International Journal of Global Business and Competitiveness
Year : 2010, Volume : 5, Issue : 1
First page : ( 37) Last page : ( 46)
Print ISSN : 0973-4619. Print ISSN : 0976-1888.

Global Consortium Standardization and IPRs Management -The Case of DRAM Industry-

Arai Masashi, Assistant Professor

Rikkyo University, Japan. Email: arai@rikkyo.ac.jp.

Abstract

This paper discusses the role of consensus standardization in the management of technology by companies. Modern business environments embrace both competition and cooperation, and standardization is regarded as an important competitive advantage for companies. Some high-tech industries establish consortia and decide common standards for all companies in an industry. However, this standardization process would not lead to competitive advantage for each company because companies cannot take advantage of their own technologies and patents for differentiation.

Companies need to cooperate with competitors for using their IPRs (Intellectual Property Rights) to avoid patent litigation among competitors for time-to-market advantage. In the semiconductor industry in particular, companies that acquire significant patents that become required standards find themselves in the tragedy of the anti-commons. They choose consensus standardization in industry consortia not only in order to speedily and reliably determine a standard but also to manage members’ patents rights efficiently and reasonably. However, consensus standardization impedes differentiation among competitors, even in high-tech industries. While standardization is important for the commercialization of products, consensus standardization is a means of cooperation.

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Keywords

Consensus Standardization, Patents, RAND, Technology Competition and Cooperation.

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