Open IT Standards Would Benefit Developing Countries

1 November 2007

While developing countries have taken many measures to improve their integration into the knowledge society, many have largely overlooked one of the most useful tools: open information technology standards.

Information technology (IT) standards are the co-operation agreements, or specifications, that make networked computing possible. In a network such as that embodied by the Internet – and the myriad applications and devices that use it – the standards that matter most are the ‘interfaces’ that enable technology users to access their data within the network, regardless of their choice of computing product or platform.

What Are Open Standards?

‘Open’ IT standards are not encumbered by legal or technical constraints, nor do they provide a unique advantage to any party. Contrary to popular belief, there is no guarantee that an IT standard is truly non-discriminatory and ‘open’ just because it is called a standard; was approved by a particular organisation; is supported by a set of vendors, or; is licensed under ‘reasonable and non-discriminatory’ terms. The original goal of IT standards was to enable unfettered integration and interoperability on the network. However, with the introduction of software patents and the network’s increasing value, companies now often use these standards to manipulate the direction of the network, and sometimes even to gain illegal competitive advantage. Indeed, recent court cases – such as the US Federal Trade Commission with RAMBUS, the US Federal Appeals court ruling against Qualcomm, and even the European Court of First Instance ruling against Microsoft – show that governments and the public are starting to wake up to this disintegration of trust in the standardisation system and the value of interoperability. Some governments are beginning to investigate how this problem might be addressed through competition law (Bridges, Year 11 No. 4, page 17).

What Is Being Done?

To mitigate the exclusionary effects of IPRs embedded in international standards, standard-setting organisations have adopted guidelines that require their mem bers to disclose patented technology that is ‘necessary for the implementation of a standard’ before the standardisation process has been completed. Such technology should be made publicly available under ‘reasonable and non-discriminatory terms and conditions’.1

However, these policies beg a host of questions. Who defines – and how – what a ‘reasonable’ cost is? Since such terms are almost always covered by confidentiality clauses in legal contracts, how can anybody know if they really are non-discriminatory? Who polices the implementation of these terms? Can they change over time and, if so, how? Are these terms explicitly and publicly known before the standard’s adoption? And how could precluding open source code implementations ever be justified under the spirit of ‘reasonable and non-discriminatory’ licensing?

Why Does ‘Openness’ Matter?

IT is increasingly embedded into our daily lives and continues to meld with traditional industries and applications such as healthcare, transportation, media, security, and telecommunications. Battles over non-interoperability and consumer access due to a lack of open IT standards are popping up in unexpected places. The automotive repair industry provides a good example of this: consumers and non-dealer-owned repair shops are fighting for access to technical interface information required for diagnosing and repairing cars, which are quickly becoming computers on wheels. Another example is the global debate around varying levels of ‘openness’ in standardised office document formats.

Open IT standards directly benefit society by driving innovation while mitigating adoption risks. Multiple, competing implementations – and interchangeability between these implementations – mean prices drop while innovation flourishes. In a competitive market, consumers and small businesses are more likely to find the product that suits their needs, depending on factors such as price or availability in a native language. Should their needs change, they can more easily switch to another product. A corollary benefit to this is creator/user control of data.

The lack of open IT standards can act as a trade barrier if it denies market access for companies or even whole economies (this point has been raised by China and others in the WTO Committee on Technical Barriers to Trade). A particularly onerous burden is placed on developing economies when their consumers and businesses have to pay royalties or meet other terms and conditions in order to use IT standards that are not truly open but still necessary to participate in the network. After all, patents are a limited monopoly granted by a government. Embedding patents into technical standards that are required for effective participation in the information society overextends this monopoly.

Lastly, there are other standardisation-related problems that contribute to the low participation of developing countries in the global information society. While these undoubtedly stem from where countries stand in their IT adoption/diffusion ‘lifecycle’, many of them miss out on the standards-creation process itself. Their concerns must be taken into account; after all, they include the majority of the world’s consumers and – hopefully soon – the majority of the world’s IT users and innovators.

Susy Struble works for the Global Government Strategy group at Sun Microsystems. Robin Gross is the Executive Director of IP Justice and Thiru Balasubramaniam is the Geneva representative for Knowledge Ecology International.

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