Investigating Knowledge Spillovers under Standardization in the Mobile Telecommunication Industry

Abstract

This article is to draw strategic implications for firms by elucidating the causes of knowledge spillovers in the standardization of the mobile telecommunication industry. It has been commonly recognized that leading firms can expand the market for their advanced products by attending standardization activities. On the contrary, several recent debates have started to argue that firms' standardization activities do not guarantee these firms' successes of products in the marketplace. By examining the flow of knowledge in the standardization of mobile telecommunications industry, this study shows that technological information of technology specifications and essential patents, which are set and declared by leading firms (i.e. Nokia and Ericsson, etc.), help new entrants (i.e. Qualcomm, Samsung, etc.) acquire relevant technological knowledge and thereby declare essential patents and apply for appropriate patents. The analysis suggests that leading firms should conduct multi-faceted knowledge management to prevent such unexpected knowledge spillovers by their standardization activities.