The Chinese government is showing considerable interest in ICT standardization. The Chinese State Council’s official policy clearly states a long term goal to reduce dependency of foreign ICT technology and to reduce payments to foreign innovators.
Chinese development has been exceptional over the last two decades, largely due to governmental export promoting policies driving the country down a fast track of modern development. A Gartner report states the rapid growth of Chinese ICT has resulted in the world’s most extensive telecom networks. China can also boast with the second largest number of Internet users, despite penetration below 25 percent (http://www.gartner.com/DisplayDocument?doc_cd=138280). Clearly, China will be an increasingly important market for ICT technologies.
ICT is a strategic sector for China. Policy is designed to meet various goals. Several technical committees are driving the standardization process. The common objective is to develop standards based on domestic innovations and intellectual property.
The Chinese government has formulated two key needs for the ICT sector. The first is to reduce the cost of foreign technology, particularly by reducing the burdened of royalty payments to foreign IPR holders by Chinese businesses, for example in the DVD industry. Second, some areas within the ICT industry suffer from dependency on foreign standards not adapted to Chinese interests. The idea is to increase the development and use of domestic standards (see newsletter on www.china-eu-standards.org).
So what effects can be expected from this level of political involvement? First and foremost the classification of ICT as a strategic sector is implies continued governmental and political interest. This could politicize standardization to the point where it risks creating conflicts of interest on the global political stage.
This would be in stark contrast to the globally accepted process today. There is an obvious risk of market distortion and technological fragmentation in the global ICT industry, if foreign innovators and firms meet barriers to entry in Chinese markets. Foreign ICT companies may find it too costly to adapt their products to Chinese standards, which would impede international trade and global specialization. Extensive political involvement and strategic use of standardization in China could also have political implications. “Strategic policies” relating to trade and investment can easily spread to other countries, including Europe and the USA, with very undesirable consequences.
International collaboration and competition is imperative for the future development of the global ICT sector. Thus, integrating China in the market based standardization process predominant in OECD countries should be a political priority for the governments in USA and EU.
See also “How much politics in web standardization?” http://www.talkstandards.com/?p=1288