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Co-opetition in Standard-Setting: The Case of the Compact Disc

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Author Info
Tobias Kretschmer () (London School of Economics)
Katrin Muehlfeld () (London School of Economics)

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Abstract

The success of the CD has (partly) been attributed to the ability of Sony, Philips and Matsushita to cooperate in the run-up to the DAD conference in 1981, where the technological standard was set. We model the situation leading up to the conference in a simple game with technological progress and the possibility of prelaunching a technology. We identify players' tradeo s between prelaunching (which ends technological progress) and continued development (which involves the risk of being pre-empted). Contrasting outcomes with complete and incomplete information, we nd that there appeared to be considerable uncertainty about rivals' technological progress.

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Paper provided by NET Institute in its series Working Papers with number 04-14.

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Length: 32 pages
Date of creation: Oct 2004
Date of revision: Oct 2004
Handle: RePEc:net:wpaper:0414

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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Joseph Farrell and Garth Saloner., 1988. "Coordination through Committees and Markets," Economics Working Papers 8864, University of California at Berkeley.
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  2. Joseph Farrell & Garth Saloner, 1985. "Installed Base and Compatibility With Implications for Product Preannouncements," Working papers 385, Massachusetts Institute of Technology (MIT), Department of Economics.
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  3. Cabral, Luis M. B., 2000. "R&D cooperation and product market competition," International Journal of Industrial Organization, Elsevier, vol. 18(7), pages 1033-1047, October. [Downloadable!] (restricted)
  4. Funk, Jeffrey L. & Methe, David T., 2001. "Market- and committee-based mechanisms in the creation and diffusion of global industry standards: the case of mobile communication," Research Policy, Elsevier, vol. 30(4), pages 589-610, April. [Downloadable!] (restricted)
  5. Joseph Farrell & Garth Saloner, 1984. "Standardization, Compatibility and Innovation," Working papers 345, Massachusetts Institute of Technology (MIT), Department of Economics.
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  6. Fudenberg, Drew & Tirole, Jean, 1985. "Preemption and Rent Equilization in the Adoption of New Technology," Review of Economic Studies, Blackwell Publishing, vol. 52(3), pages 383-401, July. [Downloadable!] (restricted)
  7. Katz, Michael L & Shapiro, Carl, 1985. "Network Externalities, Competition, and Compatibility," American Economic Review, American Economic Association, vol. 75(3), pages 424-40, June. [Downloadable!] (restricted)
  8. Besen, Stanley M & Farrell, Joseph, 1994. "Choosing How to Compete: Strategies and Tactics in Standardization," Journal of Economic Perspectives, American Economic Association, vol. 8(2), pages 117-31, Spring. [Downloadable!] (restricted)
  9. Katz, Michael L & Shapiro, Carl, 1986. "Technology Adoption in the Presence of Network Externalities," Journal of Political Economy, University of Chicago Press, vol. 94(4), pages 822-41, August. [Downloadable!] (restricted)
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  1. Heli Koski & Tobias Kretschmer, 2006. "Innovation and Dominant Design in Mobile Telephone," Discussion Papers 1012, The Research Institute of the Finnish Economy. [Downloadable!]
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  2. Prasenjit Mitra & Sandeep Purao & John W. Bagby & Karthikeyan Umapathy & Sharoda Paul, 2005. "An Empirical Analysis of Development Processes for Anticipatory Standards," Working Papers 05-18, NET Institute, revised Oct 2005. [Downloadable!]
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