Ajit Jaokar argued that any “standards for standards” effort risked the creation of a “class system between consortia” based on an arbitrary set of criteria and will only be more difficult to apply as new innovation becomes increasingly cross-domain (e-health, Mobile health, etc).

Helen Disney, arguing that the priority of an SSO should be promotion of both competition and innovation, identified the criticism that formal review creates more bureaucracy within the standard setting organisations and as such may slow change in dynamic markets such as the IT sector. However, she also presented the countervailing argument that rankings may provide valuable information that reduces search costs and facilitates the connecting of business with SSOs, and so long as SSOs continue to foster competition and innovation, rankings may be a valuable exercise.

Daminen Gerdin highlighted the significant challenges inherent in the ranking of SSOs, particularly the difficulty in determining first the requisite criteria and secondly the weight to place on each of these criteria in computing any final measure of rank. He further questioned whether such rankings would not do more harm than good. Geradin suggested that rankings may negatively affect diversity and competition between SSOs, by causing poorly ranked SSOs to disappear for the standards setting landscape.

Mattias Ganslandt discussed the 2008 IBM guidelines for SSO membership, which set out a set of criteria required for IBM to take part in an SSO. Ganslandt argued that policies such as this work towards a standardization of the standardization process and may have negative effects on innovation. Forcing SSOs, which differ from each other in many ways, to comply with a set of criteria would not benefit stakeholders, especially not the end-users.

Knut Blind argued that the crucial aspect with respect to ranking SSO is the selection and weighting of the criteria and that such a complex issue would require a broad range of criteria to be integrated. He stressed however that there exists inherent difficulty in defining unique and quantifiable parameters, e.g. for openness.

Steve Mutkoski warned of the dangers of placing “form over substance”, and forgetting the distinction between a successful standard and a successful/“highly rated” SSO. He argued that the main challenge associated with ranking SSOs was not the defining of ranking criteria, but that a single set of criteria and formula through which to pass these criteria will never be able to accurately assessment and compare all SSOs. Furthermore it will miss the intended mark due to its failure to guarantee that individual standards themselves be of high quality, relevant and obtain market acceptance.

Daniel Dardailler (who related his argument to his experience with W3C) suggested that a formalized review process could potentially foster efficient standardization, so long as the process of developing the review criteria and methodology were open and publicly available. Such ranking he claimed could aide stakeholders with their investment choices and allow new consortia gain immediate support provided they follow the criteria. Conversely, Jay Kesan argued that formalized rankings are more likely to hinder standardization than foster it as the criteria developed may be based on factors not common to all SSOs.

The initiative strives to ultimately increase the level of openness throughout the whole process of standards development and was the result of a six-week discussion in 2008, in which 70 independent experts debated whether modern SSOs manage to keep up with reality (commercial, legal, social etc.). Interestingly, the discussion was not open.

As set out in the new policy, IBM will “begin or end participation in standards bodies based on the quality and openness of their processes, membership rules, and intellectual property policies”. Also, IBM will “help drive the creation of clear, simple and consistent intellectual property policies for standards organizations”.

Essentially, the initiative entails IBM leaving its position in SSOs which are not meeting the criteria for openness, set up by IBM. Further, the company will push for adoption of certain protocols, in the SSOs where IBM decides to not withdraw its membership, and will endeavor to persuade developing countries to only adopt standards which are compliant with these criteria.

Several positive reactions were prompted by the release. For example Andy Updegrove welcomed the initiative and called for more influential actors to follow; and Trond-Arne Undheim who in his blog suggested that perhaps this move by IBM would “fix the leaking pipes in the standards world”. They both cite the OOXML vs ODF battle as motivation for the initiative and that the IBM initiative is a move to avoid such issues in the future.

However, the idea of setting certain criteria by which SSOs are to be evaluated is problematic (see Per Andersen study and interview). SSOs differ from each other in many ways, which can manifest themselves in some organizations being more open in one part of the process than in others.

Forcing SSOs to comply with a set of criteria makes the process of standardization itself standardized, which has fundamental implication for institutional competition and innovation. Such a development would not benefit any stakeholder, especially not the end-users.

Back to the forum

Ranking standard-setting organisations (SSOs) would thus raise significant challenges. The first immediate question would be to determine the criteria that would be used to rank SSOs. Such criteria could comprise a large variety of factors, such as participation, openess, fees and costs, adoption speed, successful implementation, etc. A second question would be to decide the relative importance to be given to these factors. Fees and costs may not be an issue for some companies, but it might be for others. Successful implementation is the ultimate goal, but it may not be easy to measure as people may disagree over what “success” means. These challenges would be very serious indeed and may prove unsurmountable.

But even if one could agree on methodology, it remains to be seen whether such rankings would do more good than harm. Well ranked SSOs may become very popular, while poorly ranked SSOs may disappear. This would clearly affect diversity and competition between SSOs. This lack of competition might in turn strengthen the position of firms that dominate a given standard.

For these reasons, a preferable approach would be to develop guidelines as to what how a SSO should ideally operate, but such guidelines should be sufficiently flexible to allow diversity, which is very beneficial in itself.

Back to the forum

That is one of the key conclusions of the World Economic Forum Global Agenda Council on the Future of Government on which I serve. Agree or disagree, one thing is clear: Government has to change to keep pace with the 21st Century.

The digital tsunami pouring over every aspect of the global economy, society and culture has crashed around government. The lifeline that could save government from drowning in irrelevance? Openness…Open Data, Open Access, Open Dialogue, Open Government.

In the current global economic and political environment, the public is demanding transparency and accountability from government. Citizens are demanding that government engage them in open dialogue using new digital, mobile and social media communications tools. Businesses, citizens and media alike are keen to see and “touch” the mountains of information and data collected by government over the years to see what they can make of it. And in the new digital world, if users don’t get what they want or need, they will go elsewhere.

As compelling as the demand side of the “openness” equation is, the opportunities on the supply side of Open Government should alone be enough for governments of all types and sizes to open up now. Early Open Government adopters will not only stave off irrelevance, but enjoy a whole new type of relevance that will fundamentally transform government and governance in the 21st century. Complete and utter openness is the future of government.

Back to the Forum

Part III: Openness, implementation and governance

(This is the last of three parts of the interview. Read Part I on The future of eHealth here, and Part II on eHealth in an international perspective here.)

Talkstandards [TS]: openEHR is well known for its advocacy of open standards and specifications, what is the rationale behind this view?

David Ingram [DI]: Insecurities are more easily avoided and safety is promoted by allowing users to “open the hood” of a specification.

This conjecture is based on my own experience, coming from physics and moving into medical services and being close to the implementation of health IT, as I have often witnessed a discrepancy in how users think a system will work and how it actually functions. When people can view the specifications beforehand they are more prepared on what they get. This helps implementation. Keeping an open process also helps making specifications better.

The issue of IPR is complex but I believe that open source is important in academic areas, it helps sharing and handling of information and contributes to a stronger development process. I also believe that there is an issue with patenting something that everyone uses; it would be like Pythagoras patenting his theorem. Open source specifications provide a body of knowledge that can serve as public education.

TS: The three usual activities of openEHR are said to be “…implementation, implementation, implementation”. How far has Europe come in implementing eHealth technologies? And what are the main barriers for further deployment?

DI: I believe that implementation is important because it offers a learning-by-doing approach to answering questions. There is much implementation in the process and healthcare is getting constantly better. Implementation of eHealth technology provides valuable knowledge and ensures that new solutions are built on a solid foundation and thus serves as a promoter of innovation.

The healthcare sector is traditionally conservative, putting much effort in maintaining ethical responsibilities, which to some extent could inhibit innovation. Although changes are coming fast, systems are evolving and we are constantly learning there is still a long way to go in developing eHealth solutions. We need to find a balance between innovation and professional assurance and I am optimistic about the direction developments are taking.

I do wish, however, that governments would prioritize moving further toward learning about the scope of the challenges we are facing and experiment with different solutions. More transparency need to be brought to the teamwork between organizations, governments, clinical practitioners etc, and openness in that collaboration is critical; this is also what we learned from the early NHS projects that brought into healthcare people with valuable knowledge.

TS: You have expressed a need to restructure the organization of openEHR and work to better meet the growing interest from different regions and sectors. Can you comment on this?

DI: I have stated that openEHR needs a new form of governance, mainly as recognition of the fact that the organization has grown to include many different stakeholders. The goal is to make barriers to adoption of our specifications as small as possible and provide a better public understanding of the practical details of the organization. openEHR has from the start been very flexible in the innovation of specifications, but providing a commercial interface as an open source environment for adoption has taken a bit longer.

We recognize that the currently small executive group brings agility and flexibility but it can also stand in contrast to the image of a truly democratic organization. Bringing openEHR to where we are today has taken time and resources we simply cannot continue to spend. We are actively seeking partnerships with other organizations of which the most predominant are those with IHTSDO and EuroRec. This sort of partnerships will offer us a chance to follow other examples of basic principles and practical approach, but also to bring governance forward and handle the growing size of openEHR.

Oliver Bell (Reforming the Reformist Agenda) highlighted the benefits associated with a range of diversified SSOs. His claim is that today’s SSOs exist in an ecosystem formed by a dynamic market and the diversity we see, offers the prerequisite flexibility, competition and choice, for this market. No standard produced by an SSO or standards setting process, can be said to be “better” than that of another SSO or even guaranteed to hold “some level of immediate intrinsic value”. Therefore, when speaking of reforming SSOs, the focus should not be on simplifying the industry as a whole and hence decreasing the broad array of processes available today; but rather the inclusion of a “broader array of voices collaborating” to evolve the processes we have today towards meet the needs we know industry will have in the future. He concludes that although the vast diversity present in the ICT standards setting process can lead to a fair amount of confusion and frustration; the current system of diversified SSOs provides a solid platform to build upon.

Anne Layne-Farrar discussed the implications that arise from government intervention into SSOs’ governance models (Greasing the Gears or Gumming Them Up? The Government’s Role in Standard Setting Governance). Layne-Farrar points to the dangers of imposing a cap on licensing fees imposed by patent holders for intellectual property deemed essential to the standard. Specifically, she covers a model of limiting the maximum rate to that of the incremental value contributed by the IPR. She suggests that an imposition such as this would seriously decrease the economic incentives of innovation and fails to address the difficulty inherent in determining this incremental value. Furthermore, a trade off is to be made between the degree of openness and consensus and the speed of the standard setting process. Any government mandated rule would simply provide a one-size-fits-all solution which would ignore the diversity seen among SSOs today.

Ajit Jaokar (The Open Web Foundation and the Evolution of Web SSO?) shared his experiences from the Open Web Foundation. He expresses his belief that the OWF fills a gap in the SSO market as it essentially functions as a community-driven incubator of standards and because of its democratic ethos. Also, the OWF offers flexibility and openness, brings together formal and informal standards and addresses issues of future development. Thus, Ajit finishes by raising the question: Is the path chosen by the OWF a shape of things to come?

In an exclusive interview, Per Andersen, Managing Director of IDC Nordic and Benelux discussed the difficulties of setting criteria for openness in order to compare SSOs, since no unambiguous result can be found due to the loosely defined meaning of “openness”. This, he said, led to his study rather comparing “nuances of openness” in all aspects, from IPR policies to meeting documentation. Further, Andersen described the public sector interest in open standards as political strategy, and pointed out that such governmental involvement is rarely successful, especially not when rules are imposed in areas where market dynamics are much better instruments for achieving their goals.

In a second interview, Peter Brown, OASIS Board Chairman, gave valuable insights into the governance of OASIS. The market success of OASIS, he said, has been the result of confidence, which in turn has been achieved through OASIS’s transparency policies covering the entire standards setting process. This high level of confidence has been critical due to OASIS’s active involvement in areas such as eID and eHealth, where personal integrity is vital. Brown also discussed his belief that OASIS would not respond to any governmental attempts to influence the governance of the organization, although he has not yet seen any such attempts manifested. In conclusion, he welcomed the debate on SSO transparency. While he believes that many bodies are reluctant to open up because they are reliant on monetizing on standards, OASIS will remain vigilant and continue to push for the development and implementation of open standards.

Peter Brown gives a valuable insight into the governance of OASIS and some of the rationale behind it. Also, Peter Brown offers his general view of governance issues such openness, governmental interference and much more.

Interview for Talkstandards.com with Peter Brown, Chairman of the OASIS Board

Talkstandards [TS]: OASIS is well known for its transparency; what is the underlying rationale for this type of governance?

Peter Brown [PB]: Its origin is in the open source movement – the belief that by opening up a process to a community, you can “crowd source” and achieve better results. But it is also a powerful business model – by providing a transparent platform in which standards can be developed and an up-front choice of IP models with which our members are comfortable.

TS: Is transparency considered more important in some stages of the process than others?

PB: No, we believe that openness is important throughout the whole process

TS: In your view, how can SSOs’ governance contribute to the competition between organizations?

PB: Organizations, whether public sector agencies, government departments, NGOs or private companies, are increasingly looking at governance models and processes as an important consideration for their participation. I think that we are moving from a “defensive”, “insurance policy” approach to participation in standards organizations, based on the idea that you need to be there in order to ensure that your ideas are not locked out; to a more positive, value-driven approach based on recognizing the inherent value of standards in driving – not inhibiting – market competition and innovation.

TS: Further, how has OASIS’s governance of the standardization process affected the market success of developed standards?

PB: Increased confidence in the market, and the output that comes through, are the result of this openness and the implicit offer to any standard “consumer” to take a look at how it was put together. This is in stark contrast to the more closed processes in which the consumer is presented with output from an opaque sausage machine with dubious ingredients and processes.

TS: Many OASIS standards are used in areas where privacy and trust are of utmost importance (e.g. eHealth and eID); to what extent has the level of legitimacy of the standardization process contributed to the commercial success of OASIS standards?

PB: The identity management domain is, by its nature, very cautious and suspicious of opaque systems in which it is difficult to identify the motives, interests and offers of the various players. High levels of confidence are a pre-requisite to positive cooperation between partners and it is clear to me that the offer of a stable, transparent and sustainable process and environment has been a key factor in the choice of OASIS as the place to do this work.

TS: You have expressed that your view of OASIS is more of a service provider, supplying a platform where standards can be efficiently developed, than strictly as an organization. Does this affect the level of maintenance of published standards? How does OASIS react and evolve to meet changes in market demand or take heed to user feedback?

PB: It is an essential part of our process to recognize that the publication of a standard is not the end of the story. The service we provide to our members allows the story to evolve – whether it be the maintenance or updates of a standard, spin-offs, detailed implementation guidelines, or other work products, the community of members around any standard provides further value to those affected by or using any given standard.

TS: Many EU governments, supported by EC directives, are pushing for the implementation of eGovernment solutions which implies that governmental interest in OASIS standards is rising. Has this manifested in any attempts to affect the standardization process in terms of transparency and maintenance?

PB: No. We are proud of our process and hold it up as an example for others to follow. On the other hand, there are vested interests that are not always keen on such transparency and prefer to work through more opaque channels to defend particular interests. It has generally been a driving principle of eGovernment to favor openness and OASIS has certainly benefited from that.

TS: In case of such developments in the future, how would OASIS respond to such interference and what do you consider to be legitimate requirements for government intervention in the standardization process?

PB: We remain vigilant. In the current debate on the future of the European standardization system, we have seen that some bodies feel threatened by such openness, sometimes because a core part of their business models rely on monetizing their standards – make them open, and they lose money. Historically, this has been the elephant in the room and it is encouraging to see that it is being addressed.

OASIS Short info: OASIS (Organization for the Advancement of Structured Information Standards) is a not-for-profit consortium that drives development, convergence and adoption of open standards on a global scale. Since its founding in 1993, OASIS has gained more than 5,000 participants from over 600 organizations and become the largest producer of Web services standards. Transparency characterizes the governance and procedures of OASIS, with members setting the technical agenda and striving for openness throughout the process. Technical categories in which OASIS is active include: Web services, eCommerce, Security and XML processing.

Peter Brown Biography: Peter is founder and Managing Director of Pensive, a software solutions company for subject-centred computing, based in Belgium. He is also President and Chairman of the Board of OASIS, the global consortium that is advancing open standards for the Information Society.

Peter has more than 25-years experience working in European public institutions. He is currently on unpaid leave from the European Parliament where he previously headed the service responsible for information architecture and data standards. He has been heavily involved in standards work within the European Union institutions; at a European level through the European standards agency, CEN; and globally in OASIS and ISO. He was a co-editor of the “Reference Model for Service Oriented Architecture (SOA)”, now an OASIS Standard. He has been active in promoting the ISO 13250 standard (“Topic Maps”) as a standard for facilitating information federation and delivering practical semantic technology solutions today.

Peter is a regular keynote speaker and contributor to conferences throughout Europe and North America. His main professional interests are interaction design, subject-centric computing, semantics and “making the Information Society a safe place to be in”, through greater attention to data protection, privacy and users’ control over their digital assets.

Defining ‘Open’ is one thing, Defining ‘Open Business models’ is more complex and sometimes contradictory. So, the challenge is to think of Open business models on the basis of the ‘Open memo’. Let’s consider the example of Vinton Cerf referenced in the memo who defined the TCP/IP protocols that are the foundation of the Internet. TCP/IP is a textbook case of Network effects. However, note that in this case, there was a complete separation of the network effect and it’s business model. In contrast, there is a subtle but important difference when an organization creates a network effect through the Open philosophy (which Google has done), but at the same time seeks to ‘harness’ the benefits from that network effect (which is different from TCP/IP approach). The above point is the main reason for the contradictions that we see in the memo which others have also pointed out.

Gartner has a very interesting take on this in a blog called the Truth of Open in response to the memo. Gartner says:

Openness is by and large a strategy to reduce operating costs and remove supply chain dependencies. Open is not a revenue engine in its own right. In that regard, Rosenberg’s observation about sustaining competitive advantage through closed system are still valid. The only real change is that organizations are increasingly understanding how to balance both closed and open systems.

The truth is that closed systems still win. Open systems, practically speaking, are basically good for making others lose. The art of business in the 21st century is figuring out how to open up your suppliers’ and competitors’ business while keeping yours tightly sealed. And in that endeavour Google has proven highly successful.

In my view, the crux of creating a business model based on the Open philosophy lies in maintaining a leverage of control or in creating a barrier to entry. So, how many ways can we create a business model based on ‘Open’? Here is my list. Happy if you can suggest more.

a) Open source governance models: I have said this before Open is the new closed? – Bringing transparency to Open source by separating Open source licensing models i.e. Open source governance models are quite different from Open source development models and governance models are often ‘closed’.

b) Making others lose: As the Gartner link refers above, Open systems are a competitive strategy to reduce costs. In an extreme case, that involves making costs equal to zero. Better still if someone else is charging money for the same (software) product (Note that the model cannot work with hardware i.e. the incremental production costs of software are zero. Which helps leverage the model)

c) Abstraction: This is the classic business model for network effects i.e. create the value at a higher level of abstraction (in this case advertising). However, note that this model has two parts: First you must create the network effect and more importantly, you must then maintain a leverage of control. In this case, the leverage of control is through the search algorithms so as to lead the Google dance and make your partners follow. It is interesting that the memo says that the search algorithm is closed because it could be ‘gamed’, which is a direct contradiction on the Open (source) philosophy i.e. Linus’s law “given enough eyeballs, all bugs are shallow.”

d) Contradictions: Often you have to live with contradictions if you want a business model for Open. For instance, I would have loved the ability to tweet from Google reader. But I don’t think that this feature is forthcoming since Google and Twitter are competitors … unless Google acquires Twitter…

e) Scale: can be a competitive advantage. The Internet was supposed to ‘get rid of the middleman’, in reality, after the dust of the last decade has settled, there are only one or two massive intermediaries in each sector (Google/Amazon/Ebay etc)

f) Speed of execution for users (not customers): Like scale, speed of execution also offers a competitive advantage especially if the products are accepted by customers. In many ways, acceptance by the customer is the real evidence of success as the memo also implies i.e. the ability to create products that are accepted by the customer. However, there is a caveat here; in reality, we have ‘users’ and not ‘customers’ since most people do not pay for the services. Since the service is free, it creates users and not customers leading to greater speed of execution and a platform that helps to reinforce other products creating a competitive advantage

g) Metadata: Metadata (and not data) is the real driver to the business model. Thus, there is a lot of data flowing through in street view, scanned books, maps and mobile but it is the metadata (derived from the data) which is the foundation of the business model.

So, that’s all I could think of.

Last week, I visited India and my tech-savvy six year old was on Google maps showing his grandparents his ‘route to school’ on Google maps. He is very familiar with Google maps and can navigate it far better than I can. This indicates that: In the end, customers will neither know nor care about most of the above if they like the product/service.

This is both good and bad; the privacy implications of Cloud, Metadata etc are only now being realised. Altruism aside, it will be interesting to see how Open systems business models evolve from Open systems themselves. Comments welcome!

The Commission argues that EU needs to take action to avoid being marginalized in the ICT standardization process at the global level. This would be particularly problematic for Europe as ICT has become a predominant European industry; in 2007 it had a turnover of € 670 billion and accounted for over 5 percent of total employment. In addition, the landscape for standardizations has changed dramatically over the last decade – adding to the need of reform.

The Commission suggests that the current system should be updated in several areas, mainly to allow for a more integrated approach in ICT standardization and to strengthen competitiveness and fair competition – as well as collaboration and cooperation – in development and implementation of ICT standards (see e.g. the Commission´s Press release).

In order to assure the use of the best available standards the Commission suggests that the following should be reflected in the development process and the standards themselves:
• openness during the development of new standards;
• transparency in the technical discussion
• public availability (for a reasonable fee).

The white paper argues for possible synergies between ICT research, innovation and standardization. Currently, many ICT R&D projects produce highly relevant results but unfortunately these are often insufficiently translated into concrete applications. The Commission suggests that a more frequent consultation of standardization and research stakeholders to assure that all relevant R&D is implemented in actual production and, ultimately, consumed goods and services.

Interoperability in ICT has become critical as industries and countries grow ever more globally interconnected, as a result the treatment of intellectual property rights (IPR) is especially delicate in this field. Intellectual property (IP) needs to be properly protected; meanwhile standards should not lead to a restriction in competition. Therefore, the Commission suggests a flexible system for compensation to be used by standards developing organizations.  This system should ensure the effectiveness of procedures for IPR disclosures but is not to inhibit competition among different business models. The suggested system could also provide transparency and predictability by declaring restrictive licensing terms and royalty rates before the adoption of a standard.

The Commission further suggests that standards from fora and consortia can be recognized alongside European Standardization Organizations (ESOs). It is explicitly recognized that in some domains the expertise lies with fora and consortia and not with ESOs. Closer co-operation would produce standards more effectively and facilitate interaction with major trading partners.

The white paper marks the start of a thorough process of updating Council Decision 85/97/EEC.  The Commission´s proposal is based on the fundamental idea that ICT standards should be developed in co-operation between all involved parties. This principle could prove to be of particular importance for the European ICT industry´s global competitiveness in the future.

Initial reactions to the Commission’s proposal have been positive. OpenForum Europe writes in a press release: “Regarding the recommendations in detail, OFE strongly supports the proposed modernization of European standardization policy”. Other approving opinions can be heard in various blogs, Jochen Friedrich for example writes: “This white paper responds to urgent needs of many stakeholders [and] deserves strong support”.

The Commission invites public consultation on its proposal by September 15 (http://ec.europa.eu/yourvoice/consultations/index_en.htm#open). Time will tell if the public response will remain positive.

Looking at the ten organizations researched there are differences in the number of requirements in which they score positive. It is difficult to see any clear patterns in the ratings though. We believe there are a number of reasons for this. Standard organizations are generally aware of the need of openness because they all aim at providing successful, widely accepted standards. However, the concepts of openness and consensus have been implemented using different models that relate to the type of organization, their formal foundation and their degrees of formalization. We therefore see the apparent differences in openness as a sign of the structure chosen by the organizations.

In conclusion there are, indeed, differences between standard setting organizations in terms of “openness” and certainly in terms of how “openness” is implemented. It can be, however, difficult to make a distinction of which form of “openness” is the most appropriate.

Executive summary of “Evaluation of Ten Standard Setting Organizations with Regard to Open Standards” (92 page PDF version available here) posted with permission given by Per Andersen, Managing Director, IDC Nordic & Benelux.