Co-ordination in Ict Standards Setting

The complex web of standards setting bodies (SSBs) has triggered the need for co-operation and co-ordination in ICT standards setting at various levels. This paper looks at the co-ordination between SSBs, and proposes some improvements to the current situation. It also argues that SSBs need to coordinate with their stakeholders. This need is derived from a small qualitative study, which is briefly presented. It turns out that SSBs need to be flexible enough to constantly adapt to their stakeholders needs. Division of labour and improved transposition processes might help improve the current situation. Moreover, European policy makers might need to re-evaluate their stance towards standards consortia. 1 A Very Brief Introduction Over the last decades a huge number of consortia and industry fora have entered the ICT standards setting arena. As a result, companies are today faced with an almost impenetrable web of standards setting bodies (SSBs), with complex inter-relations. Each of these bodies has its own membership, works within its own environment, and has defined its own set of rules. The resulting fragmentation of the standardssetting arena, and considerable overlap of the activities of individual SSBs, means that interoperability between standards from different sources cannot necessarily be assumed. Accordingly, improving co-ordination in ICT standards setting has become a major issue. At the same time, however, we may observe fierce competition in standards setting. Initially, in the eighties consortia invaded the standardisation territory, which had always been the SDOs’ monopoly. This move was also helped by the deregulation of the telecommunication sector. Eventually, the SDOs started fighting back. As a result, these days competition may occur between working groups of different SSBs, and between entire SSBs which cover largely the same ground. In addition, though, WGs of the same SSB may also compete. And finally, competition may occur within a working group, between individuals with different ideas, agendas, and mindsets. Companies that wish to implement a standard, or to contribute to developing one, have in many cases very specific needs an requirements that go well beyond technical the excellence of a standard. Accordingly, aspects like, for example, IPR regime, membership, and governance, of an SSB are playing a crucial role. Such characteristics contribute to a certain ‘credibility’ of an SSB (or the lack thereof), and may thus also be deployed by SSBs to attract a certain market segment, or a certain type of company. 1 Standards Developing Organisations, i.e., the ‘formal’ bodies like e.g. ISO and ITU at the global level, CEN and ETSI at the European level, and the various national bodies. The remainder of the paper will first (in section 2) provide a little necessary background of the current diversity in ICT standardisation, and discuss its pros and cons. Subsequently, co-ordination between SSBs will be discussed section 3. The paper argues that SSBs also need to co-ordinate with their stakeholders; why this is the case, and what needs to be done here is discussed in section 4. Finally, some concluding remarks will be provided in section 5. 2 Diversity in ICT Standardisation 2.1 The Emergence of Diversity Over the last three decades, the world of ICT standardisation has changed dramatically, from the fairly simple, straightforward, and static situation that could be found in the seventies (see Figs. 1 & 2 below; both are not complete, though). Back in the seventies, there was a clear distinction between the then ‘monopolist’ CCITT on the one hand, and the remainder of the world of ICT standards on the other. CCITT were in charge of standards setting in the telecommunications sector. They was basically run by the national PTTs, which still enjoyed a monopoly situation in their respective countries. ISO was in charge of almost all other ICTrelated standardisation activities. The various national SDOs developed their own specific standards, but also contributed to the work of ISO. Figure 1: The ICT standardisation universe in the seventies (excerpt) Over time, two trends contributed to an increasingly complex ICT standardisation environment: • the growing importance of ICT, • the globalisation of markets. In a way, these were coupled, and further accelerated, by the Internet, which was ‘discovered’ for commercial use in the mid-nineties. Further complexity was caused by the liberalisation of the telecommunications markets and the associated emergence of regional bodies, such as ETSI in Europe, and ATIS in the US and TTC in Asia. This was reinforced by the still ongoing 2 International Telegraph and Telephone Consultative Committee, the predecessor of the ITU-T. 3 Some related activities were also carried out within IEC, the International Electrotechncial Commission. 4 Alliance for Telecommunications Industry Solutions. merger of the formerly distinct sectors of telecommunications and IT, which caused considerable changes in these markets [David, 1995]. Figure 2: The ICT standardisation universe today (excerpt) These processes affected primarily SDOs and the relations between them. In addition, and as ‘external’ competitors, standards consortia emerged as a new phenomenon. Well-known examples today include, for instance, the W3C (the World Wide Web Consortium), OASIS (the Organization for the Advancement of Structured Information Standards), or OMG (the Object Management Group). Also, the economic importance of standards grew. A system ‘ennobled’ by having become a standard held the promise of huge financial gains for its proponents. Likewise, backing a loosing system would imply both severe monetary losses and a severely reduced market share for its supporters. In an attempt to save the day, new consortia could be established to standardise the loosing system. Obviously, this approach increased the number of consortia and led to an even higher complexity of the standards setting environment. As a result, for a number of years consortia emerged an amazing rate [Cargill, 1995]. This was largely in response to the enormous speed of technical development in ICT systems. ‘Traditional’ SDOs were widely considered as not being capable of coping with this speed (see e.g., [Besen, 1995], [Cargill, 1995]). However, it seems the situation is beginning to change – the number of ICT consortia found in 2004 was down by around 20% (to 190+) compared to the 2003 figure [ISSS, 2004]. This is mostly due to ‘mergers’ of consortia, i.e., attempts to reduce competition. To further increase complexity, a proliferation of sector-specific standards may be observed in Europe, especially in the e-business domain. The most prominent 5 Telecommunication Technology Committee. 6 Please note that neither does this figure show all relevant SSBs, nor all links that exist between individual SSBs (which may change over time anyway). 7 Whether or not this view is justified is a matter of debate. For a slightly different view see e.g., [Sherif, 2003] and [Jakobs, 2002]. representatives here include CEN/ISSS Workshop Agreements (CWAs), many of which have been tailored towards the needs of a dedicated industry sector. One effect, which was a direct result of the trends outlined above, is that many companies, especially large manufacturers and service providers, are forced to participate in a much higher number of SSBs than they used to, to make sure that they do not miss a potentially relevant development (see e.g., [Updegrove, 2003]). The Internet’s standards body, the IETF, should also be mentioned. This body plays a somewhat special role thanks to the unprecedented importance of the Internet in today’s economy. For many years the IETF had not been accepted as a standards setting body, and its output, the Internet Standards, were not recognised by government procurement regulations [Werle, 2002]. This has changed by now, though. Also, the IETF may be regarded as the role model for many large consortia, such as the W3C and OASIS, which have based their processes on that of the IETF. In fact, many have considered the IETF’s process as superior to those of the formal SDOs (see e.g., [Crocker, 1993], [Monteiro, 1995], [Solomon & Rutkowski, 1992]). 2.2 Evaluating the Diversity The complex environment outlined above represents a major obstacle for those who are considering active participation in standardisation, as well as for those who are looking for standard that best suits their needs. Considering this complexity of the IT standardisation universe, “Where to participate?” is a relevant question. Functionally equivalent systems may well be standardised in parallel by different SDOs and consortia, and participation in all relevant work groups is well beyond the means of all but the biggest players. The correct decision here is crucial, as backing the wrong horse may leave a company stranded with systems based on the ‘wrong’ (i.e., non-standard) technology. In addition to the more practical aspects that need to be considered when selecting the best suited SSB for particular standards setting activity other, less tangible aspects may play a role in such decision processes, too. In particular, this may include the perceived reputation of an SSB. Perceptions of the importance and relevance of different types of SSBs differ widely. For instance, Rutkowski offers a rather extreme point of view – “The Internet standards development process is by far the best in the business.” [Rutkowski, 1995]. However, things have changed since the times when the IETF on the one hand and ISO and CCITT on the other were basically the only players in the international ICT arena. These days, the IETF is one of a number of accepted members of the global web of standards setting bodies. Likewise, the role of the national SDOs has changed. This holds particularly for Europe, where 90% of standards produced are European or international (as opposed to national; this ratio has changed dramatically within a couple of years) [Bilalis & Herbert, 2001]. Along similar lines, Ghiladi fears that “... non-harmonized national standards and rules have the effect of erecting barriers.” [Ghiladi, 2003]. Moreover, in an attempt to improve their position in the competition with consortia many SSBs have introduced ‘new deliverables’. These are documents which do not 8 The Internet Engineering Task Force. 9 See [Jakobs, 2003] for a different point of view. have gone through the full-blown process that leads towards a ‘Standard’, but are more akin to the specifications issued by consortia (i.e., e.g., they require only a lower level of consensus, and can be published quicker). Obviously, this move has introduced further complexity into standardisation. Many consortia and other SSBs outside the network of formal SDOs have established themselves as recognised sources of standards. Initially, though, their output was considered ‘inferior’ to that of the formal bodies, which had major repercussions, e.g. in (public) procurement (see e.g., [Heafner, 1988], [Werle, 2002]). Here, Europe’s commitment to OSI in the 1980-90s was a remarkable example. In addition to its undoubted technical superiority, one of the major reasons why OSI standards were considered preferable to their Internet counterparts was the fact that ISO, where the OSI standards were developed, was a formal SDO, unlike the IETF, which was viewed with considerable suspicion. Similar views could be observed in the private sector. A standards inventory project in the US petrochemical industry, for instance, established rules where “... preference was given first to international standards, followed by national standards, and then consortium specifications.” [Kowalski & Karcher, 1994]. Yet, by now Europe has recognised that: “... consortia and fora are playing an increasing role in the development of standards, .... the European Standards Organisations have to recognise these facts and re-design policies, processes and organisational structures, in close collaboration with stakeholders and in particular industry ... “[EC, 2004b], albeit with some concern: “It is considered doubtful whether, in the light of the speed of development and the limited participation of experts, the fundamental principles for accountability of standardisation such as openness, consensus and transparency are followed in a robust fashion.“ ([EC, 2004a]; see section 4 for a sketch of the industry’s view on this). Interestingly, this position has been challenged in [Egyedi, 2003], stating that democracy should not necessarily be required from consortia processes. 3 Co-ordination in Standardisation Standardisation is basically a mechanism for co-ordination [Werle, 2001], [Shapiro, 2001]. Not unlike the research sector, standards setting serves as a platform for cooperation between companies which are otherwise competitors. This function of standardisation is largely independent of the nature of the actual platform; that is, it doesn’t make a big difference whether negotiation and co-operation occur within a formal SDO or an industry consortium. Yet, the complex structure of the web of SSBs described above suggests a considerable amount of fragmentation and overlap of standards setting activities. In fact, this occurs at different levels • Between SSBs Typically, several SSBs are active in similar and overlapping domains. As a result, there may well be competition either generally between SSBs covering similar ground (RosettaNet and ebXML would be an example here), or temporarily between SSBs working on similar projects (e.g., the IEEE 802.11a/b/g standards and ETSI’s HIPERLAN/2).