If given the option, SDOs, will privatize.
Simcoe 05 – Professor of Strategic Management at the University of Toronto, PhD in Business Administration and M.A. in Economics from the University of California at Berkeley.
Tim Simcoe, “Chapter 8: Open Standards and Intellectual Property Rights,” Open Innovation: Researching a New Paradigm, 09-16-2005, https://people.bu.edu/tsimcoe/documents/published/OpenStandards_IPR.pdf
While new standards can emerge from a market-based technology adoption process, this chapter focuses on the role of voluntary Standard Setting Organizations (SSOs). These organizations provide a forum where firms can collaborate in the design and promotion of new compatibility standards. Most SSOs promote the adoption of open standards— where the term “open” implies that technical specifications are widely, perhaps even freely, available to potential implementers.i However, open-ness can pose a dilemma for individual firms hoping to benefit from SSO participation. While open-ness increases the probability of coordination on a particular standard (and hence its total expected value), it can also increase the intensity of competition, making it harder to capture that value once the new specification new standard is introduced. As a result, SSO participants are often tempted to take actions that “close off” a standard when those actions also give them a competitive edge in the standards-based product market. To put it crudely, SSO participants usually want all of the technology needed to implement a standard to be open—except for their own.