveness: The Politics and Economics of
>Standards in Natural and Technical Environments, Edward Elgar, 1995.
>
>  There are a tremendous number of standards.  Taken as a whole,
>  Tassey argues, these standards are usefully viewed as a component of
>  a society's infastructure.
>
>Giovanni Dosi, Technological paradigms and technological trajectories:
>A suggested interpretation of the determinants and directions of
>technical change, Research Policy 11(3), 1982, pages 147-162.
>
>  Technologies do not arise at random, but through a
>  theme-and-variations pattern that is not driven solely by the
>  demands of a market considered in abstraction.  Dosi provides some
>  ways of thinking about the coherent "paradigms" of technology and
>  their subsequent evolution.  This will be a useful perspective when
>  we consider models of standardization that reduce technologies to
>  binary choices between one discrete standard and another.
>
>Ole Hanseth, Eric Monteiro, and Morten Hatling, Developing information
>infrastructure: The tension between standardization and flexibility,
>Science, Technology, and Human Values 21(4), 1996, pages 407-426.
>
>  Some standards are more successful than others.  Success can be
>  measured in terms of a standard's widespread acceptance or rejection
>  by markets and governments.  But it can also be measured in other
>  terms, for example its ability to evolve and to interact with later,
>  unpredicted innovations.  Hanseth et al describe how this need for
>  flexibility has been addressed in the Internet.
>
>Batya Friedman and Helen Nissenbaum, Bias in computer systems, ACM
>Transactions on Information Systems 14(3), 1996, pages 330-347.
>
>  It matters whether a standard arises, but it also matters which
>  standard arises, because standards, and thus artifacts themselves,
>  can embody socially meaningful biases.  Friedman and Nissenbaum
>  provide a taxonomy of the ways in which computer systems can be
>  biased.  This perspective will be nearly invisible through most
>  of the literature that we read this term, so we should try to keep
>  Friedman and Nissenbaum's analysis in mind throughout.
>
>
>Week 3 / Networks
>
>  The most important word this term is "network".  Unfortunately, this
>  word carries about five different meanings: (1) a set of machines
>  connected to one another by standard communications protocols;
>  (2) the presumptively homogenous group of individuals who have all
>  bought a given product, and who benefit from one another's use of
>  the product; (3) the presumptively heterogeneous set of products and
>  services that must all be available and working if any one of them
>  is to be enjoyed successfully; (4) a collection of business firms
>  joined together by a shifting set of alliances; and (5) the network
>  of individual human relationships through which familiarity with a
>  new technology diffuses.  This week we will read about the first
>  four of these, all of which will figure in later discussions.  For
>  business thinking about the fifth and its implications for strategy,
>  see Moore's "Crossing the Chasm".
>
>Michel Callon, Techno-economic networks and irreversibility, in John
>Law, ed, A Sociology of Monsters: Essays on Power, Technology and
>Domination, London: Routledge, 1991.
>
>  According to the actor network school of technology studies,
>  technological innovation is essentially a matter of assembling
>  heterogeneous networks of interdependent artifacts, people,
>  organizations, laws, and so forth.  Callon provides a highly
>  abstract vocabulary for talking about these networks and their
>  evolution.
>
>Gernot Grabher, Rediscovering the social in the economics of interfirm
>relations, in Gernot Grabher, The Embedded Firm: On the Socioeconomics
>of Industrial Networks, London: Routledge, 1993.
>
>  As industrial products and production processes become more
>  complicated, it becomes impractical for any one firm to command the
>  full range of necessary skills.  As a result, many analysts argue
>  that the global economy evolving into a complex and ceaselessly
>  shifting network of alliances among firms.  Grabher's chapter is the
>  introduction to an edited volume of articles on this phenomenon, and
>  it surveys various analyses of it.
>
>Harry M. Trebing, The networks as infrastructure: The reestablishment
>of market power, Journal of Economic Issues 28(2), 1994, pages
>379-389.
>
>  An unreconstructed opponent of laissez faire telecommunications
>  policy, Trebing provides a rapid survey of the conventional
>  mechanisms of market failure in telecommunications, arguing that
>  all of those mechanisms are alive and well.
>
>Jeffrey Rohlfs, A theory of interdependent demand for a communications
>service, Bell Journal of Economics 5(1), 1974, pages 16-37.
>
>  This article is often cited as the origin of network economics.
>  It offers a formal analysis of the observation that the value of
>  a telecommunications service to a subscriber depends in large part
>  on the number of other subscribers.  As a result, such "network"
>  markets tend to exhibit critical mass phenomena and other such
>  effects, which have come to become called network effects.
>
>Michael L. Katz and Carl Shapiro, Systems competition and network
>effects, Journal of Economic Perspectives 8(2), 1994, pages 93-115.
>
>  This is an informal introduction to the now-conventional analysis
>  of network effects that informs much of the literature that we will
>  read this term.  The basic argument is that network effects often
>  produce market failures.
>
>S. J. Liebowitz and Stephen E. Margolis, Network externality: An
>uncommon tragedy, Journal of Economic Perspectives 8(2), 1994, pages
>113-150.
>
>  And this is an introduction to the standard critique of that
>  analysis.  The basic argument is that real market economies have
>  many more ways of avoiding market failures than the simple network
>  effects models recognize.
>
>Recommended
>
>Dennis W. Carlton and J. Mark Klamer, The need for coordination among
>firms, with special reference to network industries, University of
>Chicago Law Review 50, 1983, pages 446-465.
>
>  This is a frequently cited early article on coordination in
>  infrastructural industries, observing that social welfare in
>  railroads and electronic funds transfer alike requires competitors
>  to work together.
>
>Svend Erik Jeppesen and Knud Bruun Poulsen, The text communications
>battlefield: Installed base, externalities and the fall of the telex
>system, Telecommunications Policy 18(1), 1994, pages 66-77.
>
>  This is a study of a failed attempt to introduce new standards in
>  the face of network effects and an installed base.
>
>
>Week 4 / Compatibility
>
>  Standards come in several varieties, but we are concerned
>  principally with compatibility standards -- the ones that ensure
>  that products work together as they're supposed to.  Compatibility
>  standards are important for numerous reasons, perhaps the most
>  important being that they seem path-dependent: once a given
>  compatibility standard becomes widely adopted, it is difficult for
>  everyone to switch to a new standard because new equipment needs
>  to be compatible with old equipment.  The nature and limits of this
>  phenomenon is perhaps the central topic of the course.
>
>Francois Bar, Michael Borrus, and Richard Steinberg, Islands in the
>bit-stream: Charting the NII interoperability debate, Working Paper
>79, Berkeley Roundtable on the International Economy, 1995.
>
>  "Interoperability", a word from the Internet world, appears to
>  mean roughly the same thing as "interconnection", a word from the
>  telecommunications world.  The juxtaposition of these two words
>  points to a larger collision of technical, strategic, and regulatory
>  worlds.  Bar et al outline various aspects of this collision, and
>  their article (a classic already at three years of age) previews
>  themes that will be developed more fully in later readings.
>
>Paul A. David and W. Edward Steinmueller, Standards, trade and
>competition in the emerging Global Information Infrastructure
>environment, Telecommunications Policy 20(10), 1996, pages 817-830.
>
>  Amidst all of the optimism about the Internet, introduced by
>  Drake above, David and Steinmueller argue the unpopular case that
>  the Internet model is not sustainable.  In particular, they argue
>  that both its architecture and its institutional structures will
>  necessarily evolve back toward the bad old telecommunications
>  models.
>
>Sanford V. Berg, The production of compatibility: Technical standards
>as collective goods, Kyklos 42, 1989, pages 361-383.
>
>  This is a mathematical model of the conditions under which an
>  economy will produce the optimal amount of compatibility.  The
>  starting point of the analysis, I am afraid, appears in an article
>  by Kindleberger that we will read later on, and that it will
>  probably be helpful to preview now.
>
>Carl Cargill, Evolution and revolution in open systems, StandardView
>2(1), 1994, pages 3-13.
>
>  "Open systems" has meant several different things at different
>  points in history, depending on which market was serving as the
>  paradigm example in a given period.  Cargill recounts the history
>  and differentiates the meanings.
>
>Michael L. Katz and Carl Shapiro, Technology adoption in the presence
>of network externalities, Journal of Political Economy 94(4), 1986,
>pages 822-841.
>
>  Competing standards often benefit from "sponsors" who are willing
>  to take losses in hopes of profiting later by capturing network
>  externalities once its standard wins in the marketplace.  Katz and
>  Shapiro provide a model of such sponsorship decisions, investigating
>  which standard wins in various market configurations.
>
>Recommended
>
>Yale M. Braunstein and Lawrence J. White, Setting technical
>compatibility standards: An economic analysis, Antitrust Bulletin
>30(2), 1985, pages 337-355.
>
>  This is a widely cited early analysis of the interaction between
>  the economic properties of standards and choices about vertical
>  integration, a fundamental and understandable concern of antitrust
>  policy.  The basic point is that antitrust's suspicion of vertical
>  integration should be tempered by its potential efficiencies in a
>  standards-driven market.
>
>
>Week 5 / Organizations
>
>  Most people think of standards as documents that are issued by
>  formal standards organizations such as ISO, ANSI, and the IETF.
>  But the world is changing, and the nature and role of these
>  organizations is changing as well.  We will consider the inherent
>  economic tensions that underlie cooperative standards activities,
>  the interaction of various players' strategies, the tensions that
>  standards organizations experience as these strategies change, and
>  various potential responses.  This week's reading also includes
>  several case studies, all of which are recommended rather than
>  required reading.
>
>Timothy Schoechle, The emerging role of standards bodies in the
>formation of public policy, IEEE Standards Bearer 9(2), 1995, pages
>1, 10.
>
>  This very brief article anticipates our discussion of standards
>  policy.  In it, Schoechle points out that standards organizations
>  promulgate rules that change the world in ways that have material
>  consequences for people's lives, and in that sense they can be
>  viewed as making public policy.  This analogy between standards
>  organizations and legislatures is an important counterbalance
>  to the predominance of economic analysis in the literature on
>  standardization.  Standardization is not just a marketplace but
>  a public sphere, and it is altogether remarkable how these two
>  seemingly opposite analogies are able to work so well at the same
>  time.
>
>Charles P. Kindleberger, Standards as public, collective and private
>goods, Kyklos 36(3), 1983, pages 377-396.
>
>  The production of a standard requires effort and resources, and
>  yet the resulting standard can typically be practiced by a wide
>  variety of parties who did not contribute to it.  Conventional
>  theory therefore predicts that the economy will not produce enough
>  standards.  This is the most basic economic idea for understanding
>  the dynamics of standards organizations.  Kindleberger sketches
>  several historical cases and analyzes the risks of market failure.
>
>Paul A. David and Mark Shurmer, Formal standards-setting for global
>telecommunications and information services, Telecommunications Policy
>20(10), 1996, pages 789-815.
>
>  As telecommunications becomes increasingly privatized and
>  competitive, the strategic interests of various industry players are
>  increasingly played out in standards-setting forums.  As a result,
>  those forums find themselves under increasing tension.  David and
>  Shurmer describe these tensions.  They point to the increasing
>  attractiveness of by-passing the official forums, and they point to
>  potential reforms that might increase the capacity of those forums
>  to resolve the more complicated and sharply drawn conflicts in the
>  industry.
>
>Susanne K. Schmidt and Raymund Werle, The development of compatibility
>standards in telecommunications: Conceptual framework and theoretical
>perspective, in Meinholf Dierkes and Ute Hoffman, eds, New Technology
>at the Outset: Social Forces in the Shaping of Technological
>Innovations, Frankfurt: Campus Verlag, 1992.
>
>  This is an unusually sophisticated theoretical analysis of the
>  interaction among institutional forms, participants interests, and
>  inherent properties of a technology in shaping the formal processes
>  of standardization.  Their case study is telecommunications
>  standard-setting in the CCITT.
>
>Joseph Farrell and Garth Saloner, Coordination through committees and
>markets, RAND Journal of Economics 19(2), 1988, pages 235-252.
>
>  Standards-setting is an example of the broader phenomenon of
>  coordination.  Farrell and Saloner use methematical modeling to
>  inquire into the conditions under which economic self-interest
>  compels market participants to coordinate their activities through
>  formal committees, and when that coordination arises instead through
>  market competition.
>
>William Lehr, Compatibility standards and interoperability: Lessons
>from the Internet, in Brian Kahin and Janet Abbate, eds, Standards
>Policy for Information Infrastructure, Cambridge: MIT Press, 1995.
>
>  The Internet standards process is universally regarded as
>  exceptionally successful, and Lehr's chapter is one of numerous
>  attempts to extract lessons from it that might be applied more
>  broadly.  Although some of the IETF's success is due to the
>  favorable environment of its earlier years, more generalizable
>  lessons include the virtues of partial standardization, the
>  insistence on working models, and constant communication among the
>  participants over the Internet itself.
>
>Recommended
>
>Kai Jakobs, Rob Procter, and Robin Williams, Users and
>standardization: Worlds apart? The example of electronic mail,
>StandardView 4(4), 1996, pages 183-191.
>
>  Every standard has an array of stakeholders, and the nature
>  and interests of those stakeholders predict the nature of their
>  participation in standards processes.  This article considers the
>  case of electronic mail.
>
>Martin B. H. Weiss, Compatibility standards and product development
>strategy: A review of data modem developments, Computer Standards and
>Interfaces 12, 1991, pages 109-122.
>
>  One common hypothesis in the standards literature is the supposed
>  trend toward anticipatory standards, that is, standards developed in
>  advance of the market instead of in reaction to it.  Anticipatory
>  standards make sense when network externalities threaten significant
>  losses for firms whose products become stranded.  Given that
>  motivation to agree on a standard a priori, Weiss describes a range
>  of strategies that firms might take in the standards process.
>
>Ben Dankbaar and Rob van Tulder, The influence of users in
>standardization: The case of MAP, in Meinholf Dierkes and Ute Hoffman,
>eds, New Technology at the Outset: Social Forces in the Shaping of
>Technological Innovations, Frankfurt: Campus Verlag, 1992.
>
>  Another recurring issue in the standards literature is the role
>  of users.  Involving users in standardization processes is this
>  literatures' version of motherhood and apple pie, but the ideal
>  is rarely achieved.  The situation is most propitious when the
>  users are highly sophisticated, understand their stake in getting
>  good standards, and are organized enough for sustained involvement
>  in the process.  Such is the case with manufacturing standards,
>  and companies such as General Motors have even taken considerable
>  initiative to impose standards on their suppliers.  And yet, in the
>  end, the process has still been largely dominated by the vendors.
>  Dankbaar and van Tulder explain why this is.
>
>Marvin A. Sirbu and Laurence E. Zwimpfer, Standards setting for
>computer communication: The case of X.25, IEEE Communications Magazine
>23(3), 1985, pages 35-45.
>
>  Through a case study of the X.25 digital communications standard,
>  Sirbu and Zwimpfer attempt to infer some of the conditions under
>  which standards organizations succeed in achieving consensus around
>  a candidate standard.  Some of these conditions pertain to the
>  structure of the standard itself (for example, the advisability of
>  layering) and others pertain to the process of consensus-building
>  (for example, first assembling a coalition in private, offline
>  meetings).
>
>Mark Pesce, The great leap downward, Feed, February 1997.
>
>  Mark Pesce is the inventor of the Virtual Reality Markup Language
>  (VRML).  VRML hasn't taken over the world yet, and one reason
>  for this is the amazing and frequently hilarious story of Pesce's
>  attempt to standardize it.  This is his war story.
>
>
>Week 6 / Strategy
>
>  Standards-driven markets can be extraordinarily complicated
>  from a strategic perspective.  We will consider several aspects
>  of strategy: ensuring the availability of a full product network,
>  anticipating the interactions among different firms' strategies,
>  market-tilting tactics such as preannouncement, and attempts to
>  influence a standard substantively.
>
>David J. Teece, Capturing value from technological innovation:
>Integration, strategic partnering, and licensing decisions, in Bruce
>R. Guile and Harvey Brooks, eds, Technology and Global Industry:
>Companies and Nations in the World Economy, Washington, DC: National
>Academy Press, 1987.
>
>  The success of a new product usually does not depend solely on
>  its inherent attributes.  Quite the contrary, customers will only
>  buy the product if an array of complementary products is available.
>  As a result, strategists attempting to maximize the return from
>  innovation will naturally wish to analyze the market for these
>  complementary products.  A fundamental point of strategy is whether
>  to provide those complementary products oneself.
>
>Peter Grindley, Standards Strategy and Policy: Cases and Stories,
>Oxford: Oxford University Press, 1995.  Chapter 2: Framework for
>Standards Strategy.
>
>  Firms in standards-driven markets face at least two choices:
>  whether to pursue open or proprietary standards, and whether to
>  lead or follow the market in the transition to a new standard.  The
>  resulting 2x2 matrix of possibilities provides the starting-point
>  for strategic analysis.
>
>Joseph Farrell and Garth Saloner, Installed base and compatibility:
>Innovation, product preannouncements, and predation, American Economic
>Review 76(5), 1986, pages 940-955.
>
>  Farrell and Saloner present a mathemtical model of the consequences
>  of network effects for transitions between standards.  The
>  relatively intuitive result is that, because of the network effects
>  that tend to lock customers into the standards they are already
>  using, a market may exhibit "excess inertia" in the transition to
>  a new standard.  The less intuitive result is that, if those same
>  customers understand the dangers of being "stranded" in the standard
>  of their installed base, then the market may instead exhibit "excess
>  momentum" in the form of a premature transition to a new standard.
>
>Richard Hawkins, Standards for communication technologies: Negotiating
>institutional biases in network design, in Robin Mansell and Roger
>Silverstone, eds, Communication by Design: The Politics of Information
>and Communication Technologies, Oxford: Oxford University Press, 1996.
>
>  This is a sophisticated theoretical analysis of the idea that
>  standards can embody inherent biases.  It follows that competition
>  over standards is not simply a matter of who defines the standards,
>  but also a matter of what the standard substantively consists of,
>  and what its consequences will be once it is placed in operation.
>  These considerations define a strategic field of great complexity,
>  and they help explain the dynamics of standardization processes, and
>  particularly the forums that established players choose in pursuing
>  their standardization goals in a supposedly globalizing context.
>
>H. Landis Gabel, Competitive Strategies for Product Standards: The
>Strategic Use of Compatibility Standards for Competitive Advantage,
>London: McGraw-Hill, 1991.  Chapters 3 and 9.
>
>  Chapter 3 is a study of video recorders, and chapter 9 is a series
>  of theses that Gabel conjectures as a result of the full range of
>  studies in his book.
>
>Recommended
>
>Marvin B. Lieberman and David B. Montgomery, First-mover advantages,
>Strategic Management Journal 9, 1988, pages 41-58.
>
>  This article does not specifically concern standards.  It is,
>  rather, an attempted taxonomy of the whole range of advantages
>  that can accrue to the first firm to enter a given market.  I have
>  included it to provide us with a context in which to examine the
>  oversimple conventional wisdom that the first standard to market
>  wins.  Moving first is not necessarily the optimal strategy, and
>  the potential benefits of first-movership are more various than
>  those involved with standards alone.
>
>Peter Grindley, Standards Strategy and Policy: Cases and Stories,
>Oxford: Oxford University Press, 1995.  Chapters 4-6.
>
>  These are three case studies from Grindley's book: VCR's (in which
>  the lesson concerns the creation of alliances around a standard),
>  compact discs and digital audio tape (in which the lesson concerns
>  market timing), and personal computers (in which the lesson concerns
>  open standards and the conditions under which they can succeed).
>  Observe that we are also reading Gabel's study of the celebrated
>  case of video recorders; we will have the opportunity to compare and
>  contrast.
>
>Stanley M. Besen and Joseph Farrell, Choosing how to compete:
>Strategies and tactics in standardization, Journal of Economic
>Perspectives 8(2), 1994, pages 117-131.
>
>  Standards competitions are not always simple matters of
>  symmetrically organized, head-to-head battles to the death between
>  conflicting standards.  Individual firms have many other choices,
>  such as adopting another firm's standard and competing on production
>  efficiencies.  Because the rewards of each strategy depend on the
>  strategies chosen by others, competition in standards markets has
>  a game-theoretic quality.  Besen and Farrell's model attempt to
>  preduct which strategies will be chosen depending on each firm's
>  relative initial positioning in the marketplace.
>
>Robin Mansell, Designing electronic commerce, in Robin Mansell and
>Roger Silverstone, eds, Communication by Design: The Politics of
>Information and Communication Technologies, Oxford: Oxford University
>Press, 1996.
>
>  Arguing along similar lines to Hawkins, Mansell argues that
>  electronic commerce standards have typically evolved in ways that
>  inherently favored the interests of the most powerful players.
>
>
>Week 7 / Modularity
>
>  An emerging theme in the literature is the interaction between
>  the structure of products and the structure of industries and firms.
>  We will consider the specific case of modularity.  Technical people
>  tend to portray modularity as an ahistorical design norm, but this
>  approach cannot tell us the conditions under which markets produce
>  modular systems.  We will consider the matter in both its empirical
>  and a strategic aspects.
>
>Kim B. Clark, The interaction of design hierarchies and market
>concepts in technological evolution, Research Policy 14, 1985, pages
>235-251.
>
>  Clark argues that markets mature from a fluid state toward a more
>  rigid, standardized state in large part through the consolidation of
>  the customers' concept of the product.  Examples are drawn from cars
>  and semiconductors.
>
>Carliss Y. Baldwin and Kim B. Clark, Managing in an age of modularity,
>Harvard Business Review 75(5), 1997, pages 84-93.
>
>  This is a relatively breezy article for managers about the
>  competitive issues that arise as markets evolve toward modularity.
>
>Richard N. Langlois and Paul L. Robertson, Networks and innovation in
>a modular system: Lessons from the microcomputer and stereo component
>industries, Research Policy 21(4), 1992, pages 297-313.
>
>  This is a qualitative analysis of the conditions under which
>  complicated products such as computers and stereo systems are
>  provided as separate modular components, and when they are provided
>  as integrated products.  They suggest that modularity is linked with
>  horizontal and vertical disintegration, and they express cautious
>  (and I think far too hopeful) optimism that markets tend toward
>  modularity because of the efficiencies that disintegration brings.
>
>Nicholas Economides and Steven C. Salop, Competition and integration
>among complements, and network market structure, Journal of Industrial
>Economics 40(1), 1992, pages 105-123.
>
>  Economides and Salop provide a mathematical model of complementary
>  products in network markets.  The remarkably difficult question is
>  when the products are provided as an integrated unit by the same
>  firm and when they are provided independently in the marketplace.
>
>Marc H. Meyer and Alvin P. Lehnerd, The Power of Product Platforms:
>Building Value and Cost Leadership, New York: Free Press, 1997.
>Chapter 2: Managing Product Platforms.
>
>  A product platform is a common core for a whole family of related
>  products.  By defining a set of in-house standards, the platform
>  permits design and manufacturing costs to be shared among several
>  products.  This chapter discusses the interaction between the
>  structure of a product family and the structure of the market spaces
>  that the various products will address.
>
>
>Week 8 / Policy
>
>  For people from many backgrounds, standards tend to imply de jure
>  standards set by the government, or through formal negotiations
>  between governments.  This was historically the case in
>  telecommunications, but as world changes the question arises of
>  government's proper role in the standards process.  Ideological
>  approaches to the question tend toward the predictable extremes, but
>  in the middle lies a very complicated range of alternatives whose
>  advisability depends on the interactions among numerous aspects of
>

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