Innovating Standards Through Informal Consortia: The Case of Wireless Telecommunications

40 Pages Posted: 22 Jun 2012 Last revised: 4 Sep 2021

See all articles by Henry Delcamp

Henry Delcamp

ESCP Europe

Aija E. Leiponen

Cornell University - School of Applied Economics and Management

Date Written: June 2012

Abstract

We empirically examine the effects of industry consortia on the coordination of innovation strategies of the members. Our analyses utilize membership data from 32 consortia in wireless telecommunication technology subfields from 2000 to 2005 and prior art citations in standards-essential patents. We find that connections among firms in informal technically-oriented consortia significantly increase the likelihood that firms cite each other's patents in subsequent patents essential for the UMTS wireless telecommunication standard. Inventions that are likely to become part of the UMTS telecommunication system tend to build on inventions by firm peers who were members in the same consortia, controlling for patent or firm fixed effects, technology class, and other characteristics. Consortia may enhance productivity of invention and increase the incentives to invest in R&D by internalizing potential externalities. They may also enhance efficiency of standardization by facilitating the interaction of committee and market processes. Consortia thus structure and constrain the process of innovating standardized technologies. This is problematic if consortia are not truly accessible for all the relevant parties. Policymakers thus need to balance these effects. For managers, the results show that participation in a variety of technical consortia enables influencing peers' innovation strategies related to compatibility standards.

Suggested Citation

Delcamp, Henry and Leiponen, Aija E., Innovating Standards Through Informal Consortia: The Case of Wireless Telecommunications (June 2012). Available at SSRN: https://ssrn.com/abstract=2089251

Henry Delcamp (Contact Author)

ESCP Europe

79, avenue de la République
Paris, 75011
France

Aija E. Leiponen

Cornell University - School of Applied Economics and Management ( email )

310 Warren Hall
Ithaca, NY 14853
United States
607-255-7588 (Phone)
607-255-9984 (Fax)

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