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   RE: Microsoft's Role in the XML Community (WAS RE: Important: The SAXC+

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  • From: Eric Bohlman <ebohlman@netcom.com>
  • To: Wendell Piez <wapiez@mulberrytech.com>
  • Date: Mon, 19 Jun 2000 10:43:21 -0700 (PDT)

On Mon, 19 Jun 2000, Wendell Piez wrote:
> The same journalist who made the "MS invented XML" gaffe in the Washington
> Post wrote again (I think a week ago), correctly identifying that the core
> issue in the MS anti-trust litigation is, who gets to set (and profit from)
> standards for emerging technologies. He missed one critical detail,
> however, by assuming that standards must always be set unilaterally by a
> dominant company. I think history would show it to be more mixed than that
> -- for example, the technical standards for the broadcast industry, were
> they set by CBS?

In fact, the development of television broadcast standards was a perfect
example of a case where a small dose of (gasp!) government regulation
greatly enhanced the ability of the private sector to create value.  In
the US, the FCC basically told the fledgling broadcast industry that it
would approve *one* television broadcast standard and it was up to the
industry to create it, rather than having different companies put out
competing standards and let the marketplace pick the winner (the way it
did with AM stereo).  If they had done the latter, someone probably
*would* have come up with a standard that was *technically* superior to
Never The Same Color, but it might well have failed for non-nerdy reasons.

The reason this strategy was so successful is that it eliminated the
chicken-and-egg problems that the "marketplace" approach would have
caused.  In order to have any shot at winning under the latter approach, a
standard would have had to get simultaneous buy-in from

1) TV set manufacturers
2) Transmission equipment manufacturers
3) Program content producers
4) Broadcasters
5) TV set consumers
6) Retailers
7) Advertisers

*all* of whom would be stuck with warehouses full of very expensive boat
anchors, and libraries of incompatible programming, if they picked
anything other than the winning format (remember the electronics were a
lot better back then).

Now the situation with Internet standards is rather different as the
chicken-and-egg problem is nowhere near as severe: any effort put into
developing a non-winning standard is at least partially repurposable,
since the "only" thing that would be wasted is human time, and knowledge
gained from a failed project retains its value, unlike manufactured goods
that nobody wants.  In the early days of the Internet, though, the
government played another role, though not a regulatory one; it provided
funding that wasn't tied to non-technological strings, so that competing
proposals could compete on purely technical merits.

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