Competitiveness, compatibility, computers, and the community

The aim of this study is to explain the process of product standardization in the European Community information technology industry and how it is linked to competitiveness. The focus is how firms influence standards to improve their standing in their global marketplace. This study will analyze (1) their quest to become more internationally competitive, and (2) the role compatibility standards plays in that objective. From many strategies to set product design standards, this study will focus on three: licensing technology, complementary products, and technological leapfrog. The recent activities of two large European firms to improve their competitiveness will be described. An analysis of the motivation for strategic alliances and their relationship to technological standard-setting will be given. These two case studies will reveal some relevant strategic lessons. The conclusions will attempt to make some suggestions on how the European information technology firms can become more competitive through standardization strategies.