Coalition Formation for a Consortium Standard Through a Standard Body and a Patent Pool: Theory and Evidence from MPEG2, DVD and 3G
AbstractWe examine why cooperation among essential patent holders for a standard may not occur, despite significant gains for patent holders and users of the standard. Utilizing Maskin's (2003) framework, we show that a grand coalition can be implemented only if the number of patent holders (n) is small. When n is large, emergence of an outsider is inevitable, so that voluntary sequential negotiation cannot secure the socially efficient outcome. We also show that a firm specialized in research is more likely to become an outsider. We discuss the MPEG2, DVD and 3G patent pools in light of these results.
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Bibliographic InfoPaper provided by Institute of Innovation Research, Hitotsubashi University in its series IIR Working Paper with number 05-01.
Length: 25,  p.
Date of creation: Feb 2005
Date of revision:
Note: Presented to the Conference on IT Innovation, Tokyo, December 2004.
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