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Competing on Standards? Entrepreneurship, Intellectual Property and Platform Technologies

In: Entrepreneurship: Strategy and Structure

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Listed:
  • Timothy S. Simcoe
  • Stuart J. H. Graham
  • Maryann P. Feldman

Abstract

Entrepreneurs often rely on intellectual property (IP) to earn a return on their innovations, and also compatibility standards, which allow them to supply specialized components for a shared technology platform. This paper compares the IP strategies of small entrepreneurs and large incumbents that disclose patents at 13 voluntary standard setting organizations (SSOs). These patents have a relatively high litigation rate. For small private firms, the probability of filing a lawsuit increases after disclosure to the SSO. For large public firms, the filing rate is unchanged. Although forward citations increase after disclosure for all firms, the size of this effect is the same for entrepreneurs and incumbents. These results suggest that standards increase the difference between large and small firms’ incentives to litigate, rather than the relative value of their patents. We conclude that because specialized technology providers cannot seek rents in complementary markets, they defend IP more aggressively once it has been incorporated into an open platform.
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Suggested Citation

  • Timothy S. Simcoe & Stuart J. H. Graham & Maryann P. Feldman, 2007. "Competing on Standards? Entrepreneurship, Intellectual Property and Platform Technologies," NBER Chapters, in: Entrepreneurship: Strategy and Structure, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberch:3052
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    More about this item

    JEL classification:

    • L0 - Industrial Organization - - General
    • L17 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Open Source Products and Markets
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
    • O34 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Intellectual Property and Intellectual Capital

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