technologies and to permit their incorporation into standards. As previously noted, some firms gain substantial benefits from owning the rights to a proprietary technology that becomes a de facto industry standard. Prohibitively high payments to the owner of technology in a given standard, however, will deter its spread and motivate other parties to develop an alternative standard.27 In most consensus standards organizations, owners of intellectual property incorporated into a formal standard agree to license proprietary technology at reasonable terms.28

Voluntary Consensus Standardization Processes

In comparison to most foreign systems, the institutional structure of the U.S. voluntary consensus standards system is highly decentralized. The United States has more than 400 private standards developers. Most are organized around a given industry, profession, or academic discipline. About 275 engage in ongoing standards-setting activities. The remainder have developed standards in the past—usually few in number—and occasionally update them.29 There are three main types of U.S. standards-developing organizations: professional and technical societies, industry associations, and standards-developing membership organizations, discussed later in this chapter.30

All standards-developing organizations, to varying degrees, seek to overcome economic obstacles to standardization. The typical method for achieving this goal is to coordinate participation of volunteer technical experts in standards-writing committees. Each technical committee is responsible for standards in a particular area of product, process, or technology, although overlap does sometimes exist among different committees' scope of work. Committee membership is generally selected to represent a diversity of interests and viewpoints. Committees—or, in some cases, working groups that are subsets of a committee—meet on a semiregular basis over a period ranging from weeks to years. The first step in developing a standard is to identify an area of marketplace need requiring a standardized technical solution. Once a scope of work is set, draft technical standards are proposed, discussed, revised, and voted on. Consensus is, in most organizations, a key goal. Although negative votes do not prevent a standard's adoption, they must generally be considered and responded to in writing.31

Participants in a technical committee may propose, as foundations for a standard, technologies developed by their respective firms. Success in this effort may yield a marketing advantage or a technological head start over other companies whose technologies are not chosen. Alternatively, the committee may develop a compromise standard incorporating aspects of multiple proposals.32

After review, comment, and approval by the SDO's oversight board and membership at large, the organization publishes the standard. If the organization uses ANSI-accredited procedures, it may choose to have the standard approved and distributed by ANSI as an American National Standard. ANSI does not

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