The Linux Foundation | 15 August 2023
Open standards are the hidden architecture that underpins everything from communication protocols to how our devices talk to one another. These standards provide a shared language that ensures compatibility and drives innovation. However, until recently, there was a significant gap in understanding the attitudes, beliefs, and practices of those involved in creating these vital tools.
Recognizing this gap, the Linux Foundation commissioned the report titled "The 2023 State of Open Standards." Authored by Jory Burson, this groundbreaking report delves into why open standards are crafted, the primary objectives behind the research, and what it means for the future of information and communication technology (ICT).
Here, Jory Burson uncovers her inspiration for investigating the transition to open ICT standards for 2023, revealing what led to the report's creation and its insights and recommendations.
Why was "The 2023 State of Open Standards" report written, and what were the primary objectives of the research?
JB: There’s already a big body of research on open source developers, maintainers, and the many different variables that make that ecosystem tick. In particular, the LF’s annual State of Open Source report has been a great tool for following issues, trends, attitudes, and perspectives over time. We didn’t have something like that for the communities working on open standards and specifications. There are a lot of papers about standards and economic theory, standards and their role in shaping society, standards, and institutions, but I can’t point to any recent papers that survey the attitudes and beliefs of people who participate in making ICT standards. We wanted to explore their motives, understand the value they perceive to derive from standards and learn more about the challenges, issues, and opportunities they face.
As the report's author, what inspired you to investigate the transition to open information and computing technology standards for 2023?
JB: People think of standards development as something that doesn’t really change, but that’s not true at all - we’re making new standards all the time for increasingly complex needs and goals. The evolution towards open ICT standards reflects a broader cultural shift towards transparency, collaboration, and democratization. Unlike proprietary standards, open standards are developed through a community-driven process, ensuring diverse input and perspective. This fosters innovation and prevents any single entity from having undue influence over the technological direction. Our re-examination was driven by the understanding that open standards are not static; they continue to evolve in response to technological advancements, regulatory shifts, and societal needs.
Open source developers are also influencing the standards development process. They’re getting involved and bringing their open source values, ideals, and expectations. Many organizations that participate in standards development would love to figure out how to accelerate standardization processes (without sacrificing quality and due process, of course). So, there are a lot of dynamic forces at play in standards development right now, and the LF is in a really great spot to help study it.
The report highlights the importance of open standards as "recipes for reality" influencing various aspects of our lives. Could you elaborate on how open standards impact both technical and strategic decision-making for organizations?
JB: Organizations recognize the importance of collaboration and agility offered by open standards. By actively participating in standard-setting bodies and community-driven initiatives, they can influence the direction of these standards and ensure alignment with their business goals. This integration leads to a more dynamic business environment where collaboration, innovation, and adaptability are prized. Moreover, adherence to open standards enhances reputation and trust, making organizations more appealing to clients, partners, and regulators.
When organizations choose open standards, especially those with reciprocal, royalty-free license policies, they strengthen the marketplace in a couple of ways: One, they are reinforcing a technology with a low barrier to entry, which decreases the cost for new entrants and makes the market more efficient. This increases competitiveness and reduces costs, which benefits consumers. Two, when the RF license is reciprocal, the issue of economic free-riding is greatly mitigated because the technology implementers also agree to make their essential IP available to other standard implementers. This reduces cost and risk to implementers while also asking them to contribute to bolstering that ecosystem.
One of the key findings in the report indicates that organizations prefer open standards over more restrictive approaches by a significant margin. What factors contribute to this overwhelming preference for open standards?
JB: Most of our survey respondents identified themselves as developers, engineers, and business leaders, so bearing this in mind, innovation is the main factor driving this preference. Even respondents who reported licensing IP as a significant revenue-generating activity for their organization said that open standards make them more innovative. This is an exciting finding because licensing fees are ostensibly meant to help organizations recoup the cost of their investment and fund future innovative technologies. But here, the respondents say open standards will make them more innovative regardless of the business model.
Competitiveness was another leading factor driving the preference for open standards. Competitiveness concerns how efficiently an organization can bring its products or services to the marketplace. Are they providing benefits that solve the needs and wants of their customers? Are they doing that on fair terms? Respondents reported that open standard solutions make them more competitive in the short and the long term. Other factors that were seen as driving the preference for open standards may also increase competitiveness. For example, many respondents reported that open standards would make them more secure, or improve the overall quality of their technologies. So, while there were clear factors identified in our research, these factors do seem to work together to drive this preference.
The study points out that open standards have become a critical driver of innovation in the IT sector and beyond. How do open source software and open standards complement each other? How has this relationship impacted technological development?
JB: Open source software and open standards are symbiotic. Open standards lay the groundwork, defining the rules, while open source projects provide practical implementations. This interplay encourages exploration and innovation, allowing developers to build on each other's work. It has democratized technology development, reducing barriers to entry, and allowing smaller players to compete with larger entities. By fostering collaboration, this relationship has accelerated technological advancement and made technology more accessible and transparent.
The report mentions that open standards are seen as a solution of choice for organizations' strategic needs. What specific benefits do organizations derive from adopting open standards, and how do these benefits extend beyond the organization's boundaries?
JB: We mentioned the innovation, competition, and security benefits of open standards and how those are connected to an organization’s strategic technological decision-making. While those are most obviously beneficial to the firm, they also benefit consumers because they can get a better solution, a more secure product, or a fairer price, and providers of similar services will have to meet those expectations if they want to enter a market. Other softer benefits of open standards were reported as well, such as making the company a more attractive place to work, improving the firm’s reputation, or just a general sentiment that contributing to open innovation was the right thing to do. Companies don’t just compete for customers; they also compete for talent. So those soft benefits are also highly visible parts of a network of positive effects that arise when industries move to openly innovated technologies: as the firm becomes more competitive and innovative, they become more attractive to prospective employees who may be further interested in working at an organization that allows them to innovate with their peers at other firms, which then raises the reputation of both the firm and its employees, which then increases the awareness of the firm’s innovative products and services, so you can see there’s a positive cycle that starts to build where more open innovation tends to beget reciprocal benefits.
The report also acknowledges the presence of royalty-bearing standards activities despite the overwhelming support for royalty-free open standards. What are some reasons organizations continue to participate in royalty-bearing standards, and how do you foresee the future balance between open and royalty-bearing standards?
JB: Patent licensing is one of the ways organizations get ROI on their tech investments, and for the longest time, it was one of the only well-understood ways. While many of our respondents reported that their organizations earned revenue from patent licensing, 70% reported that their revenue did not come primarily from royalties. Patent licensing is a business model that generally better serves large/enterprise organizations more equipped to diversify their revenue streams and have the resources/ processes necessary to run a licensing program. Patent licensing will always be part of tech strategy for larger organizations with the means to do that work and for smaller organizations or individuals that hit on a bright idea. But we will see open standards succeeding for longer-term needs and across more industries and problem domains. At the same time, patent/license-encumbered standards serve shorter-term innovation or highly-specialized use cases.
Can you share a specific real-world example of how open standards have revolutionized an industry?
JB: Yes, the rise of the AV1 codec in the media codec industry exemplifies how open standards can transform markets. AV1 has democratized access to advanced video compression technology by providing a high-quality, royalty-free alternative. It has also spurred innovation and competition, breaking down barriers and allowing new entrants to flourish. The collective efforts behind AV1 underscore the power of collaboration and the potential of open standards to reshape entire industries.
As a closing question, what implications do you believe this report holds for the future of open standards and the continued evolution of collaborative technology development and innovation?
JB: I’m excited about building on these findings and exploring the relationships between open source, open standards, and an organization’s strategic decision-making and business goals. Reports like the 2023 State of Open Standards can expand awareness and understanding of this market-based rationale for open standards in everyday practice. More broadly, though, and this is very well said in Jochen’s forward to the report, we have to think about sustainability in innovation. The technical challenges we face today are further complicated by the need to ensure the solutions don’t further damage the environment, increase rates of climate change, oppress a group of people, or lead to other threats and harms because we standardized on the wrong thing. There are very real costs and consequences at stake, and the answers to these challenges aren’t going to be found within the four walls of one company. We need the collective knowledge and participation of all stakeholders. As Jochen says, “In this context, only open standards really work well.”