For my PhD I am looking for a (or rather more) specific example(s) where the benefits of standard setting are more or less visible.
What do I mean?
There are many theories on standard setting with the main idea that standardization solves a coordination problem, i.e. it helps the society to settle down quickly with a given standard, and use all the benefits of the associated network effects, innovation, etc…
The other side of this question is what would happen in a given case without a standard? We have heard about standards wars (e.g. Internet Explorer Vs Netscape) or more peaceful battles (e.g. VHS Vs Betamax, Blueray Vs HD-DVD).
Then there are cases where the users multihome. That is many of us uses Google Chat, MSN and Skype as well, just because 2% of our friends is present only on one of them. In this situation there is neither a standard nor a war, even though it might (have helped) help the society as a whole.
I am from Europe, and frankly, I have no clue for example about the state of the US 2G mobile phone market. The only thing I know is that you lagged Europe with a couple of years and that while in Europe we had a common standard from the beginning (the GSM), you have had many competing standards. Was there a war? Was it good? Why were you behind us (in coverage, bandwidth, etc)?
Anyway, in the previous cases standards are finally not necessary (even though they might be helpful) as users can either multihome, or by the time a standards war is over only one participant remains active. So basically from this we might conclude that the only reason for standard setting is to lower the costs of standard wars and find occasions where a common standard is better than multihomeing.
Unfortunately, I was thinking hard about situation, but couldn’t come up with any examples where the costs of not having a standard were really high. Do you know any? Please, share it with me!
(Of course, one might argue that we don’t see these high costs because the our standards institutions work well. I am interested in the exceptions to this rule.)
Please, if you know someone who might be happy to help me out, post him this link! Thank you.