1. The Business of Standards
November 2016
University of Colorado
Boulder, CO
Ken Krechmer
I will take questions of clarification throughout. Comments may be raised at the end.

2. Classic Business Model
Profitable Business
Product
Market
Example John Deere plow

3. Communications Business Model
Profitable Business
Products
Markets
RJ jacks (interfaces) created large new markets: private telephones, dial-up modems, answering machines, PBX’s.
Interfaces

4. Definitions Reference: Basis for comparison
Standard: A codified and quantified reference
imposed by an authority (government, committee or market). F.A. Hayek, Rules and Order, 1973
Standardization: Process of creating, implementing,
or using a standard
Defining an interface requires developing some definitions. Hayek used the term rule for the application of references. Describe creators, implementers and users.

5. Standardization idea Responsive e.g., ISO Anticipatory e.g., ITU
product/ service
Participatory
e.g., IETF

6. Order and Rules Established by How order occurs Term for order
Physical laws
Inherent
Nature
Convention
Without plan
Reference
Standardization
Private entity
Commercial
Specification
Government
Required
De jure
Regulation
Formal stds. body
Consensus
De jure standard
Consortium
Consensus?
Standard
Market
De facto
De facto standard
De facto (market based) and de jure (committee based) are legal terms for standardization process that are difficult to apply in practice.

7. Similarity and Compatibility
Plug 1
Socket 1
The interface is the outline of the plug and the inside of the socket. A software language or operating system environment is a similarity standard. The Application Programming Interface is a compatibility standard.
Plug 2
Socket 2

8. Communications Compatibility
Transmitter
Receiver
Receiver
Transmitter
Transceiver
Transceiver
Interface
Protocol
TCP or UDP or IP is a protocol

9. Successions of References
Succession Examples Purpose Effect
1. Symbols Number systems Identify Barter
2. Measurement Units of measure, Quantify Trade currency
3. Similarity Venetian galleys, Replicate Increase ISO 9000, 14000, efficiency Manufacturing
4. Compatibility Railway gauge, Interworking Transfer G3 facsimile, Gillette razor and blade, air interfaces
5. Adaptability Etiquette, Negotiate Support Modem handshakes, variation change SIP, G3 fax T.30

10. History and Impact of Successions
Age
Hunter Gatherer Agrarian Industrial (before 3000BC) (3000 BC AD ( )
Succession of Symbols
established references
Economic self- Communications
reinforcing mechanism
Authorities’ involvement Dominate
in establishing references
New policy Trading

11. History and Impact of Successions
Age
Hunter Gatherer Agrarian Industrial
(before 3000BC) (3000 BC AD) ( )
Succession of Symbols Measurement
established references
Economic self- Communications Coordination effects
reinforcing mechanism
Authorities’ involvement Dominate Authoritarian
in establishing references
New policy Trading Taxation

12. History and Impact of Successions
Age
Hunter Gatherer Agrarian Industrial (before 3000BC) (3000 BC AD) ( )
Succession of Symbols Measurement Similarity
established references
Economic self- Communications Coordination effects Scaling and learning
reinforcing mechanism effects
Authorities’ involvement Dominate Authoritarian Oversight
in establishing references
New policy Trading Taxation Patents

13. History and Impact of Successions
Age
Agrarian Industrial Information
(3000 BC AD) ( ) ( )
Succession of Measurement Similarity Compatibility
established references
Economic self Coordination Scaling and learning Network
reinforcing mechanism effects effects effects
Authorities’ involvement Authoritarian Oversight Representative
in establishing references
New policy Taxation Patents Commercial systems

14. History and Impact of Successions
Age
Industrial Information Post-Information
( ) ( ) (2000 +)
Succession of Similarity Compatibility Adaptability
established references
Economic self Scaling and Network effects Gateway effects
reinforcing mechanism learning effects
Authorities’ involvement Oversight Representative Future: Guidelines?
in establishing references
New policy Patents and Commercial Trademark
copyright systems

15. Insights Offered by the Succession of Standards
• Adaptability standards support trademark value system
• Adaptable standards allow open systems
• Patents best applied to similarity
• Need to limit patents that read on compatibility
• Need to avoid patents that read on adaptability

16. Ken Krechmer e-mail: krechmer@csrstds.com http://www.isology.com
Thank you
Ken Krechmer

17. Part II Adaptable Standards support Open Systems

18. Once all stakeholders participated in standardization:
Users/carriers
Implementers
Government
Academia
Railroad track and equipment are examples of early standards and standardization committees
Now implementers dominate the
standardization processes.

19. This creates the desire for “open standards.”
When implementers do not address everyone’s needs, some are disenfranchised.
This creates the desire for “open standards.”
Note that open systems (changeable) are not the same as open standards (fixed for a period) although open systems should (IMHO) require open standards.

20. Open Standards mean different things to different people
Implementers want:
• A single process for worldwide
standards
• A fair process to negotiate intellectual
property rights (IPR)

21. Users/carriers want:
• Backward and forward compatibility
• Maintained standards
• Public technology (low IPR fees)

22. • A fair, fast and efficient standardization system.
Government wants:
• A means to address the standardization aspects of political problems.
Everyone wants:
• A fair, fast and efficient standardization system.
Political issues include pornography, security and safety

23. Ten Parameters of Open Standards
Requirements
Stakeholders
1. Open meeting
2. Consensus
3. Due Process
4. Open World
5. Open IPR
6. Open Change
7. Open Documents
8. Open Interface
9. Open Use
10. On-going Support
Creation
Implementation
Use

24. 4. Open World – same standard for the same function, world-wide
4. Open World – same standard for the same function, world-wide. ANSI and WTO supported
Discuss first three, then discuss value of 4 for creators, implementers and users

25. 5. Open IPR – holders of Intellectual Property Rights (IPR) identify themselves during the standards development process.
This does not work as well with compatibility standards as with similarity standards. How many think that IPR that reads on public standards should be free? Versions of IPR control that attempt to balance the desires of inventors and users include Reasonable And Non-Discriminatory (RAND) and Fair RAND that relate to Standards Essential Patents (SEP).

26. 6. Open Change – all changes are presented and agreed in a forum supporting the previous five rights.
Without this, interfaces are controlled by the supplier who maintains the ability to automatically update the system.

27. 7. Open Documents – all may access committee documents, drafts and completed standards.
Many SDOs still make some portion of their income selling standards documents. But this income is in decline.

28. 8. Open Interface – Adaptability standards support migration and allow proprietary advantage.
This is not understood.

29. 9. Open Access – objective conformance mechanisms for implementation testing and user evaluation.
Certification, plug fests, third party evaluation

30. 10. On-going Support Phase Activity Description Major Interest Group
Create Standard
The initial task of SSOs
Creators 1.
Fixes (changes)
Rectify problems
Implementers 2.
Maintenance (changes)
Add new features and update
Users 3.
Availability (no changes)
Continue to publish 4.
Rescission
Removal of the published standard

31. Broad View of Interfaces
Legitimate Legitimate
Public Private
Good Gain
Fair
Interface

32. Part III Changes in Policy

33. Changes to Standardization Organizations
Require adaptability standards
Allow controlled IP only as an option in compatibility standards
Publish how they address the 10 requirements of open standards
User participation in the maintenance of standards

34. Changes to WTO Policies
Define as barriers to trade the lack of open change procedures and lack of open interfaces of microprocessor-based compatibility standards

35. Changes to Competition and Antitrust Policy:
When interfaces are required to support competition, empower a standardization organization to create and maintain them.

36. Changes to WIPO Policies:
WIPO should evaluate the economic basis of IPR claims on international interface standards and make recommendations concerning when controlled technology should be optional in interface standards.

37. Changes to Individual Countries’ Patent Policies:
Require greater demonstration of uniqueness for patent claims that control interfaces.
Shorter term on patent claims that may control interfaces (e.g., algorithm implementations)

38. Part IV Adaptable Systems

39. Problems With Controlled Interfaces
•The EU's concern that Google dominates the internet
search market
•The Chinese government's desire for their own com-
munications technology in Chinese communications
systems.
• Earlier EU and US anti-trust actions over Microsoft's proprietary software interfaces.

40. Adaptability includes three processes:
The means to create and maintain interoperation between autonomous heterogeneous systems at all OSI layers.
Adaptability includes three processes:
• Identification
• Negotiation
• Selection

41. Creating Adaptability
OSI layers
Negotiation means: 7 6 5
4 TCP/UDP
3 IP 2 1
Service discovery protocols
Etiquettes
(Network discovery protocols)
Existing discovery protocols include Jini, Universal Plug and Play, Service Location Protocol (RFC 2608) and Bluetooth SDP. Session Initiation Protocol (SIP, RFC 3261) may also be seen as a discovery protocol.

42. The properties of an etiquette include
Negotiation services without operational functions.
Single tree, unambiguous, logical structure.
Deletions are not allowed.
An etiquette receiver ignores what it does not understand (new type of testing).
Means to prioritize each branch.
Supports proprietary functionality.
Etiquette revision level. .

43. The Benefits of Adaptability - 1
Supports the rapid introduction of new technology.
Supports proprietary, national and regional functions and features within public standards.
Supports negotiation of modes, features and options.
Selects compatible modes between different multi-mode systems while increasing system capacity.

44. The Benefits of Adaptability - 2
Maintains interoperation between multiple implementations or revisions of standards.
Moves intellectual property issues to the market.
Identifies the specific reason(s) when interoperation fails.
Avoids interfering communications.

45. Ken Krechmer e-mail: krechmer@csrstds.com http://www.isology.com
Thank you
Ken Krechmer