An Empirical Study of the Effects of Ex Ante Licensing 

Disclosure Policies on the Development of Voluntary Technical 

Standards 

by 

Jorge L. Contreras 

American University 

Washington College of Law 

Washington, DC 

for 

NISI 

National Institute of 

Standards and Technology 

U.S. Department of Commerce 

NIST Standards Services Group 

Under NIST Contract No. SB134110SEI033 

This publication was produced as part of contract SB134110SEI033 

with the National Institute of Standards and Technology. The contents of this 

publication do not necessarily reflect the views or policies of the National 

Institute of Standards and Technology or the U.S. Government. 

GCR 11-934 

Release Date: June 27, 2011 
An Empirical Study of the Effects of Ex Ante Licensing Disclosure 

Policies on the Development of Voluntary Technical Standards 

Jorge L. Contreras 

Table of Contents 

Acknowledgements and Statement of Interests 

I. Executive Summary 

II. Background 

A. Development of Voluntary Technical Standards 

B. Patent Hold-Up in Standards-Setting 

C. SDO Patent Policies 

D. FRAND Licensing Requirements 

E. Ex Ante Disclosure of Licensing Terms as a Proposed Solution 

F. Criticisms of Ex Ante Policy Policies 

G. SDO Adoption and Consideration of Ex Ante Policies 

1. VITA 

2. IEEE 

3. ETSJ 

4. Consortia (W3C and NGMN) 

5. JETF and "Informal" Ex Ante Approaches 

III. Study Aims and Methodology 

A. Study Aims 

B. Methodology 

1. SDOs Selected 

2. Time Period 

3. Historical Data 

4. Survey Data 

IV. Findings and Analysis 

A. SDO Patent and Licensing Disclosures 

B. Number of Standards 

C. Length of Standardization Process 

D. Personal Time Commitment 

E. Membership 

F. Quality of Standards 

G. Effect on Royalty Rates 

V. . Conclusions 

Data Appendices 

List of References 

Ex Ante Standards Study Report 

June 27,2011 

Page i 
Acknowledgements 

This study was funded by the u.s. National Institute of Standards and Technology 

(NIST) under Contract No. SBI34110SEI033. The author gratefully acknowledges the 

guidance and support ofNIST staff. 

This study could not have been completed without the able assistance of Dr. Melody 

Goodman (statistical analysis) and Yen-Shyang Tseng (research assistance) at 

Washington University in St. Louis. 

Many thanks are also due to Ray Alderman and John Rynearson of VITA and David 

Ringle of IEEE, who provided invaluable information and insight relating to their 

organizations. 

The author also thanks the following for their valuable comments, suggestions and 

insights: James Gibson, Kimberly Kaphingst, John Kulick, Michael Lindsay, Steve Mills, 

Gil Ohana, Scott Peterson, Robert Skitol, Tim Simcoe, Claudia Tapia Garcia, and the 

participants in the 2011 Arizona State University Conference on Technology Standards in 

a Globalized World and the Federal Trade Commission's 2011 Workshop on Intellectual 

Property Rights in Standard Setting: Tools to Prevent Patent Hold-Up. 

Statement ofInterests 

The author serves a legal consultant to the Internet Engineering Task Force (IETF), one 

of the organizations discussed in this report. No consideration was received from IETF 

in connection with this report or study. 

Ex Ante Standards Study Report 

June 27,2011 

Page ii 
I, Executive Summary 

The threat of patent "hold-up", in which patent holders demand compensation 

from implementers of technical standards following wide-scale adoption of those 

standards, has focused significant governmental, academic and industry attention on 

means for averting such scenarios. One method of addressing patent hold-up risk is the 

imposition of an obligation on patent holders participating in the standardization process 

to license their standards-essential patents to implementers on "fair, reasonable and 

nondiscriminatory" (FRANO) tenns. The precise meaning of FRANO commitments, 

however, have proven difficult to detennine with precision, leading to further litigation 

and uncertainty. An alternative approach proposes that each patent holder participating 

in a standards-development organization (SOO) to disclose in advance ("ex ante") the 

material tenns on which it will license its standards-essential patents. The risks and 

merits of such ex ante licensing disclosure policies have been debated extensively. In 

2006-07 the U.S. Department of Justice approved limited ex ante licensing disclosure 

policies adopted by two U.S.-based voluntary SOOs, VMEBus International Trade 

Association (VITA) and the Institute for Electrical and Electronics Engineers (IEEE). At 

the time these policies were adopted, critics predicted that early disclosure of patent 

licensing tenns could lead to anticompetitive conduct by standards implementers and 

would unduly burden the already lengthy and costly standards development process. 

This study represents the first empirical investigation of the effects of ex ante 

licensing disclosure policies on standards development. We examined data relating to 

SOO membership, standards projects initiated, standards approved, speed of the 

standardization process, individual time commitment and quality of standards for VITA, 

IEEE and the Internet Engineering Task Force (IETF) from 2003/4 to 2010. We also 

conducted a survey of VITA participants to assess individual reactions to the adoption of 

the VITA ex ante policy in 2007. 

In general, we did not find that ex ante disclosure policies resulted in measurable 

negative effects on the number of standards started or adopted, personal time 

commitments or quality of standards, nor was there compel1ing evidence that ex ante 

policies caused the lengthening of time required for standardization or the depression of 

royalty rates. There was some evidence to suggest that the adoption of ex ante policies 

may have contributed positively to some of these variables. Moreover, a significant 

majority of VITA participants responding to our survey felt that the infonnation elicited 

by the organization'S ex ante policy was important and improved the overall openness 

and transparency of the standards-development process. Thus, while there are numerous 

areas in which further study and analysis may be warranted, and other organizations in 

which the implementation of ex ante policies may have different effects, we conclude, on 

the basis of the data that we have reviewed, that the process-based criticisms of ex ante 

policies and the predicted negative effects flowing from the adoption of such polices, are 

not supported by the evidence reviewed. 

Ex Ante Standards Study Report 

June 27,2011 

Page 1 
II. Background 

A. Development of Voluntary Technical Standards. Technical standards are detailed 

sets of instructions, specifications or protocols that must be complied with in order to 

achieve a particular technical purpose. Depending on the standard, this purpose may be 

to achieve a minimum level of safety (e.g., security of automobile seatbelts), a desired 

environmental effect (e.g., reduction of carbon emissions), or interoperability among 

products and technologies sold by different vendors (e.g., TCP/IP, USB, WiFi, GSM and 

other computing, networking and telecommunications standards). This last category of 

standards, those that are intended to promote technological interoperability and which are 

prevalent in the so-called information, communications and technology (ICT) sector, are 

generally voluntary, in that compliance is not mandated by any governmental or 

regulatory body. Rather, market participants elect to comply with voluntary 

interoperability standards to make their products and technologies competitive in a 

networked, interdependent marketplace. I 

Voluntary interoperability standards are developed within a variety of 

organizational structures including treaty organizations such as the International 

Organization for Standardization (ISO) and International Telecommunications Union 

(lTU), regional standards developing organizations such as the European 

Telecommunications Standards Institute (ETSI), professional and technical organizations 

such as the Institute of Electrical and Electronics Engineers (IEEE) and the VMEBus 

International Trade Association (VITA), and less formalized consortia such as the 

Internet Engineering Task Force (IETF) and Worldwide Web Consortium (W3C)2 In the 

United States, the American National Standards Institute (ANSI) acts both as the 

accreditation body for SDOs that wish to develop American National Standards,3 as well 

as the United States representative to ISO and other international bodies. 

B. Patent Hold-Up in Standards-Setting. SDOs typically hold no patent rights in the 

standards developed by their members. Rather, participants in the standards development 

process (whether companies or individuals) retain their ownership of standardized 

technology and may obtain patents that claim implementations of these standards' This 

ability to patent standardized technology is perceived to lead to a risk of patent "holdup", meaning that a participant in the standards develojJment process may guide a 

standard toward its own patent position, or may subsequently seek patent protection over 

I See, e.g. CARL SHAPIRO & HAL R. VARIAN, INFORMATION RULES: A STRATEGIC GUIDE TO THE NETWORK 

ECONOMY 245-48 (1999). 

2 A more detailed description of the multifaceted standards development "ecosystem" can be found in 

Intellectual Property Owners Association, Standards Primer - An Overview of the Standards Setting 

Bodies and Patent-Related Issues That Arise in the Context of Standards-Setting Activities (Sept. 2009) 

(available at 

http://www.ipo.org/AM/T emp late.cfm?Section~Patents&T emplate~/MembersOnl y .cfm&N avMenulD~ 145 

4&ContentID~24139&DirectListCombo Ind~D). 

3 There are currently approximately 220 ANSI-accredited SDOs. 

4 This study does not address copyrights in standards documents, an issue that has also proven contentious 

in'recent years. 

Ex Ante Standards Study Report 

June 27, 2011 

Page 2 
aspects of the standardized technology, and then seek to extract unanticipated royalty 

payments from other implementers of the standard after the standard is widely adopted or 

"locked-in,,5 The legal and economics literature frequently cite patent hold-up in the 

standards-setting context as having negative implications, both for individual market 

participants and the market as a whole6 

C. SDO Patent Policies. In order to avoid hold-up situations, and in response to 

several high profile instances of alleged patent hold-up in the standards-setting context,7 

many SDOs have implemented formal policies designed to alleviate the perceived risks 

of patent hold-up. These policies fall into two general categories: disclosure policies and 

licensing policies, and often include elements of both. Disclosure policies typically 

require participants in the standards development process to disclose patents they hold 

that would necessarily be infringed by an implementation of the standard (typically 

referred to as "essential" patents)8 Licensing policies typically require that participants 

grant implementers licenses under their essential patents on terms that are "reasonable 

and non-discriminatory" (RAND) or "fair, reasonable and non-discriminatory" 

(FRAND).9 

D. FRAND Licensing Requirements. As noted above, many SDO licensing policies 

require that patent holders grant licenses to implementers of their standards on FRAND 

terms. But despite the intuitive appeal of this designation, a consistent and practical 

definition of FRAND has proven notoriously difficult to define with precision. 1o In 

several recent cases parties have disputed whether the terms under which licenses have 

been offered violate or conform with FRAND requirements: 

Nokia v. Qualcomm (Del. Chancery 2007): Nokia alleged that Qua1comm failed 

to offer FRAND licensing terms in violation of its obligations to ETSI. 

5 See U.S. Federal Trade Commission, The Evolving IP Marketplace: Aligning Patent Notice and Remedies 

with Competition at 191 (2011) (hereinafter "FTC 2011 Report") and HAL R. VARIAN, JOSEPH FARRELL & 

CARL SHAPIRO, THE ECONOMICS Of INfORMATION TECHNOLOGY - AN INTRODUCTION 81 (2004). 

6 See, e.g., Mark A. Lemley, Ten Things to do About Potent Holdup of Standards (and One Not Ta), 48 

BOSTON COLL. L. REv. 149, 150-52 (2007), Mark Lemley & Carl Shapiro, Patent Holdup and Royalty 

Stacking, 85 TEX. L. REv. 1991 (2007), Robert A. Skitol, Concerted Buying Power: Its Potential For 

Addressing The Patent Holdup Problem in Standard Setting, 72 ANTITRUST L.J. 727, 729-30 (2005). 

7 See. e.g., In reo Dell Computer Corp., 121 F.T.C. 616 (1996), Rambus, Inc. v. lnjineon Technologies AG, 

318 FJd 1081 (Fed. Cir. 2003), cert. denied, 124 S.C!. 227 (2003). . 

8 See, generally, AMERICAN BAR ASSOCIATION, COMMITTEE ON TECHNICAL STANDARDIZATION, SECTION 

OF SCIENCE & TECHNOLOGY LAW, STANDARDS DEVELOPMENT PATENT POLICY MANUAL (Jorge L. 

Contreras, ed., 2007) (hereinafter "ABA MANUAL"). 

9 See, generally, ABA Manual, supra note 8, at 56-67. Commentators have been unable to agree on any 

substantive difference between RAND and FRAND commitments. Thus, for the sake of expediency, the 

term FRAND will be used throughout this paper. 

10 See, e.g., SHAPIRO & VARIAN, supra note 1, at 241, Andrew Updegrove, Ex Ante Disclosure: Risks, 

Rewards, Process and Alternatives, CONSORTIUM STANDARDS BuL., June 2006,1,4-5; Anne Layne-Farrar, 

A. Jorge Padilla & Richard Schmalensee, Pricing Patents for Licensing in Standard-Setting Organizations: 

Making Sense of FRAND Commitments, 74 ANTITRUST LJ. 671, 671'72 (2007); Marc Rysman & Tim 

Simcoe, A NAASTy Alternative to RAND Pricing Commitments at 2 (working paper 2011) (available at 

http://people.bu.eduitsimcoe/documents/publishedINAAST.pdf). 

Ex Ante Standards Study Report 

June 27, 2011 

Page 3 
Apple v. Nokia (D. Del. 2009): Apple argued that Nokia's royalty and grantback 

requirements violated ETSI and IEEE FRAND commitments. 

CUT FATT (FCC 2009): Digital television manufacturers petitioned U.S. Federal 

Communications Commission to rule that Funai's 5% royalty on a digital 

television patent violated the FCC's FRAND requirement for the ATSC standard. 

Zoran v. DTS (ND. Cal. 2009): Zoran sued DTS, a fellow member of the Blu-ray 

Disc Association, for alleged non-compliance with FRAND licensing obligations. 

Microsoft v. Motorola (W.D. Wash. 2010) Microsoft alleged that Motorola failed 

to comply with IEEE's FRAND requirements for licensing patents covering the 

WLAN and H.264 standards. 

These cases represent a recent and growing trend to dispute the meaning of 

"FRAND", particularly with regard to royalty levels, in the standards development 

context. 

FRAND licensing commitments can lead to disputes because there is no 

generally-accepted, objective standard by which "reasonableness" (or 

"nondiscrimination") can be measured. In order to make a FRAND determination, the 

specific facts of each situation must be evaluated. 11 These facts include not only relevant 

market norms for royalties, but also customary practices relating to non-royalty terms 

such as reciprocity, grantbacks, defensive suspension, confidentiality and the like. Also, 

given that a patent holder's FRAND licensing terms are often not revealed until 

negotiations occurring after a standard has been adopted (i.e., "locked-in"), parties 

involved in standards setting can experience uncertainty regarding the ultimate cost of 

adopting a standard encumbered by patents. Moreover, after lock-in of a standard, the 

patent holder's leverage in any negotiation increases enormously. 12 Put another way, 

FRAND licensing commitments may be said to do no more than substitute the risk of 

hold-up arising from unknown patents with hold-up arising from unknown licensing 

terms. 

E. Ex Ante Disclosure of Licensing Terms as a Proposed Solution. Several 

commentators have suggested that hold-up issues may be alleviated by requiring patent 

holders to disclose the royalty rates and material licensing terms on which they are 

willing to license essential patents prior to the approval of the standard (i.e., before the 

11 In this regard, commentators have pointed to the 15 Georgia-Pacific factors used in assessing 

"reasonable" royalty rates for patent damages calculations. See, e.g., Michele K. Herman, How the Deal is 

Done, Part 1, LANDSLIDE, Sept/Oct 2010, 35, 37 (citing Georgia-Pacific Corp. v. U.S. Plywood Corp., 318 

F. Supp 1116 (S.D.N.Y. 1970)). Nevertheless, the Georgia-Pacific factors themselves have been criticized 

as imprecise and indeterminate, and a full discussion of the calculation of patent damages is beyond the 

scope of this report. 

12 SHAPIRO & VARIAN, supra note 1, at 136-41. 

Ex Ante Standards Study Report 

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Page 4 
fact or "ex ante,,).13 According to this theory, such an ex ante licensing disclosure 

policyl4 would prevent patent holders from demanding unexpectedly high royalties 

(subject only to the ambiguous FRAND requirement) after a standard has been adopted 

and locked-in. Advance disclosure of royalty rates, it is argued, would enable SDO 

participants to evaluate the cost of including particular patented technologies in a 

standard prior to adoption, and would thus enable more efficient decision making with 

respect to the technical design of the standard. That is, if a patent holder disclosed a 

royalty rate that was exorbitant, or multiple patent holders disclosed royalty rates that, in 

the aggregate, could not be supported by projected profits from the sale of products 

implementing the standard, then standards-developers could theoretically adjust the 

design of the standard to avoid one or more of these patents and/or opt for an alternative 

technology covered by fewer or no such patents early in the process. IS 

F. Criticisms of Ex Ante Proposals. 

I. Legal Criticisms. Critics argue that ex ante policies will impede 

standards-setting processes and create additional legal risks for participants. The most 

commonly-asserted legal objections to ex ante policies center around antitrust concerns. 

For example, it has been suggested that ex ante licensing negotiations could facilitate the 

improper exchange of information among competitors (i.e., multiple competing patent 

13 Lemley, supra note 6, at 158-59, Gil Ohana, Marc Hansen & Omar Shah, Disclosure and Negotiation of 

Licensing Terms Prior to Adoption of Industry Standards: Preventing Another Patent Ambush? [2003J 

EUROPEAN COMPETITION L. REv. 644, 648-50 (2003), Skito1, supra note 6. at 741-42. 

14 In this report, the term "ex ante policy" is used to designate an SOO patent policy requiring or permitting 

disclosure of licensing terms for patents essential to implementation of a standard prior to approval of the 

final standard. This nomenclature can be confusing to the uninitiated, as a large number of SDO 

intellectual property policies require disclosure of patents essential to the implementation of a standard 

prior to approval, but do not require (or expressly permit) disclosure of licensing terms. Thus, while these 

policies technically require disclosure of something (patents) on an "ex ante" (before the fact) basis, they 

are not conventionally refened to as "ex ante" policies. 

Moreover, much of the economics literature in this area discusses ex ante licensing disclosure 

approaches coupled with joint negotiation of license terms. See Damien Geradin, Anne Layne-Farrar, & A. 

Jorge Padilla, The Ex Ante Auction Model for the Control of Market Power in Standard Setting 

Organizations (working paper, Apr. 2007) (available at SSRN: http://ssrn.coll1!abstract~979393) and Anne 

Layne-Fanar, Gerard LIobet & A. Jorge Padilla, Preventing Patent Hold up: An Economic Assessment of 

Ex Ante Licensing Negotiations in Standard Setting (working paper, May 2008) (available at SSRN: 

http://ssrn.comlabstract=1l29551). Such joint negotiation has been viewed by U.S. and European 

regulatory agencies as requiring a higher degree of scrutiny than mere ex ante licensing disclosure. See 

U.S. Dept. of Justice & U.S. Fed. Trade Comm., ANTITRUST ENFORCEMENT AND INTELLECTUAL PROPERTY 

RIGHTS: PROMOTING INNOVATION AND COMPETITION 53-56 (2007) (hereinafter "2007 DOJ/FTC RepOlt") 

and European Commission, GUIDELINES ON THE ApPLICABILITY OF ARTICLE 101 OF THE TREATY ON THE 

FUNCTIONING OF THE EUROPEAN UNION TO HORIZONTAL CO-OPERATION AGREEMENTS ~299 (2011) 

(hereinafter "EC Horizontal Guidelines"). None of the SDOs examined in this study permit joint 

negotiation of licensing terms. For this reason, this report focuses on ex ante disclosure of licensing terms, 

and does not address ex ante negotiations. 

15 See, e.g., Deborah Platt Majoras, Recognizing the Procompetitive Potential of Royalty Discussions in 

Standard Setting, Remarks prepared for "Standardization and the Law: Developing the Golden Mean for 

Global Trade", Stanford Law School, Sept. 23, 2005, at 8, U.S. Dept. of Justice, Business Review Letter to 

VMEbus International Trade Association (VITA) at 3 (Oct. 30, 2006) (hereinafter, "DO] VITA Letter"). 

Ex Ante Standards Study Report 

June 27,2011 

Page 5 
holders who would otherwise not be pennitted to share royalty infonnation with one 

another) and thus lead to collusion regarding royalty pricing. 16 On the implementer side, 

it is also claimed that requiring a patent holder to disclose its licensing tenns ex ante 

might place too much power in the collective hands of licensees. That is, potential 

implementers of a standard, in negotiating license tenns with a patent holder, could 

collectively exert anticompetitive pressure on the patent holder to reduce its royalties 

below their fair (or optimal) level. 17 Under this scenario, group pressure would tend to 

drive all royalty rates toward zero, resulting in the devaluation of patents covering the 

standard.'8 This type of improper buyer cartel or "oligopsony" is avoided when patent 

holders are pennitted to negotiate license tenns with implementers on a bilateral basis, 

constrained only by FRAND guidelines. These arguments do not assert that ex ante 

policies themselves violate antitrust laws, but that they are likely to encourage additional 

anti competitive behavior within the SDO context. Regulatory agencies in both the U. S. 

and Europe have not, by and large, expressed concern with SDO ex ante policies absent 

further anticompetitive behavior by participants.!9 A detailed analysis of the antitrust and 

other legal critiques of ex ante policies is beyond the scope of this study. 

2. Process Criticisms. Critics also contend that ex ante policies are both 

unnecessary and likely to be detrimental to the standards development process. Ex ante 

policies are unnecessary, they claim, because licenses to patents "essential" to the 

implementation of a standard are typically insufficient to meet implementers' commercial 

needs, and most implementers would prefer to negotiate broader, more inclusive license 

agreements with patent holders 2o They also argue that ex ante disclosure of patents, 

already required by many SDOs, is sufficient to warn standards developers of potential 

patent "roadblocks" and enable them to work around patented technologies if they so 

desire; and the additional disclosure of licensing tenns is unnecessary to achieve this 

purpose2 ! Finally, they contend that patent holders who participate in most SDOs are 

bound by commitments to license their essential patents on FRAND tenns and willingly 

disclose their royalty rates and other licensing tenns to potential implementers of a 

standard within the context of bilateral negotiations.22 

Critics go on to argue that the adoption of ex ante policies will have deleterious 

effects on the development of technical standards. One common contention in this vein 

is that the early disclosure of licensing terms will inappropriately focus standards 

developers' attention on patent licensing issues, making the overall standards 

development process more cumbersome, lengthy and expensive and distracting SDOs 

16 See 2007 DOJ/FTC Report, supra note 14, at 42-48. 

17 This type of anticornpetitive buyer cartel is termed an ;"oligopsony". See 2007 DOl/FTC Report, supra 

note 14, Skitol, supra note 6, at 735, Herman, supra note 11, at 38. 

lS Some commentators argue that royalty-free licensing is the most appropriate solution for interoperability 

standards. See, e.g., Herman, supra note 11, at 37-38, Updegrove, supra note 10, at 11-12. An assessment 

of this argument, however, is beyond the scope of this paper. 

19 2007 DOJ/FTC Report, supra note 14, at 53-55, EC Horizontal Guidelines, supra note 14, at ~299. 

20 Herman, supra note 11, at 38 (arguing that implementers "generally do not want a license only to 

essential claims, but rather to all afthe patent claims that their commercial implementations infringe ... "). 

21 ld. at 39. 

221d. 

Ex Ante Standards Study Report 

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Page 6 
from the important work of standards development. Thus, while proponents of ex ante 

policies claim that such policies will reduce delays in the standardization process caused 

by the threat of patent hold-up, critics of ex ante policies argue that such policies will 

lengthen the standardization process and, consequently, reduce the number of valuable 

standards produced.23 Critics also predict that the adoption of ex ante policies by SDOs 

will drive members away from these SDOs, either because members are unwilling to 

incur the additional costs imposed by such policies (i.e., increased legal support to 

evaluate and address licensing disclosures), because they feel that standards can be 

developed more efficiently elsewhere, or simply because they do not wish to comply with 

the early disclosure requirements of such policies.24 In each of these cases, an SDO's loss 

of members would both weaken the SDO financially (due to loss of membership dues) 

and detract from the expertise that withdrawing participants could have contributed to the 

standardization process. On a related note, some have argued that ex ante policies may 

lead standards developers to settle for SUb-optimal technologies in order to avoid the 

payment of royalties on patented, but superior, technologies25 In each of these cases, 

critics argue that an SDO's adoption of an ex ante policy is likely to weaken the technical 

output of the SDO and thus its value to members and to the economy as a whole26 

Accordingly, it is the goal of this study to collect and analyze relevant empirical data that 

elucidates the correlation, if any, between the adoption of SDO ex ante policies and these 

predicted effects. 

23 See Richard S. Taffet, Ex Ante Licensing in Standards Development - Myths and Reality at 15 (presented 

to AIPLA Spring Meeting, May 4, 2006) (available at 

http://www.binglmm.comlMedia.aspx?MediaID=2742) ("[s]peed is of the essence in the development of 

technical standards ... [i][ it becomes necessary to evaluate the competitive effects of joint "ex ante" 

conduct, however, the ability to conclude the teclmical development of a standard could be tremendously 

inhibited"), Hennan, supra note 11, at 39 ("collective consideration of patent licensing issues may 

unacceptably delay the standards development process"), 2007 DOJ/FTC Report, supra note 14, at 50, 

Skitol, supra note 6, at 734. 

24 See Michael A. Lindsay, Negotiating Royalty or Other License Terms Before the Standard is Set at 7 

(presented at Am. Intell. Prop. L. Assn. 2009 Spring Meeting) (available at 

http://www.dorsey.comlfiles/upload/lindsay _ negotiatingJoyalties _ AIPLA _ spnng09. pdt), Herman, supra 

note 11, at 38; CLAUDIA TAPIA, INDUSTRIAL PROPERTY RIGHTS, TECHNICAL STANDARDS AND LICENSING 

PRACTICES (FRAN D) IN THE TELECOMMUNICATIONS INDUSTRY 170 (2010), 2007 DOJ/FTC Report, supra 

note 14, at 50 (citing concems of various panelists), Letter from Michele Herman, Davis Wright Tremaine 

LLP to Patrick Gallagber, National Institute of Standards and Technology, March 4, 201 I at 8 (available at 

http://standards.gov/standards gov/sos rfi docs/26 Herman DWTLLP.pdj) (hereinafter "DWT NIST RFP 

Response") . 

25 See Taffet, supra note 23, at 15; TAPIA, supra note 24, at 178; DWT NIST RFP Response, supra note 24, 

at 8 (patent-holding innovators who leave an SDO due to the "hostile and costly" environment caused by its 

ex ante policy may "have the most to offer and contribute to the standards setting process", thus impacting 

the quality of standards developed in the SDO). 

26 See Michele Hennan, The Quandary of a Balanced ]PR Policy, LICENSING J., Oct. 2006, at 5, 7-8 

(combining these three critiques: "[w]ithout the participation of such key contributors, who may possess 

key blocking IP applying to a standard, the resulting standard may take much longer to develop and be 

technically inferior"). 

Ex Ante Standards Study Report 

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Page 7 
G. SDO Adoption and Consideration of Ex Ante Policies 

Beginning aronnd 2005, a nnmber of SDOs in tbe U.S. and Europe began to 

consider the adoption of ex ante policies in one fonn or another.27 Below is a brief 

summary of several of these efforts. 

1. VITA. The VMEBus International Trade Association (VITA), based in 

Scottsdale, Arizona, was incorporated in 1984 as a manufacturers' forum and support 

organization for the open VMEBus standard originally released by Motorola, Mostek, 

Signetics/Philips and Thomson CSF in 1981 28 From 1981 to 1992, VITA continued to 

refine the VMEBus standard both independently and through participation in the IEEE 

P1014 Working Group. In 1992 VITA discontinued participation in the IEEE PI014 

working group and fonned the VITA Standards Organization (VSO), an independent 

organization within VITA, to evolve the VMEBus standard and develop additional 

standards of interest to its membership29 Shortly after its fonnation, VS030 was 

accredited by ANSI as an American National Standards developer and by the 

International Electrotechnical Commission (1EC) as a submitter of Industry Technical 

Agreements3

! VITA standards today are used primarily in embedded computing systems 

designed for demanding envirornnents including military, avionics, industrial and 

communications applications. 

In the mid-1990s, VITA experienced two situations in which, late in the 

standards-development process, members disclosed patents deemed to be essential to the 

implementation of a VITA draft standard, and then demanded royalties that were 

"significantly higher than expected,,32 In each case, VITA engaged outside counsel to 

identify prior art potentially invalidating the disclosed patents and eventually succeeded 

in obtaining covenants from the patent holders not to assert such patents against 

implementers of VITA standards. In another instance, a VITA standard "was rendered 

commercially infeasible by the licensing tenns demanded by the patent owner.,,33 

In response to these incidents, after a series of internal deliberations, in 2006 

VITA developed a draft ex ante policy. This policy requires that working group members 

holding patents "essential" to the implementation of a VITA standard disclose not only 

the existence of such patents, but also maximum applicable royalty rates and certain other 

'27 See Updegrove, supra note 10, at 1-4 (describing events leading to the discussion of such poiicies). 

'28 See VITA News Release, VITA and the VME Technology Community Celebrate 25th Anniversary, Oct. 

23,2006 (available at 

http://www.vita.cominewsIVITA%20and%20VME%20Technology%20Community%20Celebrate%202Sth 

%20Anniversary%20 10-2006.pdf). 

29 See id. and VSO Policies and Procedures, Rev. 2.6 - Nov. 30, 2009, at 3 (available at 

http://www.vita.comivso-pp-r2d6.pdf). 

30 For purposes of clarity, throughout this report the term VITA will be used to refer both to VITA and 

VSO unless specific reference to VSO is required by the context. 

31 VITA Standards Organization (available at http://www.vita.comlvso-stds.html) (last visited May 29, 

2011). 

32 DOJ VITA Letter, supra note IS, at 3 (citing Letter from Robert A. Skitol to Thomas O. Barnett, 

Assistant Atty. Gen., U.S. Dept. of Justice 2 (June IS, 2006) (hereinafter "Skitol Letter"). 

33 Id. at 3-4 (citing Skitol Letter). 

Ex Ante Standards Study Report 

June 27, 2011 

Page 8 
licensing restrictions. 34 A failnre to disclose these tenns will result in such patents being 

licensed to implementers of the standard on a royalty-free basis. Disclosures may be 

revised, but only if the revised disclosnre are "less restrictive" than the ones they are 

intended to supersede. Patent holders are also be pennitted, but not required, to 

accompany their disclosnre with a sample license agreement. Recognizing the potential 

for antitrust liability arising from joint negotiation of licensing tenns, the proposed policy 

expressly prohibits group licensing negotiations within the context of VITA. 

In June 2006, VITA requested a business review of its proposed ex ante policy by 

the u.s. Department of Justice (DOJ). In October, the DOJ issued a business review 

letter in response to that request35 In its letter, the DOJ indicated that, unless a 

standards-setting policy is used to conceal naked price fixing or bid rigging, it is analyzed 

under the "rule of reason", in which both the policy's expected benefits and potential to 

restrain competition are examined and assessed. 36 In analyzing the proposed VITA ex 

ante policy, the DOJ concluded that the proposed ex ante disclosure of restrictive 

licensing tenns would promote, rather than hinder, competition among patent holders37 

It observed that such disclosnres would enable working group members to evaluate 

technologies on both "technical merit and licensing tenns," creating incentives for patent 

holders to compete in tenns of royalties and other tenns offered38 The agency concluded 

that the proposed VITA policy was: 

an attempt to preserve competItIOn and thereby to avoid unreasonable 

patent licensing tenns that might threaten the success of future standards 

and to avoid disputes over licensing tenns that can delay adoption and 

implementation after standards are set39 

On January 17, 2007, the eligible VSO membership voted to adopt VITA's 

proposed ex ante policy by a majority of 35-2, with 12 abstentions40 Thereafter, in 

accordance with ANSI's Essential Requirements for developers of American National 

Standards, VITA submitted to the ANSI Executive Standards Council (ExSC) an 

application for re-accreditation.41 VITA's re-accreditation application was opposed by 

Motorola, which argued, among other things, that VITA's ex ante policy failed to comply 

with ANSI's Essential Requirements and that such a policy would disconrage 

34 Draft VITA Patent Policy (Oct. 30, 2006) (available at 

http://www.vita.comldisclosureIVIT A %20Patent%20Policy%20section%20 I 0%20draft.pdf). 

35 DOl VITA Letter, supra note 15. 

36 1dat8. 

37 Id at 10. 

38 Id. at 9. 

39 Id. at 10. 

40 Among the members opposing the approval of the ex ante policy was Motorola, which withdrew from 

VITA following this vote. Lindsay, supra note 24, at 7. 

41 Such fe-accreditation is required each time an ANSI-accredited standards developer significantly alters 

its policies and procedures. Am. Natl. Standards Inst., ANSI Essential Requirements, Sec. 4.1.3 (2010) 

(available at 

http://publicaa.ansi.org/sites/apdl/Documents/Standards%20Acti vitiesl American%20N ational%20Standard 

s/Procedures, %20Guides, %20and%20F orms/20 1 O%20ANSI%20Essential%20Requirements%20and%20R 

elated/20 1 0%20ANSI%20 Essential%20Requirements.pdf). 

Ex Ante Standards Study Report 

June 27, 201 I 

Page 9 
participation in VITA and thereby result in standards of lower quality. Notwithstanding 

this opposition, the ANSI ExSC approved VITA's re-accreditation request on May 28, 

2007, requiring only minor adjustments to the ex ante policy42 Motorola thereafter 

appealed this decision, first to the ExSC and then to the ANSI Appeals Board, both of 

which declined to alter the ExSC decision to re-accredit VIT A43 VITA's ex ante policy 

remains in effect today. 

2. IEEE. The Institute for Electrical and Electronics Engineers (IEEE), 

based m Piscataway, New Jersey, traces its roots to 1884 and early professional 

engineering societies. Today, IEEE has over 350,000 individual members across the 

world and engages in a variety of activities including professional development, 

education, publishing and standards development. Standards development at IEEE is 

conducted through the IEEE Standards Association (IEEE-SA), an operating division that 

is accredited by ANSI as a developer of American National Standards. IEEE standards 

cover a broad of range of electrical and electronics applications including electrical 

safety, equipment disposal, batteries, power distribution and computer networking and 

communications44 Among the best-known IEEE standards today are the 802.3 Ethernet 

standard series and the 802.11 WiFi wireless networking standards. 

Prior to the mid-1990s, IEEE permitted the inclusion of patented technology in an 

IEEE standard if the patent holder agreed to FRAND licensing terms and assured "that 

the technology will be made available at nominal competitive costs to all who seek to use 

it for compliance with [the 1 standard.,,45 Accordingly, patent holders were permitted to 

disclose licensing terms to IEEE on an ex ante basis. One prominent example of such a 

disclosure was made by National Semiconductor Corporation in 1994 with respect to 

certain patented technology that it proposed for inclusion in IEEE's 802.3 Fast Ethernet 

standard. National committed to IEEE that, if its NWay autodetection technology were 

incorporated into the standard, it would grant a license to any party implementing the 

standard for a flat fee of $1,00046 After considering the technical merits of various 

41 See VITA Press Release, VITA Secures ANSI Re-Accreditation, Modifies Patent Policy to Reflect 

Changes in Ex-Ante Disclosure (May 31, 2007) (available at 

http://www.vita.cominewsiVITA%20Secures%20ANSI%20Re-Accreditation%205-2007.pdf). 

43 Final Notice, Appeal Filed by Motorola of the ANSI Executive Standards Council ("ExSC") Decision to 

Reaccredit the Procedures ofVIT ANSO, an ANSI-Accredited Standards Developer (Jan. 22, 200S) 

(available at 

http://www.vita.com/disclosure/ AN SI%20Appeals%20Board%20Decision%20in%20 Motorola%20Appeal 

%2022JanOS.pdf). 

44 See IEEE Standards Association, Find Standards (available at 

http://standards.ieee.orgifindstds/index.html) (last visited June 7, 2011). 

45 IEEE Standards Operations Manuals (1994) §6.3.l (quoted in Lindsay, supra note 24, at 13). 

46 Decision and Order, In the Matter oINegoliated Data Solutions LLC (FTC, Sept. 9, 200S), FTC File No. 

051-0094, Attachment A to Appendix C (Letter dated June 7, 1994 from Mark Grant, Director of 

Intellectual Property, National Semiconductor Corp. to Geoffrey Thompson, Chair, S02.3 Working Group, 

IEEE) (hereinafter "N-Data FTC Decision"). 

Ex Ante Standards Study Report 

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Page 10 
autodetection technologies, the IEEE working group chose NWay for inclusion in the 

Fast Ethernet standard, which was published in 1995 47 

By 1996, however, the permissive disclosure clause of the IEEE policy had been 

removed,48 and the policy approved in January 2005 expressly prohibited disclosing the 

terms or cost of licensing specific patents 49 This trend, however, led to its own 

difficulties, and by the mid-2000s IEEE members were becoming dissatisfied with the 

vagueness of the organization's FRAND licensing commitment and their inability to 

compare cost factors when debating the merits of multiple proposed technologies for 

inclusion in a standard50 Thus, in early 2005, IEEE members proposed further revisions 

to IEEE's patent policy that, among other things, would require ex ante disclosure of 

maximum royalty rates and other licensing terms. After substantial discussion within 

IEEE,5! in December 2006 final amendments to the policy were approved making this ex 

ante disclosure requirement optional rather than mandatory. 52 

Like VITA, IEEE requested a business review from the DOJ and, on April 30, 

2007, the DOJ responded positively to IEEE's proposed ex ante policy. The DOJ 

recognized that IEEE working group members would be able to make "better informed 

decisions" by considering. the cost of competing technologies along with their technical 

merits. It concluded that the IEEE proposal represented 

today. 

a sensible effort to preserve competition between technological 

alternatives before the standard is set in order to alleviate concern that 

commitments by patent holders to license on RAND terms are not 

sufficient to avoid disputes ... ,,53 

The IEEE ex ante policy went into effect on April 30, 2007 and remains in effect 

47 See Lindsay, supra note 24, at 12-13. National's royalty commitment became the subject of dispute in 

2008 after the relevant patents were assigned, in a series of transactions, to a third party that did not wish to 

honor National's original commitment. See N-Data FTC Decision, supra note 46. 

48 IEEE Standards Operations Manuals (1996). 

49 See IEEE-SA Standards Board Operations Manuals (2005) §5.3.9 (prohibiting, among other things, 

communications relating to "the validity, terms or cost of specific patent use"). See also Tor Winston, 

Innovation and Ex Ante Consideration of Licensing Tenns in Standard Setting, U.S. Dept. Justice 

Economic Analysis Group Discussion Paper EAG 06-3 at 4 and n.7 (Mar. 2006) (available at 

http://www .j ustice.gov/atr/pub lic/eag/22IS7 5 .pdf). 

50 See U.S. Dept. of Justice, Business Review Letter to Institute of Electrical and Electronics Engineers 

(IEEE) at 4 (Apr. 30, 2007) (hereinafter, "DOJ IEEE Letter"). 

51 See IEEE, PatCam Drafting Committee Documents (available at http://grouper.ieee.org/groups/ppdialog!) (last accessed on June 8, 2011) (describing the multiple drafts, hundreds of written comments and 

marathon conference calls conducted during 2006 to reach agreement on amendments to the IEEE patent 

policy). 

52 A number of additional policy amendments were also introduced, including a requirement that a 

standardized form of Letter of Assurance (LOA) be used. 

53 DOJ IEEE Letter, supra note 50, at 11-12 

Ex Ante Standards Study Report 

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3. ETSI. The European Telecommunications Standards Institute (ETSI), 

based in Sophia-Antipolis, France, was formed in 1988 following a recommendation by 

the European Commission to supplement the two then-existing EU standards bodies, the 

European Committee for Standardization (CEN) and the European Committee for 

Electrotechnical Standardization (CENELEC)54 ETSI focuses on standards for 

telecommunications, information technology and broadcasting and, unlike CEN, 

CENELEC and the more established International Telecommunications Union (lTU), 

ETSI's membership is open both to governmental actors and private industry. Today 

ETSI has more than 700 corporate members and is responsible for the widely-adopted 

GSM and UMTS mobile telephony standards. 

ETSI proposed its first intellectual property policy in March 1993 in response to 

member concerns regarding patent hold_up55 This policy required ETSI members to 

grant FRAND licenses to all patents necessary to implement current and future ETSI 

standards, other than members who refused to agree to ETSI's licensing terms. This 

exclusion led to an investigation of ETSI's policy by the Commission in 1994 and a 

November 2004 revision of the draft policy that required disclosure of patents and broad 

FRAND licensing56 In 2005 the Commission again initiated an investigation of ETSI 

and its patent policy, this time fueled by concerns that the obligation of ETSI members to 

disclose essential patents was too weak. 57 ETSI amended its policy in November 2005 to 

address the Commission's concerns. 58 At the same time it formed a group to study 

additional policy revisions including the potential introduction of ex ante licensing 

disclosures, which the Commission had previously acknowledged as having the potential 

to offer "pro-competitive beneflts.,,59 

The ETSI group studying ex ante disclosure considered various options, and in 

2006 proposed a model in which the total patent royalty payable with respect to a 

particular ETSI standard would be determined in advance, with resulting royalty 

payments being split among patent holders in a proportional manner, 60 The Commission, 

however, felt that such a system could preclude price competition and subvert the 

otherwise pro-competitive benefits of ex ante licensing disclosures,6J Accordingly, ETSI 

54 See European Commission, Green Paper on the Development of the Common Market for 

Telecommunications Services and Equipment, COM (87) 290 final (June 13, 1987). 

55 See Maurits Dolmans, Standards for Standards, 26 FORDHAM INTL. LJ. 163, 181 (2002) and Rudi 

Bekkers & Joel West, IPR Standardization Policies and Strategic Patenting in UMTS at 5-6 (presented at 

25th Celebration Conference 2008 on Entrepreneurship and Innovation - Organizations, Institutions, 

Systems and Regions). 

56 See Dolmans, supra note 55, at 179, n.6S. 

57 See Pierre-Andre Dubois, Standardization, FRAND Terms and Patent Misuse - Recent Developments, 

EUROPEAN ANTITRUST REv. 2007 at 68. 

58 See id. at 68-69 (describing the change to Section 4.1 ofthe ETSI policy). 

59 See European Commission Press Release, Competition: Commission Welcomes Changes in ETSI IPR 

Rules to Prevent 'Patent Ambush', Dec. 12,2005. 

60 See TAPIA, supra note 24, at 165. 

61 Letter dated June 21, 2006 from Angel Tradacete Cocera, Director - Information, Communication and 

Media, European Commission Competition Directorate-General, to Karl Heinz Rosenbrock, ETSI Director 

General. Despite the Commission's lukewarm reaction to ETSI's collective royalty cap proposal, it 

Ex Ante Standards Study Report 

June 27,2011 

Page 12 
abandoned this approach and in 2007 adopted a voluntary ex ante pOlicy62 To date, 

however, it appears that no ex ante licensing disclosures have been made under ETSI's 

policy63 

4. Consortia (W3C and NGMN). While the ex ante policies at VITA and 

IEEE have to date received the most attention from U.S. commentators and regulators, a 

number of other organizations have adopted or considered policies designed to alleviate 

the risk of patent hold-up in standards-development through early notice of licensing 

terms. Several organizations, most notably the Worldwide Web Consortium (W3C)64 

have adopted policies requiring that participants holding patents essential to the 

implementation of a standard license these patents to all implementers of the standard on 

a royalty-free basis. Such royalty-free (RF)65 policies, mandating royalty rates of zero 

(except under certain exceptional circumstances), could be considered a sub-species of ex 

ante policies, as the royalty rate is known to implementers as soon as essential patents are 

disclosed. Other groups, such as open software standards-developer OASIS, permit 

technical committees to determine, upon formation, whether they will require FRAND or 

RF licensing commitments from their participants. 66 

Consortia have also experimented with formal ex ante policies. One such group, 

the Next-Generation Mobile Networks consortium (NGMN), was formed in 2006 by 

mobile telephone network operators not to develop standards, but to advance operator 

interests and technical requirements within telecommunications-focused SDOs such as 

ETSr.67 Although NGMN itself does not develop standards, it requires each of its 

members to disclose to a trusted third party the royalties and other material terms on 

which it would be willing to license its patents essential to the implementation of certain 

industry standards68 The trusted party then aggregates and anonymizes this royalty 

information and provides it in a confidential report to the NGMN membership69 

remains supportive of ex: ante disclosure structures generally. See Ee Horizontal Guidelines, supra note 

14, at ~299. 

62 ETSI, Ex Ante Disclosures of Licensing Tenns (available at 

http://www.etsi.orglWebSite/AboutETSlIIPRsInETSlIEx-ante.aspx) (last visited June 7, 2011). 

63 See ETSI, List of Ex Ante Disclosures of Licensing Terms (available at 

http://www .etsi.org/W ebSite/ AboutETSIII P RslnETS VEx -ante-list -of-disclosures.aspx) (last visited June 7, 

2011) (no disclosures listed). 

64 www.w3c.org. 

65 A number of variants of RF policies exist, including so-called RAND-RF or RAND-Z policies, which 

require the imposition of otherwise RAND terms, but with no royalty or other consideration charged. See 

ABA Manual, supra note 8, at 56-58. 

66 OASIS Intellectual Property Rights (lPR) Policy (available at http://www.oasis-open.org/policiesguidelines/ipr#1icensing reg) (last visited June 6, 2011). 

67 See Next Generation Mobile Networks, Mission and Vision (available at 

htlp:llwww.ngmn.org/aboutus.html) (last visited June 6, 2011). 

68 NGMN, Participant Application Form, Annex 2 - IPR Guidelines, §2.a (available at 

http://www .ngnm.org/fileadminluser upload/Dovmloads/Membership/NGMN IPR Guidelines.pdf). The 

selected standards include 3GPP Long Term Evolution (LTE), IEEE 802. 16M, IEEE 802.20 and 3GPP2 

Ultra Mobile Broadband. Id. at § l.i. 

69 1d. at §7. 

Ex Ante Standards Study Report 

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Page 13 
The intent of this procedure was to encourage full and frank disclosure of royalty 

rates by ensuring that no individual member's licensing terms became known to the 

others (its competitors). Each member, however, would learn the aggregate royalties that 

would be payable with respect to each standard of interest and thus, presumably, have a 

basis on which to compare the economic desirability of these different standards. It is 

unclear whether these goals have been achieved in practice. First, it has been reported 

that the aggregate royalty rates for different standards have been surprisingly high (by 

one account, 130% of the net sales price of the equipment in question)70 Others have 

noted that the reported royalty structures have been unduly complex and difficult to 

compare, and that the trusted party's reports have extended to hundreds of pages, making 

them cumbersome and difficult to use. 

Thus, while NGMN has taken positive steps toward the implementation of an ex 

ante policy, the aggregated and anonymized nature of the reported information and the 

fact that NGMN itself does not develop standards, make it an unlikely candidate for 

assessing the effect of an ex ante policy on the standards-development processes 

addressed by this study. 

5. IETF and "Informal" Ex Ante Approaches. The Internet Engineering 

Task Force (IETF)71 is the primary developer of Internet architecture, transport and 

security protocols, specifications and standards worldwide. The IETF grew out of early 

U.S. government/academic projects that designed the basic architecture of the packetswitched network that eventually became the Internet. Since 1992, IETF's activities have 

been conducted under the auspices of the non-profit Internet Society, based in Reston, 

Virginia and Geneva, Switzerland. Like IEEE, participation in IETF is on an individual 

basis, though many companies sponsor the attendance and participation of their 

employees in IETF activities. In recent years, at any given time over a hundred different 

working groups have been operational within IETF. IETF was responsible for the 

development of fundamental Internet protocols including TCP, IP, HTTP and MIME, and 

has never sought accreditation from ANSI as a developer of American National 

Standards. 

The IETF's policy regarding patents was initially developed in 1992 as part of 

RFC 1310,72 and contained a FRAND or RF licensing requirement based on the thencurrent ANSI Essential Requirements. The basis for the current IETF patent policy, 

however, was established in 1996 as part of RFC 2026, and only requires that participants 

disclose the existence of known intellectual property rights covering contributions to 

IETF, but does not require that the patent holder grant any license at all to implementers 

70 TAPIA, supra note 24, at 194. 

71 www.ietf.org. 

72 For historical reasons, IETF standards are designated as "Requests for Comments" or "RFCs". In the 

IETF, both technical standards and documents setting forth the organization's rules and policies are 

published as RFCs. 

Ex Ante Standards Study Report 

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Page 14 
of the standard.73 While more detailed, IETF's current policy contained in RFC 3979 and 

subsequent addenda preserves this disclosure-only approach. 74 

While requiring that patent disclosures contain certain specified information (such 

as patent and patent application numbers, dates, affected standards, and the like), IETF 

does not require that such disclosures be made in any particular format. Thus, IETF 

participants are free to include additional information in their patent disclosures, so long 

as this information does not contravene any express IETF requirement (e.g., alterations to 

copyright permissions). Given this freedom, many IETF participants have elected to 

include information regarding their licensing intentions in patent disclosures. This 

licensing information can include commitments to license on FRAND or royalty-free 

terms, discussions of specific clauses that will be applicable to licenses, and broad 

commii:ments not to assert patents in enumerated contexts. And while IETF does not 

require a licensing commitment or ex ante disclosure of licensing terms, it does not 

prohibit the disclosure of this information. I refer to this combination of tacit approval by 

the organization and established practice within the community as an "informal" ex ante 

approach. 

III. Study Aims and Methodology 

A. Study Aims 

The aim of this study is to collect and analyze empirical data relevant to the effect 

of ex ante policies on standards development. We have organized our data collection and 

analysis in accordance with predictions made by critics of ex ante policies regarding the 

potential effects of such policies on standardization processes and efficacy. In particular, 

our data collection and analysis has been organized around the following six assertions 

relating to ex ante policies: 

1. Ex ante policies will reduce standardization activity. 

2. Ex ante policies will cause standards to take longer to develop. 

3. Ex ante policies will require standards developers to devote more time to 

standardization activities. 

4. Ex ante policies will cause members to withdraw from SDOs that adopt 

them. 

5. Ex ante policies will cause standards to decrease in quality. 

73 Internet Engineering Task Force, RFC 2026 -- The Internet Standards Process - Revision 3 (Oct. 1996), 

~10.3.1.6. 

74 Internet Engineering Task Force, RFC 3979 -Intellectual Property Rights in IETF Technology (Mar. 

2005). 

Ex Ante Standards Study Report 

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6, Ex ante policies will depress patent royalty rates, 

B, Methodology 

L SDOs Selected. As VITA is the only SDO to adopt a mandatory ex ante 

requirement that has been considered by the U,S, Department of Justice, VITA was the 

primary focus of our data collection and analysis, Much VITA data is not pUbliclyavailable, thus we relied heavily on the cooperation of VITA's executive director and 

staff in providing us with requested information, 

Like VITA, IEEE adopted an ex ante policy in early 2007 and obtained a business 

review letter from the Department of Justice, Unlike VITA, however, IEEE's ex ante 

policy permits ex ante disclosure of licensing terms, but does not require it, In this 

respect, IEEE presents an interesting contrast to VITA, Accordingly, we collected data 

relating to lEEK Much IEEE data is publicly-available on the organization's web site 

(www,ieee,org), To the extent that data was not publicly-available, we were able to 

obtain limited information from IEEE staff, However, as noted below, some IEEE data 

was either unavailable or not made accessible to us, 

In addition to VITA and IEEE we collected data from IETF, which has not 

adopted an express ex ante policy but which, as noted above, permits informal ex ante 

disclosures, Given the size and prominence ofIETF, we believe that it can be viewed as 

representative of general trends within the leT standards-development community, Most 

IETF data is publicly-available on the Internet (v,'Wwjetf,org), making it a common 

subject of academic analysis and commentary, We did not seek non-public data from 

IETF, 

We did not collect or analyze data relating to ETSI, NGMN or other SDOs, for a 

number of reasons, First, we felt that our primary emphasis, at this stage, should be on 

organizations with a primary connection to the U,S, Second, the ex ante policies of 

VITA and IEEE have received the greatest attention from U,S, commentators, most likely 

due to the issuance of DOJ business review letters to each of these organizations, ETSI 

and NGMN have received less attention from U,S, commentators and regulators, and 

have played a smaller role in the ex ante debate as it has evolved in the U's, Third, the ex 

ante policies and practices of ETSI and NGMN are not condusive to empirical study fora 

number of reasons, ETSI, as noted above, has to-date received no disclosures under its ex 

ante policy, NGMN is not an SDO and does not develop standards, Thus, the predicted 

effects of ex ante policies on NGMN would be difficult to compare with the effects on 

SDOs such as VITA and IEEK Moreover, the aggregated nature of NGMN's ex ante 

disclosures make them still more difficult to compare to the others, As noted above, we 

included IETF in this study for comparative purposes, as a large, well-respected SDO in 

the same industry category as VITA and IEEE, with all relevant data available in the 

public domain and with the benefit of numerous academic studies to use as bases for 

comparison, For these reasons, we elected to focus this study on VITA, IEEE and IETE 

Ex Ante Standards Study Report 

June 27, 2011 

Page 16 
2. Time Period. As our goal was to examine the effect that the adoption of 

ex ante policies had on SDO procedures and practices, we generally collected and 

analyzed data from 2004 to 2010, three years before and after the adoption of the VITA 

and IEEE policies in 2007. In categories in which VITA lacked relevant data for 2004 

(e.g., standards adopted), we extended our start date to 2003. With respect to patent and 

licensing disclosures, we limited our review to the period 2007-2010, as both VITA and 

IEEE adopted their ex ante policies in early 2007, and data prior to that period was not 

useful for comparison. 

3. Historical Data. 

a. Disclosures. For each of VITA, IEEE and IETF we reviewed 

formal disclosures of patent infonnation made from 2007 to 2010. Formal disclosures 

are those submitted directly to the SDO through its established patent disclosure 

mechanisms, and do not include unofficial notices, letters, e-mail discussions, litigation 

filings or other means of communication. 

VITA does not publish disclosures made under its ex ante policy. However, 

following submission of VITA standards to ANSI for approval as American National 

Standards, ANSI has published some VITA disclosures on its web site75 In order to 

analyze information regarding both ANSI-approved and draft VITA standards, we 

obtained copies of all ex ante disclosures directly from VITA. 76 Due to the non-public 

nature of VITA disclosures pertaining to draft standards, we agreed not to disclose the 

specific terms of VITA ex ante disclosures to the extent they are not already publiclyavailable via the ANSI web site. 

With respect to IEEE, we obtained this information from the Letters of Assurance 

available at the "IEEE-SA Records of IEEE Standards-Related Patents" found on the 

IEEE public website77 With respect to IETF, we obtained disclosure information from 

the list ofIPR Disclosures found on the IETF public website. 78 

In each SDO, disclosures are permitted with respect to both draft and approved 

standards. We counted all such disclosures equally, and our statistics relating to 

"Standards Covered by Patent/Licensing Disclosures" reflect disclosures covering both 

standards starts and approved standards. While all standards starts may not ultimately 

lead to approved standards, whether or not a standards activity will lead to an approved 

standard is not known at the time of disclosure, making the eventual approval of the 

standard somewhat irrelevant to the decision whether or not to disclose. In many cases, 

individual disclosures state that they apply to multiple standards and/or draft standards. 

75 SDO patent disclosures submitted to ANSI can be found at 

http://pub Ii caa.ansi .org! sites/apdllP atent%2 0 Letters/F arms! AlII tems.aspx. 

76 Materials provided on March 1,2011. Some of this information is publicly-accessible on the web site of 

the American National Standards Institute (ANSI) at www.ansi.org. 

77 http://standards.ieee.orgldb/patentsiindex.html.AsofApriI2011,this link was moved to 

http://standards.ieee.orglabout/sasb/patcornlpatents.htm 1. 

78 https:lldatatracker.ietf.org/ipri. This information can also be accessed by searching for the RFC number 

in the IETF's online IPR Disclosure database at https://datatracker.ietf.orgliprlsearchl. 

Ex Ante Standards Study Report 

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Page 17 
We counted separately each individual standard or draft standard to which a particular 

disclosure purported to apply. In the case of IETF, if disclosures identified different 

versions of an Internet-Draft, we counted each different Internet-Draft version. 

In most cases, each disclosure cites a single patent. In a minority of cases, 

however, disclosures cite multiple patents, including non-U.S. counterparts, divisional 

and continuation applications. Thus, although, as noted above, we counted the number of 

separate standards cited by each disclosure, we did not separately count each patent cited 

in each disclosure. We adopted this approach because the focus of our study is on 

numbers of standards rather than numbers of patents. Thus, so long as a disclosure 

identifies all standards implicated by the disclosed patent(s), it is not meaningful whether 

the patent holder claims to have one or a dozen patents that are essential to the 

implementation of that standard. We excluded from the IEEE count of disclosures 

Letters of Assurance that simply stated that the submitter was not aware of any patents an 

option permitted by the IEEE form Letter of Assurance), as these are not patent 

disclosures of the type under review. 

In describing the terms of ex ante licensing disclosures, our use of the term 

"Royalty-Free" includes disclosures stating that patents will be licensed on a royalty-free 

basis, that the patent holder will not assert patents against implementers of the standard or 

that no license is required to operate under such patents. The addition of reciprocity, 

defensive suspension and other customary terms of standards-based FRAND licenses to 

such Royalty-Free declarations, and the offer of optional royalty-bearing tenns in 

addition to royalty-free terms, did not change our classification of a disclosure as 

Royalty-Free. We did not account for the fact that at IETF all computer code included 

within standards is licensed under the open source BSD license. When counting 

disclosures that included non-royalty license terms, we did not count disclosures that 

simply listed FRAND commitments (as most IEEE Letters of Assurance do). We 

counted a disclosure as including non-royalty licensing terms if it included an attached 

license agreement or described non-royalty terms other than simple FRAND assurances, 

such as reciprocity, defensive suspension, field limitations, or the like. 

b. Standards Started. For each of VITA, IEEE and IETF we 

determined the number of new standards-development activities initiated during each 

year from 2004 to 2010. IEEE and IETF data were obtained from the public web sites of 

each organization79 VITA data were obtained directly from the organization80 

For VITA standards, we counted all standards started during each year studied. 

When two related standards were started on the same date (e.g., VITA 49.0 and 49.1, 

both of which were started on June 24, 2004), we considered these to be separate 

79 IEEE Standards Status Report obtained from http://standardsjeee.orgldb/status/status.txt on Oct. 14, 

2010 (now available at http://standards.ieee.org/developiproject/status.html). IETF data was manually 

compiled from the IETF Datatracker at htlps:/ldatatracker.ietf.org for standards approved through Nov. 30, 

2010. 

80 Data provided by VITA on Apr. 18,2011. 

Ex Ante Standards Study Report 

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Page 18 
standards, as each potentially has a separate technical implementation, product base and, 

m t . h 81 eory, patent coverage. 

For IEEE standards, we deemed the "start" date to be the date on which the 

Project Authorization Request for the standard was approved. We did not count as 

separate standards 26 different corrigenda, as these are generally technical corrections to 

existing standards. Five other "standards" were also excluded where the description noted 

that only minor changes were being made to existing standards, 

For IETF, we considered the publication of a new IETF Internet-Draft to 

constitute the "start" of a new standardization process. An Internet-Draft is a draft 

document that may progress through the IETF standardization process. Many InternetDrafts, however, do not advance to become IETF standards (designated as Requests for 

Comments or RFCs), and many are informational in nature and are never intended to 

advance along the "standards track". In addition, many Internet-Drafts that are intended 

to be standards-track documents are eventually combined with other Internet-Drafts or 

superseded, by different technical approaches reflected in different Internet-Drafts. Thus, 

there are many more Internet-Drafts published in any given year than standards adopted 

at IETF. Nevertheless, for IETF, the publication of new Internet-Drafts seemed best to 

reflect the number of new standardization activities begun during any given time period. 

As this data is being used primarily to compare trends among VITA, IEEE and IETF, the 

absolute number of new standards starts at IETF is not itself as significant as the changes 

in the number of new standards starts year to year. 

In order to measure the number of new Internet Drafts published each year at 

IETF, we reviewed the "IETF Chair Report" of each IETF meeting starting from IETF 59 

(Seoul, February 29-March 4, 2004) and ending with IETF 79 (Beijing, November 7-12, 

2010).82 Beginning with IETF 61, each such IETF Chair Report includes a slide that 

notes how many new Internet-Drafts were started since the last meeting. Because IETF 

meetings are held in (roughly) March, July/August and November of each year, and the 

number of new Internet-Drafts reported are since the last meeting, the "annual" totals that 

we calculated for IETF reflect figures from November to November of each year, rather 

than a true calendar year. In addition, because the IETF Chair Reports did not begin to 

report new Internet-Drafts until IETF 61 (November 2004), we had incomplete data for 

2004. In order to estimate the total number of new Internet-Drafts for 2004, we 

extrapolated full-year data from the partial-year data presented in November 2004. 

c. Standards Approved. For each of VITA, IEEE and IETF we 

determined the number of standards approved during each year from 2003 to 2010. IEEE 

and IETF data were obtained from the public web sites of each organization. VITA data 

were obtained directly from the organization83 

81 In contrast, when computing average time to standardization, we combined related standards so as not to 

double-count a single standardization process. 

82 A list ofthese meeting links can be found at http://www.ietf.orglmeeting/proceedings.html. 

83 Data provided by VITA on Mar. 1,2011. 

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For VITA standards, we counted all standards adopted during each year studied. 

When two related standards were approved on the same date (e.g., VITA 49.0 and 49.1, 

both of which were approved on May 26, 2009), we considered these to be separate 

standards.84 

For IEEE standards, we deemed the date of "approval" to be the date on which the 

IEEE-SA Board approved the standard. We did not count as separate standards 26 

different corrigenda, as these are generally technical corrections to existing standards. 

Five other "standards" were also excluded where the description noted that only 

extremely minor changes were being made to existing standards. In many of these cases, 

the standard was both proposed and approved on the same day or very shortly thereafter. 

For IETF standards, we identified each Request for Comments (RFC), the official 

designation for IETF standards, published during 2004 to 2010. The IETF Datatracker 

web site" displays the "History" of each such RFC. From the History tab for each RFC, 

we identified the date on which such RFC was "Approved - announcement sent" or 

. "Approved - announcement to be sent". We did not use the RFC publication date, as this 

date was often significantly later than the approval date due to delays associated with the 

RFC Editor fimction and not related to the IETF standardization process.

86 

d. Standardization Time. For each of VITA, IEEE and IETF we 

determined the average time between the introduction of a draft standard and its final 

approval by the SDO for all standards approved from 2003 to 2010. IEEE and IETF data 

were obtained from the public web sites of each organization. VITA data were obtained 

directly from the organization. For purposes of this analysis, we did not consider draft 

standards documents that did not result in approved standards as of December 31, 20 I O. 

For each VITA standard adopted between 2003 and 2010, we measured the 

number of days between the introduction of the original technical proposal and the 

resulting standard's final approval, then calculated the average number of days required 

for adoption of all standards during each such year. For purposes of this calculation, we 

combined related standards that were started and approved on substantially the same 

dates. For example, VITA 48.0, 48.1 and 48.2 were each started on January 21,2004. 

VITA 48.0 and 48.2 were approved on June 22, 2010 and VITA 48.1 was approved on 

July 7, 2010, approximately two weeks later. Given that these three standards relate to a 

common set of specifications and were developed as part of a single standardization 

process, all three are considered as a single standard for purposes of determining the 

length of VITA standardization processes, notwithstanding that the approval of VITA 

48.1 required two additional weeks at the end of a six-year standardization process. 

84 In contrast, when computing average time to standardization, we combined related standards so as not to 

double-count a single standardization process. 

85 http://datatracker.ietf.org. 

86 This distinction is discussed by Simcoe in his study ofIETF standards. Tim Simcoe, Delay and de jure 

Standardization: Exploring the Slowdown in Internet Standards Development in STANDARDS AND PUBLIC 

POLICY 260 (2006) (available at 

http://www.rotman.utoronto.ca/strategylrese~chlworking%20papers/Simcoe%20-%20Delays.pdf). 

Ex Ante Standards Study Report 

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For IEEE standards, we measured the number of days between the approval of a 

standard's Project Authorization Request and IEEE-SA board approval. In cases in 

which a standard was proposed and dropped without board approval, then subsequently 

resubmitted and approved, we considered this to be a single approval process measured 

from the initial Project Authorization Request. If the standard was approved by the board 

and later amended in a separate approval process, we counted it as two different 

standards with two different approval periods. 

For IETF Standards, we measured the number of days between the publication of 

the initial Internet-Draft referencing the standard and the approval of the resulting RFC 

for publication. When subsequent Internet-Drafts replaced or superseded earlier InternetDrafts relating to the same standards activity, we counted from the initial Internet-Draft 

publication. 

e. Membership Data. For each of VITA and IETF we compiled 

overall membership data, specifically the number of members joining and withdrawing 

from each organization, for each annual period from 2004 to 2010. We were unable to 

obtain comparable membership data from IEEE87 

With respect to VITA, we obtained a current list of VITA members from the 

organization88 For prior years, we referred to the roster of VITA members on publiclyarchived versions of VITA's public website for each year from 2004 to 200989 We 

recorded the number of members who joined and withdrew from the organization in each 

year and calculated the net change in membership for each such year. For the reasons 

discussed below, we made a number of adjustments to the raw data that we used to 

calculate net year-to-year membership changes. 

First, VITA permits related entities (e.g., parent, subsidiary and sibling 

companies) to maintain separate memberships in the organization, so long as each such 

entity pays the required membership dues. For purposes of this study, we treated related 

entities as a single member. We adopted this approach because the purpose of this 

analysis is to measure the effect of the adoption of VITA's ex ante policy on membership 

in the organization. Because, in our view, intellectual property decisions are likely to be 

made centrally rather than at the subsidiary level, treating related entities as separate 

87 Unlike VITA and IETF, IEEE is a broadly-focused trade association that conducts numerous activities in 

addition to technical standards-setting. Overall membership in IEEE is in the range of 350,000 individuals 

and entities (see http://www.ieee.orgiabout/corporate/annuaireport.htm!). Standards-setting within IEEE 

is conducted within the IEEE Standards Association (IEEE-SA), which does not publish separate 

membership lists or statistics. 

88 List provided Dec. 23, 2010. 

89 We accessed archived versions of the VITA website using the Internet Archive 

http://www.archive.on!lweb/web.php. The specific URLs accessed were 

http://web.archive.orglweb/*/http://www.vita.com and http://waybackmachine.orgl*lhttp://www.vita.com. 

We collected VITA membership data from the VITA membership pages archived for the following dates: 

Dec. 5, 2000, June 28,2001, Nov. 29, 2002, Dec. 20, 2003, Dec. 29, 2004, Dec. 23, 2005, Dec. 27, 2006, 

Oct. 12,2007, Dec. 17,2008, and Mar. 16,2009. 

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members could give undue weight to the decisions made by these entities 90 A total of 

eleven different groups of related entities (two entities in ten cases and three entities in 

one case) were thus counted as eleven individual members. By the same token, when one 

entity withdrew and was replaced by a related entity during the same year, we counted 

neither the departure of the first entity nor the addition of the second entity as a change in 

membership. 

Second, based on information provided by VITA staff,91 we disregarded (for 

counting purposes) the departure of VITA members due to their acquisition by other 

VITA members (as such departures would not be indicative of a desire by the departing 

members not to remain in the organization). In each year measured, between two and ten 

departures were disregarded for this reason.92 If, however, a VITA member departed the 

organization following its acquisition by a non-member, this departure was counted and 

no adjustment was made to the departure count. Given the various adjustments to the 

VITA membership count described above, we felt that presenting either raw or adjusted 

membership figures would be less informative than presenting the net changes in VITA 

membership year over year, using 2004 as a baseline. 

With respect to IETF, we compiled meeting attendee information from North 

American IETF meetings held between 2004 and 2010, as listed on the IETF public web 

site93 North American meetings were selected in order to provide the most consistent 

basis for comparison with VITA, the membership of which is drawn primarily from 

North America. 

90 For example, VITA membership records for 2005 and other years list both Lockheed Martin and 

Lockheed Martin Integrated Systems as members. Based on Ollr experience, decisions regarding 

intellectual property policy within large organizations are typically made by a centralized general counsel's 

office and are followed by all divisions and subsidiaries within the corporate group. 

91 Telephone Interview of Ray Alderman, Mar. 17,2011 (conducted by Contreras). 

91 The table below shows the number of VITA departures per year that were disregarded because the VITA 

member was acquired by an entity that was already a VITA member: 

AJdennan Interview, supra note 91. 

93 http://www.ietf.org/meeting/past.html. The meetings selected were: 60th IETF (Aug. 2004, San Diego, 

CAl; 62"' IETF (Mar. 2005, Minneapolis, MN); 65'h IETF (Mar. 2006, Dallas, TX); 69'h IETF (luI. 2097, 

Chicago, IL); 71" IETF (Mar. 2008, Philadelphia, PAl; 74'" IETF (Mar. 2009, San Francisco, CAl; and 77'" 

IETF (Mar. 2010, Anaheim, CAl. 

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Unlike VITA, IETF membership is on an individual, rather than a corporate basis. 

Thus multiple individuals employed by the same company can, and do, attend IETF 

meetings, and each is counted as a separate attendee. We made no adjustments to IETF 

attendance data to account for multiple attendees from the same company or otherwise, as 

determining such information was not feasible. While IETF meeting attendance does not 

provide a perfect basis for comparison with VITA corporate membership, IETF 

attendance rates are believed to be indicative of overall trends in SDO participation in the 

ICT sector during the period under review. 

f. Citation Data. For each VITA standard approved between 2003 

and 2010,94 we conducted a Google web search and recorded the number of "hits" 

returned by Google. The search was conducted on May 25, 2011. Each search query 

was constructed in a uniform manner using the term "VITA", the numerical designation 

of the standard and all words from the title of the standard excluding articles, 

conjunction, punctuation marks and the words "draft", "standard" and "specification". If 

words were repeated within the title of the standard we did not repeat them in the query. 

For example, the search query constructed for VITA 58.0 "Line Replaceable Integrated 

Electronics Chassis Draft Standard" was "VITA 58.0 Line Replaceable Integrated 

Electronics Chassis". We plotted the results on a natural logarithmic scale (y-axis) 

against date of adoption (x-axis). 

4. Survey Data. In order to provide greater context to the historical data 

described above, we conducted an online survey of all current VITA VSO participants 

(88 individuals)95 

a. Administration; Response Rate. The survey included 26 questions, 

most of which called for closed-ended, multiple choice responses (described in more 

detail below).96 The survey was conducted between March 3 and March 18,2011 using 

the Survey Monkey online survey administration tool. 97 An initial e-mail solicitation 

containing a link to the secure survey web site and privacy statement was sent to each 

VSO member by the VITA Executive Director. Two short reminder notices were also 

sent during the course of the survey. No incentives were offered to respondents other 

than an offer to share the results of the study. A total of 47 responses were received 

(response rate 53.4%; margin of error 9.8%98). 

b. Demographic Data. The survey included 14 demographic 

questions. Respondents were asked to report the industry sector of their employer 

(product vendor, product purchaser, regulator, academic, other), their job function 

94 We excluded one standard, VITA 57.1fl, from this calculation, as this standard is labeled solely as a 

revision to the existing standard VITA 57.1 and the If I version, standing alone, received no hits. 

95 Though we sought permission to survey participants in the IEEE Standards Association, IEEE declined 

this request. In a future study, it may be desirable to survey a broader cross-section of leT standardization 

professionals. 

96 Approved by Washington University in St. Louis, Human Research Protection Office (HRPO), Feb. 11, 

20!! (IRB ID#201102234). 

97 www.surveymonkey.com. 

98 Calculated using standard margin of error formula for finite populations: N=88, n=47. 

Ex Ante Standards Study Report 

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(engineering, business/management, legal, marketing, other), and their general level of 

experience with technical standardization, patents and patent litigation. Several questions 

also asked for information regarding the respondent's practices in connection with 

standards-development at VITA, including the frequency with which the respondent 

checks patent and licensing disclosures made in connection with VITA standards under 

development. A summary of the demographic characteristics of the survey respondents 

is contained in the Data Appendix. 

c. VITA-Specific Questions. The survey included 12 questions that 

solicited information regarding the respondent's experiences with, and impressions of, 

standards-development at VITA both before and after adoption of the 2007 ex ante 

policy. Questions required the respondent both to compare standards-development at 

VITA with standards-development at other SDOs, and to compare standardsdevelopment at VITA before adoption of the ex ante policy with standards-development 

at VITA following adoption of the ex ante policy. Variables measured included speed of 

standards-development at VITA, length of time spent by the respondent on VITA 

standards-development and quality of VITA standards. Additional questions asked for 

information regarding the respondent's actions taken in response to ex ante licensing 

disclosures, and to the adoption of the VITA ex ante policy. 

d. Analysis 99 Descriptive and bivariate analyses were conducted on 

all closed-ended survey questions using SAS version 9.2 for Windows. Bivariate 

associations between respondent experience levels and other demographic data and 

perceptions regarding the effect of the ex ante policy on VITA's standardization 

processes were analyzed. Significance was assessed at p<O.OS. Due to the small sample 

size (n~47), Fisher's exact test was used to assess bivariate associations. 

99 Analysis conducted by Dr. Melody Goodman, School of Medicine, Washington University in 8t. Louis. 

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IV. Findings and Analysis 

A. SDO Patent and Licensing Disclosures. 

I. Comparative Disclosure Data. As discussed in Section JLG above, VITA, 

IEEE and JETF each address ex ante disclosures of licensing information in different 

ways: VITA requires ex ante licensing disclosures, IEEE expressly permits them, and 

IETF permits free-form disclosures that may, and sometimes do, include licensing 

information. Table. A.I below compares each organization's patent and licensing 

disclosures from 2007 (the year in which VITA and IEEE approved their ex ante policies) 

through 2010. 

Ratio of 

Table A.I 

Disclosure 

Lo,velreuby Patent 

7 

1: 2.6 

35 389 

1 : 9.5 I : 3.2 

A number of observations emerge from this data. First, the percentage of each 

organization's standards (both approved and draft) that are covered by patent disclosures 

is surprisingly consistent across the three organizations, despite the wide variance in their 

activity levels. Thus at IETF, which approved 1,243 standards during the period, patents 

were disclosed with respect to 594 separate standards activities, at a ratio of 1:2.1, while 

at VJT A, 7 patent disclosures were made with a total of 18 approved standards, at a ratio 

of 1 :2.6, and at IEEE, the comparable ratio of 1:3.2 was only slightly higher. This level 

of consistency suggests both that the number of patents applicable to standardization 

activities across the JCT sector is relatively constant, and that participants in JCT 

standardization activities comply with SDO patent disclosure requirements at a relatively 

consistent rate. 

Ex Ante Standards Study Report 

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The divergence among the three SDOs becomes apf,arent in the lower portion of 

Table A.I, which compares ex ante licensing disclosures. 00 At VITA, where ex ante 

licensing disclosures are required, each patent disclosure (n=7) also contained licensing 

information. At IETF, 366 of 481 patent disclosures (76%) contained licensing 

information, whereas at IEEE, only II %, or 39 of 349 disclosures contained licensing 

infonnation. We identified two distinct types of ex ante licensing infonnation: royaltyrelated terms and non-royalty terms beyond simple FRAND assurances. In some cases, 

ex ante disclosures contained both royalty-related and non-royalty infonnation. 

Royalty-related tenns included both royalty-free licensing commitments and nonzero royalty rates. The disclosure of non-zero royalty rates was observed almost 

exclusively at VITA, where 86% (n=6) of all ex ante disclosures contained a non-zero 

maximum royalty. At IETF there were no non-zero royalty disclosures, and at IEEE, 

where such disclosures are pennitted but not required, there were only two (6% of all ex 

ante disclosures)101 These observations suggest that, even at SDOs in which ex ante 

disclosure is pennitted, participants that wish to license their patents on a royalty-bearing 

basis may be reluctant to disclose royalty infonnation unless compelled to do so by an 

express ex ante policy. 102 The same is not the case, however, with respect to royalty-free 

licensing commitments, which participants seem willing to disclose voluntarily, even 

absent a policy-based requirement to do so. Thus, while IETF had no royalty-bearing 

disclosures at all, 59% (n=283) of all IETF patent disclosures contained royalty-free 

I

·· . 103 Icensmg commItments. 

Data regarding the ex ante disclosure of non-royalty licensing terms is also worth 

consideration. At IEEE, most of the ex ante licensing disclosures (67%, n=26) were of 

non-royalty information only (e.g., reciprocity, defensive suspension, etc.),104 and a full 

57% (n=276) of all IETF patent disclosures included licensing infonnation beyond a 

simple FRAND or royalty-free licensing statement. Thus, while the principal debate 

concerning ex ante disclosure policies has focused on the disclosure of royalty rates, it 

appears that SDO participants also have an interest in disclosing, and reviewing 

di I f I I

·· 105 sc osures 0 , non-roya ty lcensmg terms. 

100 As discussed in Section III.B.3.a, supra, we consider ex ante licensing disclosures to constitute any 

disclosure oflicensing terms beyond a simple FRAND commitment, and may include royalty-related terms 

andlor other licensing terms. 

101 One of the two ex ante non-zero royalty disclosures made to IEEE was submitted by Negotiated Data 

Solutions (N-Data) following a decision by the Federal Trade COlmnission. See note 46, supra. 

102 Though not part of this study, the experience at ETSI, which appears to have had no ex ante royalty 

disclosures since the adoption of its policy in 2007, supports this hypothesis. 

103 At IEEE, however, only 3% (n=ll) of all patent disclosures contained royalty-free commitments. In 

this case, it is worth noting that IEEE provides a standardized fonn of Letter of Assurance in which most 

disclosers indicate that they are willing to license their patents on FRAND terms. 

104 For an explanation of these and other common FRAND licensing terms, see ABA Manual, supra note 8, 

at 49-67. 

105 Informal discussions with individuals who were involved in the development ofthe IEEE ex ante policy 

confinn that expressly permitting the disclosure of non-royalty licensing terms within the context of IEEE 

standards-development was a goal of the policy. 

Ex Ante Standards Study Report 

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Page 26 
2. Attitudes Toward VITA Policy. We surveyed VITA members regarding 

their general and specific views toward the licensing information solicited by VITA's ex 

ante policy. In general, a significant majority of respondents (83%, n=34) felt that the 

adoption of VITA's ex ante policy made standards development at VITA more open and 

transparent. Only 17% (n=7) noticed no change and none felt that the policy had made 

VITA less open or transparent. With respect to the specific information disclosed under 

the policy, 93% (n=39) of respondents felt that royalty information disclosed by patent 

holders was important to them when considering whether to approve a proposed VITA 

standard. When asked whether the disclosure of a relevant patent affected their desire to 

work on and approve a VITA standard, 43% (n=lS) responded that it depends on the 

licensing terms, and 40% (n=17) responded that it depends on both the licensing terms 

and the patent holder. Based on these data, it appears that, at least among current VITA 

participants, the information disclosed under the ex ante disclosure policy is both desired 

and perceived to be a useful input to the standards-development process. 

B. Number of Standards. 

We counted the number of independent standardization actlvll1es that were 

started, as well as the total number of standards that were approved, each year from 2004 

and 2003, respectively, to 2010 at each of VITA, IEEE and IETF. The number of 

standards approved by an SDO is a relatively common measure of SDO performance. 

The significance of standards starts to SDO performance, however, is less wellunderstood. I 06 We measured both the number of standards activities started and the 

number of standards ultimately approved at each SDO for several reasons. First, we 

sought to understand the effect of the VITA and IEEE ex ante policies on standardization 

processes within these organizations. In both organizations, it takes an average of three 

to five years from the introduction of a proposed standard until it is finally approved. lo7 

Thus, it is probable that very few standards started after the adoption of these policies 

would have been approved at the time of this study. IDS Second, we wanted to test whether 

SDO participants would, as predicted, begin to take standardization proposals elsewhere 

following the adoption of ex ante policies. If this were the case, one might expect 

standard starts to decrease following adoption of these policies, an effect that would be 

seen within the years immediately following policy adoption, and would not exhibit the 

time lag associated with standard approvals. 

1. Standards Starts. 

Table B.1 shows the number of independent standards activities started at each 

SDO from 2004 to 2010. 

106 Thus, while an organization that starts many projects and finishes just a few might not be viewed as 

successful, an organization that starts just a few high-value projects and completes them all might be 

considered a great success. We address quality metrics in Section IV.C, ififra, and in this Section focus 

exclusively on the number of standards processed by an SDO. 

!O7 See Section IV.B, infra. 

108 This fact suggests that further study may be appropriate in a few years time, after a substantial number 

of standards approved in a given year were started in 2007 or later. 

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Table B.l 

Number of New Standards Activities (2004-2010) 

••••.•••..• ····;· •.. ·..l;.· "IEEE JETF 

Range 5-19 78-187 1085-1533 

Std. deviation (a) 5.44 40 153 

Mean2004-06 11.0 83 1317 

Mean2007_10 10.3 138 1346 

Slope (m2004.07)* -0.24 0.04 0.14 

Slope (m2007.10)* -0.04 0.26 0.19 

* normalIzed to 1.0 

Figure B.l.a shows the number of standards starts at VITA during this period. 

Figure B.1.a 

VITA Standards Activities Started by Year (2004-2010) 

2004 2005 2006 2007 2008 2009 2010 

Y,ear 

Figures B.1.b and B.1.c illustrate trends in the mean number of annual standards 

starts at each SDO both before and after 2007. For illustrative purposes, values are 

nonnalized to a scale of 1.0 in order to allow comparison of trends at SDOs of different 

SIzes. 

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Page 28 
Ex Ante Standards Study Report 

June 27, 2011 

Figure B.1.b 

Standards Activities Started by Year (2004-07) 

Year 

Figure B.1.c 

Standards Activities Started by Year (2007.10) 

Year 

Page 29 
As illustrated in Figures B.l.b and B.l.c, IEEE experienced a relatively steady 

increase in standards started from 2004 to 2010, with a significantly sharper increase 

from 2007 to 2010 (m=1.32) than 2004 to 2007 (m=0.20). VITA experienced a 

significant net decline in standards starts from 2004 to 2007, and a more modest net 

decline in standards starts from 2007 to 2010, though performance in this later period was 

highly volatile and marked by both a significant increase in 2008, a corresponding 

decrease in 2009, and a modest gain in 2010. Normalized IETF data is presented for 

comparison and suggests that, at least from 2007 to 2010, there was a general industry 

trend toward greater numbers of standards starts (noting an almost identical trajectory for 

IETF and IEEE from 2007 to 20 I 0). 

Based on these data, we do not find a negative correlation between the adoption 

of ex ante policies at VITA and IEEE and the number of standards starts at these SDOs 

over this period. At IEEE, the trend following adoption of its ex ante policy is clearly 

upward, and while we would be hesitant to attribute this result to the adoption of an ex 

ante policy, it is clear that the negative predictions made by critics of ex ante policies did 

not come to pass at IEEE. At VITA, the pattern of standards starts following adoption of 

its ex ante policy is more volatile, but also suggests that the ex ante policy did not have a 

significant impact on the number of standards starts at the organization. In particular, 

dnring the period from 2007 to 2008, immediately after the ex ante policy was adopted, 

while VITA was embroiled in a heated exchange with Motorola over VITA's ANSI reaccreditation,109 VITA saw the highest number of standards starts during the period. Had 

VITA's ex ante policy, or the issues surrounding its adoption, been a significant concern 

to VITA members, one might expect them to defer starting new standardization projects 

within VITA. The result, however, was precisely the opposite. The fact that standards 

starts dropped significantly at VITA in 2009 could have numerous causes (as could the 

increase in standards starts in 2008), but in neither case does the adoption of VITA's ex 

ante policy seem to have been a significant factor. 

2. Standards Approved. Table B.2 shows the number of standards approved 

at each SDO from 2003 to 2010. 

Table B.2 

Number of Standards Approved, by Year (2003-2010) 

normalized to 1.0 

109 See notes 42-43, supra, and accompanying text. 

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Figures B.2.a and B.2.b show the trends in mean number of annual standards 

approvals at each SDO both before and after 2007. For illustrative purposes, values are 

normalized to a scale of 1.0 in order to allow comparison of trends at SDOs of different 

SIzes. 

Ex Ante Standards Study Report 

June 27,2011 

Figure B.2.a 

Standards Approved by Year (2003~07) 

Year 

- - -VITA 

- -IEEE 

- IETF 

Page 31 
Figure B.2.b 

Standards Approved by Year (2007-10) 

- - -VITA 

- -IEEE 

IETF 

Year 

As illustrated in Figures B.2.a and B.2.b, VITA experienced a decline in standards 

adopted from 2003 to 2007 (m=-2.20) and a steep increase from 2007 to 2010 (m=3.81). 

IEEE experienced increases in standards adopted during both periods, but the rate of 

increase after 2007 was siguificantly greater (m03.06=2.72, m07.10=3.47). Thus, it seems 

clear that the adoption of ex ante policies by these SDOs did not result in a decrease in 

the number of standards adopted. 

However, as suggested by the trend line for lETF, there appears to have been a 

general increase in the number of standards approved elsewhere in the industry from 

2007 to 2010, with all three SDOs achieving neartheir maximum approvalleve1 in 2010. 

Thus, while it appears that the adoption of ex ante policies did not cause a decline in the 

number of standards approved by VITA or IEEE from 2007 to 2010, the converse 

conclusion (that the adoption of an ex ante policy contributed to the increase in standards 

approved) cannot reasonably be drawn in view of general industry trends over this period. 

3. Conclusions. Based on the data reviewed, we did not find evidence of a 

causal connection between the adoption of ex ante policies at VITA or IEEE and a 

decrease in either standards activities started or standards approved. Rather, with respect 

to standards starts, VITA experienced a steep increase in the year immediately following 

the adoption of its ex ante policy, followed by an equally steep drop the next year, with 

an overall increase during the period studied, and IEEE experienced a steady upward 

trend throughout the period studied. With respect to standards approved, both VITA and 

IEEE experienced significant increases following adoption of their ex ante policies, 

Ex Ante Standards Study Report 

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which closely tracks overall trends in the industry as exemplified by IETF, suggesting 

that factors other than ex ante policy adoption were largely responsible for effects 

observed. 

C. Length of Standardization Process. 

1. Historical Data. Numerous commentators have noted the lengthy time 

periods required to develop consensus standards in the ICT sector. 11 0 Farrell cites several 

examples from the 1980s and 1990s in which average time requirements for 

standardization at SDOs such as IEEE, IEC and ISO ranged from five to seven years. I I I 

Simcoe measured increases in the time required for standardization at IETF from 1992 

and 2000 and found a 177% increase over the period (from an average of 192 days to 549 

days).112 He explored three possible explanations for this significant increase in 

standardization time: greater technical complexity of IETF standards, growth of the IETF 

organization itself, and a rise in internal conflicts among committees and working groups 

within IETF.113 Interestingly, Simcoe found statistically significant correlations between 

several of these factors and the lengthening of the standardization process at IETF, but 

intellectual property disclosures made at IETF "had no measurable impact on average 

duration of the standard setting process." 114 

Against this backdrop, we measured the number of days elapsed between the 

introduction of a draft standard and approval of the corresponding final standard at VITA, 

IEEE and IETF from 2003 to 2010. The results are surmnarized in Table C.l below. 

110 In most cases, the protracted length of standardization processes is 'Viewed unfavorably. However, some 

commentators have questioned whether a shorter time to standardization is always beneficial. Shah and 

Kesan, for example, observe, based on regression analysis of standardization duration and impact, that 

"there appears to be no relationship between a longer development process and the ultimate impact of a 

standard." Rajiv C. Shah & Jay P. Kesan, An Empirical Examination o/Open Standards Development (U. 

III L. & Econ. Research Papers Series, Research Paper No. LE07-039) at 21 (2007) (available at 

http://papers.ssrn.comlso13/papers.cfm?abstracUd~ 1 031749). Thus, while Shah and Kesan support 

refonns intended to decrease the time required for standardization, they do not feel that such reforms will 

result in standards of higher impact. Froomkin has lauded the IETF's open and participatory processes, 

particularly its enablement of vigorous and substantive multilateral debate; from this perspective, greater 

speed would reduce the deliberative power of such an organization. A. Michael Froomkin, 

Habermas@Discourse.net: Toward a Critical Theory a/Cyberspace, 116 HARV. L. REV. 749, 783 (2003). 

Thus, while market participants may be driven by the desire to standardize products as rapidly as possible, 

it is not uniformly agreed that acceleration ofthe standardization process would increase overall welfare. 

III Joseph Farrell, Choosing the Rules/or Formal Standardization at 7 (working paper, U.C. Berkeley, 

Dept. Economics 1996) (available at 

http://citeseerx.ist.psu.edulviewdoc/download? doi~ 1 0 .1.1. 73.6537 &repoorep 1 &type~pdt). 

112 Simcoe, supra note 86, at 16 (measuring the "elapsed time between publication of the initial and final 

versions of an Internet Draft"). 

113 Id. at 16. 

114Id. at 23. 

Ex Ante Standards Study Report 

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Table C.l 

Average Time (in days) for Standard Approval (2003-2010) 

. ,!, . . "ii 1·.VlT'K.·.'· IE.f"l'lEE ..: IEtE, ., ..... Range 379-1542 1342-1630 694-966 

Std. deviation (G) 371 108 100 

Mean2003_06 979 1525 786 

Mean200710 1298 1498 935 

Slope (m'OO3.07) 33 65 54 

Slop-" (m,007.10) 2 -39 8 

For IETF, these data show a steady increase in the length of time required for 

standardization, from 694 to 925 days, an increase of 33.2%. While this increase is 

substantial, it is far lower than the 177% increase that Simcoe observed at IETF from 

1992-2000. And while the average time for standardization at IETF was higher from 

2007 to 20 I 0 (93 5 days) than from 2003 to 2006 (786 days), the rate of increase (slope 

(m)) decreased from 54 to 8 from the earlier period to the later (a decline of 84%). This 

data suggests that an upward trend for standardization timing may still exist in the leT 

industry, but may not be accelerating as rapidly as it did during the 1990s. 

At IEEE, in contrast, the observed trend is downward. Average time for 

standardization during the period from 2003 to 2006 was 1,525 days, while average time 

during the period from 2007 to 2010 was only 1,498 days (a decrease of 27 days, or 

1.7%). At VITA (a=371), fluctuations from year to year are more pronounced than at 

IETF (a=IOO) and IEEE (a=108) due to the smaller number of standards under 

development at VITA at any given time. And while the average time for approval of 

VITA standards approved from 2007 to 2010 was 1,298 days, as opposed to 979 days for 

the period from 2003 to 2006 (an increase of 33%), the rate of increase declined by 93% 

(m",.",,= 33; m".,"= 2), which is greater than the 84% decline in the rate of increase seen at 

IETF, which has no ex ante policy. Thus it is unlikely that the adoption of VITA's ex 

ante policy can be shown to have caused a lengthening of the standardization process at 

VITA, at least given the data available today. 

This conclusion is consistent with Simcoe's finding that there was no correlation 

between intellectual property disclosures at IETF and lengthening of the standardization 

process. \l5 Rather, it is possible that the continued lengthening of the VITA 

standardization process, which tracks the overall lengthening in the industry, exemplified 

by IETF, may be attributable to the other factors identified by Simcoe, such as growth in 

membership, increasing technical complexity and a rise in internal (non-patent) conflicts 

and competition among participants. 116 One caveat that should be mentioned is that most 

of the standards approved by VITA from 2007 to 2010 were actually started before 

adoption of VITA's ex ante policy. It will be some years before a sufficient quantity of 

liS [d. It should be noted, however, that the disclosures studied by Simcoe were ex ante patent disclosures, 

not ex ante licensing disclosures, making the extension of his findings to the current study imperfect. 

116 Simcoe, supra note 86, at 16. 

Ex Ante Standards Study Report 

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approved VITA standards that were started afier adoption of the ex Glite policy can be 

stndied in detail. 

2. Survey Data - Perceptions. To supplement the historical data discussed 

above, we asked VITA survey respondents to report their perceptions of the effect of the 

adoption of VITA's ex ante policy on the overall speed of standardization at VITA. The 

responses are summarized in Table C.2 below. 

Table C.2 

These responses are notable in that, as discussed above, the mean time for 

standardization at VITA increased following adoption of the ex ante policy. Yet the 

perception of a meaningful fraction of VITA participants (18%) was that standardization 

at VITA actnally became faster after its adoption of the ex ante policy, and only a single 

respondent believed that standardization at VITA had become slower. Moreover, there is 

a significant association (p=O.0004) between experience with VITA and views regarding 

the speed of standardization at VITA: of the group responding that standardization at 

VITA became faster or did not change following adoption of the ex ante policy (n=22), 

46% had at least ten years experience with VITA and 68% had five or more years 

experience with the organization. Conversely, of the respondents who said that they did 

not know or had no basis for comparison, 89% and 91 % respectively had two or fewer 

years experience with VITA. Likewise, there was marginally significant (p=O.0499) 

evidence to suggest that the more SDOs a respondent actively participated in, the more 

likely he or she was to believe that ex ante disclosure of licensing terms makes the 

standardization process at VITA faster than at other SDOs. And among individuals who 

reported that they actnally check ex ante licensing disclosures at VITA (n=22), 77% 

believed that the speed of standardization at VITA was unchanged or became faster at 

VITA after adoption of the ex ante policy, and 73% believed that the speed of 

standardization at VITA was the same or faster than at other SDOS.11 8 

117 The respondent either did not participate in VITA prior to adoption of the ex ante policy in 2007 or does 

not participate in other SDOs, as applicable. 

118 There was a statistically significant correlation between whether one checked ex ante licensing 

disclosures and his or her views regarding both the speed of standardization at VITA before and after 

adoption of the ex ante policy (p=O.0055), and as compared to other SDOs (p=O.0396). Those who 

reported that they did not check disclosures generally seemed to be newer to, and less familiar with, the 

organization, and of those not checking disclosures, 65% (n=13) expressed no opinion regarding the effect 

of the ex ante policy on the comparative speed of standardization at VITA, and 74% (n=14) expressed no 

Ex Ante Standards Study Report 

June 27,2011 

Page 35 
Thus, it appears that among VITA participants having greater experience with the 

organization or SDOs in general, and among participants that are familiar enough with 

the organization's procedures to check for ex ante licensing disclosures, there is a general 

feeling that the adoption of VITA's ex ante policy did not result in a lengthening of the 

standardization process. How can this be reconciled with the observed lengthening of the 

average time to standardization at VITA in the years following adoption of the ex ante 

policy? One possible explanation is that "veteran" participants have observed the 

acceleration of some standardization processes at VITA, or at least portions of those 

processes. The fact that overall standardization time has continued to increase may be 

attributable not to the ex ante policy, but to other factors such as increasing technical 

complexity and length of standards, both of which have been observed by Simcoe in his 

study of IETF.119 If this is the case, then it is not surprising that veteran standards 

developers may have observed a streamlining of certain aspects of the standardization 

process (i.e., those associated with patent and royalty uncertainty) and responded 

accordingly, even while overall standardization time has increased for unrelated reasons. 

3. Response to Disclosures. Critics have predicted that ex ante policies are 

likely to result in multiple rounds of license negotiation between patent holders and 

implementers, thus lengthening the standards development process and delaying approval 

of standards. As discussed in Section IV.G.l below, we have identified only one instance 

in which a disagreement over licensing terms initiated after an ex ante disclosure at VITA 

resulted in the amendment of the proposed license agreement disclosed by the patent 

holder. In addition, as shown in Table G.l below, the actions taken by VITA members in 

response to a disclosed royalty that they deemed "too high" varied in terms of their 

potential to delay standardization by any significant amount. Some actions, such as 

raising the issue at a meeting or contacting the patent holder, have a low potential for 

delay, while others, such as attempting to alter the technical design to avoid the patent 

claims or blocking development or approval pending a resolution of the issue, have a 

greater potential for delay. It is interesting to note, however, that only a fraction of VITA 

respondents (13 %, n~6) indicated that they had taken measures likely to delay 

standardization in response to a royalty disclosure. Most respondents took no action at 

all. While these results are not necessarily dispositive (a single determined participant 

can sometimes delay progress to a disproportionate degree), they do suggest that VITA's 

ex ante policy has not caused a significant number of VITA respondents to engage in 

activity that would be likely to cause material delays in standardization. 

4. Conclusions. Though the data relating to length of the standardization 

process at VITA and IEEE is complex, we do. not believe the data suggests a correlation 

between the adoption of ex ante policies at these organizations and an increase in 

standardization time. At IEEE, standardization time decreased over the period from 

2007-2010. At VITA, based on highly divergent annual averages, standardization time 

opinion regarding the effect of the ex ante policy on the speed of standardization at VITA as compared to 

other SDOs. 

119 Simcoe, supra note 86. We did not measure length or complexity of standards documents nor correlate 

this variable against time to approval. Such an_analysis would be of potential interest for a future study. 

Ex Ante Standards Study Report 

June 27,2011 

Page 36 
increased modestly over this period, but at a slower rate of increase than the immediately 

preceding period (2004-2007) and a slower rate than at IETF. Moreover, more than half 

of VITA survey respondents perceived that standardization speed at VITA had either 

accelerated or remained the same following adoption of the ex ante policy, with such 

responses correlated to the length of the respondent's experience with VITA. Finally, an 

analysis of the actual measures taken by VITA participants in response to ex ante royalty 

disclosures shows that few participated in tactics likely to delay standardization at VITA. 

D. Personal Time Commitment. 

Table D.I shows survey responses relating to changes in VITA respondents' 

personal time spent on standardization activities after the adoption of VITA's ex ante 

policy, both as compared to VITA prior to the adoption of the policy and to other SDOs. 

Table D.l 

Unlike the responses relating to overall speed of standardization at VITA (see 

Section IV.C above), the number of respondents stating that their personal time 

commitments to VITA had changed following adoption of the ex ante policy, either 

positively or negatively, were similar and, in each case, relatively small. Most 

respondents (82% in column (a) and 83% in column (b)), indicated no change in time 

commitment, or that they did not know or lacked a basis for comparison. As with overall 

speed of standardization, however, there was a strong statistical correlation (p=0.0002) 

between responses and experience with VITA: of the group responding that their personal 

time commitment to VITA decreased following adoption of the ex ante policy (n=5), 

80% had five or more years experience with the organization and of those who responded 

that their personal time commitment to VITA did not change (n=14), 50% had ten or 

more years experience with VITA and 71 % had five or more years experience with the 

organization. 

To investigate the extent to which changes in personal time commitment might be 

attributable to the adoption of VITA's ex ante policy, we also asked respondents a 

120 The respondent either did not participate in VITA prior to adoption of the ex ante policy in 2007 or does 

not participate in other SDOs, as applicable. 

Ex Ante Standards Study Report 

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Page 37 
number of questions intended to assess the level of new activity required by the policy. 

First, we asked whether participants checked ex ante licensing disclosures when a new 

standard is proposed at VITA, J2l on the ground that those who did not check disclosures 

would be unlikely to have increased activity as a result of such disclosures. 51 % (n=23) 

of respondents said that they checked such licensing disclosures, and 57% of those 

responding positively (n= 13) said they checked either "always" or "frequently". It is 

among this group that we would expect to see increased time commitments associated 

with VITA. Yet of those VITA participants who said they checked licensing disclosures 

"always" or "frequently", only one (8%) said that he or she was required to spend more 

time on VITA following the adoption of its ex ante policy, and 67% (n=8) said that they 

devoted the same or less time to VITA standards activities. 122 

Thus, as with overall standardization speed, among VITA participants having 

greater experience with the organization or SDOs in general, and among participants that 

are familiar enough with the organization's procedures to check for ex ante licensing 

disclosures, there appears to be a general sense that the adoption of VITA's ex ante 

policy did not result in an increased individual time commitment. 

E. Membership. 

1. VITA Membership Fluctuations, 2004-2010. Table E.I below shows the 

year-over-year membership changes in VITA from 2004 to 2010, based on the 

methodology described in Section III.B.3.e above: 

Table E.1 

Changes in VITA Membership (2004 to 2010) 

121 In a separate question, we also asked whether respondents checked patent disclosures. Responses were 

comparable as to these two questions. . 

112 In general, we found a statistically significant correlation (p=O.0339) between whether one checked ex 

ante licensing disclosures and the impact on his or her time commitment to VITA. Those who reported that 

they did not check disclosures generally seemed to be newer to, and less familiar with, the organization, 

and 74% (n=14) ofthase not checking expressed no opinion regarding the effect of the ex ante policy on 

their individual time commitment to the organization. 

Ex Ante Standards Study Report 

June 27,2011 

Page 38 
VITA adopted its ex ante policy in January 2007. In that year, VITA gained eight 

new members and lost 16 members, resulting in a net loss of eight members. 

Membership remained relatively stable in 2008 and 2009, with a significant increase (a 

net gain of 21 members) in 2010. 123 Thus, over the period from 2007 to 2010, VITA saw 

a significant net increase in members, and if any membership decline was caused by the 

adoption of VITA's ex ante policy, it would have been the short-term net loss of 

members in 2007. However, the evidence discussed below suggests that the ex ante 

policy did not result even in the 2007 net membership decline experienced by VITA. 

2. Little Public Opposition to VITA ex ante Policy. Of the 16 members who 

left VITA in 2007, only one (Motorola) publicly opposed VITA's ex ante policy. The 

VITA VSO membership approved the VITA ex ante policy in January 2007 by a vote of 

35-2 with 12 abstentions]24 Presumably, a member that voted in favor of the policy 

would not have withdrawn from the organization due to the adoption of the policy. 

Thus, while it is clear that the ex ante policy was a major factor in Motorola's resignation 

from the organization,125 we found no evidence that any other VITA member publicly 

opposed the adoption of the ex ante policy. 

3. General Membership Fluctuations at VITA. Of the 16 members that 

withdrew from VITA in 2007, at least four rejoined the organization in a subsequent year. 

This effect is not unusual, as VITA membership fluctuates significantly from year to year 

as work on standards of interest to particular members is commenced or concluded. 

Other departures annually are due to changing business priorities, failure of smaller firms, 

and acquisitions by non-members. Based on information gathered during an interview 

with VITA's executive director, each 2007 departure other than Motorola's can be 

attributed to one of these other causes. As shown in Table E.1 , VITA experienced an 

average loss of 14.3 members per year between 2004 and 2010 (offset by an average 

annual gain of 21.2 members, for an average net gain of6.8 members). Thus, the loss of 

16 members in 2007 is only slightly above VITA's average annual membership loss]26 

123 There is no indication that VITA membership has dropped significantly as of May 22, 2011. 

124 The vote was taken at a meeting of the VSO held in Long Beach, California at which there were 51 

eligible voting representatives. See Letter to VSO Attendees dated Nov. 16, 2006 (available at 

htlp:/lwww.vita.comldisclosure/vso-voting-ex-ante.pdt). Note that only VITA members that are active in 

VSO standardization activities are eligible to vote on VSO matters. 

125 See notes 42-43, supra, and accompanying text. It has been reported that after withdrawing from VITA, 

Motorola sold the division that had participated in VITA to Emerson, another non-member. Lindsay, supra 

note 24, at 7, n.22. 

126 VITA's membership ranges from very large, multinational enterprises to small businesses. VITA's 

current members include, for example, large enterprises and patent holders such as General Electric, 

Agilent Technologies, BAE Systems, Boeing, General Dynamics, MIT Lincoln Laboratories, Tyeo 

Electronics and Xylinx. While we did not attempt to weight VITA membership departures and additions 

by size, patent holdings or any other factor, we did not notice any significant trend toward larger or smaller 

members departing or joining VITA during the period studied. In future studies, it might be desirable to 

investigate whether any connection exists between departing or joining an SOO based on size of the 

company and/or the standards-relevant patent portfolio. 

Ex Ante Standards Study Report 

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Page 39 
4. Comparison to IETF Attendance. Figures E.4.a and E.4.b below enable a 

comparison of the trends in VITA's membership versus IETF's North American meeting 

attendance over the period from 2004 to 2010. 

45 

40 

35 

30 

25 

20 

15 

10 

5 

2004 2005 

Ex Ante Standards Study Report 

June 27, 2011 

Figure E.4.a 

VITA Membership Changes by Year 

2006 2007 2008 2009 2010 

Year 

Page 40 
Figure E.4.b 

IETF N. American Attendance Changes by Year (2004 Baseline) 

2004 2005 2006 2007 2008 2009 2010 

Year 

As shown in Figures E.4.a and EA.b, beginning in 2005, the general trend in IETF 

attendance tracks VITA membership changes over the same period. Like VITA, IETF 

experienced a material increase in attendance in 2006, a drop in attendance in 2007, 

relatively steady attendance in 2008 and 2009, and an increase in 2010. While it is 

difficult to draw precise comparisons between VITA membership and IETF attendance, it 

is informative that the general participation trends in both organizations are comparable 

over most of the period studied, further suggesting that the membership drop experienced 

by VITA in 2007 may have been attributable to general industry conditions rather than its 

adoption of an ex ante policy. 

5. Survey Data. We surveyed VITA participants regarding their employers' 

reactions to VITA's adoption of an ex ante policy. 74% of respondents (n~3l) stated that 

their employer did not consider withdrawing from VITA as a result of its adoption of an 

ex ante policy, and only 7% (n~3) said their employer did consider withdrawing127 (19% 

did not know). Moreover, when respondents were asked, all other things being equal, 

whether they would recommend that their employer join another SDO with an ex ante 

policy similar to VITA's, 56% (n~23) said they would either strongly or moderately 

recommend such an action, 44% said they would neither recommend nor discourage such 

127 There is a significant association (p=O.0027) between reporting that a participant's employer had 

previously submitted a patent disclosure to an SDO and that employer's consideration of withdrawal from 

VITA as a result of the adoption of its ex ante policy. However, due to the small number of respondents 

reporting that their employers had considered withdrawing from VITA (n=3), -no conclusions about trend 

can be drawn from this sample. 

Ex Ante Standards Study Report 

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Page 41 
an action and none said that they would discourage it. Based on these responses, it is 

reasonable to conclude that VITA's ex ante policy is supported by its current membership 

and had little effect on VITA membership beyond the known opposition and withdrawal 

of Motorola. We acknowledge, however, that a sampling bias may be present with 

respect to these responses, as any members who withdrew from the organization based on 

dissatisfaction with the ex ante policy would not be part of the pool of current VITA 

members suryeyed. 128 

6. Conclusions. VITA membership has increased since the adoption of its ex 

ante policy in 2007, despite a slightly above-average net decrease in members that year. 

The data we reviewed does not suggest that the adoption of VITA's ex ante policy caused 

the departure of more than one member from VITA. Overall, VITA's membership trends 

from 2005 to 20 I 0 have tracked closely with industry averages as exemplified by IETF. 

F. Quality of Standards. 

Measuring the "quality" of technical standards is inherently difficult, imprecise 

and subjective. Thus, in order to make an assessment of the change in quality, if any, of 

standards following the adoption of ex ante policies, we measured three different 

variables: quality perceptions by VITA participants, external recognition of VITA 

standards and impact based on citation data derived from search engine hits. 129 

1. Survey Data. We surveyed VITA members to determine their views 

regarding the effect, if any, that the adoption of VITA's ex ante policy had on their 

perceptions of the quality of VITA standards. As shown in Table F.l, 79% of respondents 

felt that adoption of VITA's ex ante policy improved the quality of VITA standards. 

Moreover, among participants having ten or more years of experience with VITA (n=II), 

90% responded that adoption of VITA's ex ante policy made the quality of VITA 

standards "much better" or "somewhat better". 

128 To this end, it has been suggested that a fruitful avenue for future research may be the polling offonner 

VITA members. 

129 Other methods of assessing. the impact of standards have been proposed. For example, Rysman and 

Simcoe have suggested that SOO performance can be measured by the number of patent documents citing 

patents disclosed to the SOO. Marc Rysman & Tim Simcoe, Patents and the Peiformance of Voluntary 

Standard Setting Organizations, 54 MANAGEMENT SCI. 1920 (2008) (studying patent disclosures made at 

IEEE, IETF, the European Telecommunications Standards Institute (ETSI) and the International 

Telecommunications Union (lTU)). We elected not to.use this approach, as it does not address the impact 

of standards as to which no patent disclosures have been made. 

Ex Ante Standards Study Report 

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Page 42 
Table F.l 

We acknowledge, of course, that the responses of VITA participants with 

significant personal investments of time and effort in VITA standards development may 

reflect personal bias regarding the quality of VITA standards. Thus, future studies may 

benefit from obtaining views of more impartial observers in assessing the perceived 

quality of SDO standards. 

2. External Recognition. External accolades and awards can also serve as 

measures of a standard's quality. One prominent electronics industry award is made by 

Electronic Design magazine, which each year chooses products and designs for its "Best 

Electronic Design" awards in numerous categories. In 2009, VITA Standards 66 and 

6i 30 were awarded Best Electronic Design awards in the Military & Aerospace 

category,131 and in 2010, VITA Standard 65 eVPX System Specifications and 

Practices") received the same award. 132 Prior to 2009, VITA had not won any significant 

industry awards. This recognition, and the development of the recognized standards, 

.occurred after the adoption of VITA's ex ante policy, and evidences recent industry 

recognition of VITA's standards. Patent disclosures have not been made with respect to 

any of the recognized standards. Thus, while such industry awards to some degree 

validate the quality of VITA's technical program, a link with the ex ante policy is 

difficult to establish. At a minimum, the fact that VITA standards have won recent 

industry awards does tend to refute arguments that overall technical quality at an SDO 

adopting an ex ante policy will invariably suffer. 

3. Citation Data. One method suggested by Shah and Kesan for assessing 

the relative valne a technical standard is comparing the number of "hits" returned by 

130 Interestingly, neither of these standards had been formally approved by VITA at the time the award was 

made, and still had not been approved by May 2011. Nevel1heless, products implementing these draft 

standards existed in the market and were viewed by the editors as sufficiently innovative to merit an award. 

131 Electronic Design Press Release, Electronic Design Announces 2009 Best Electronic Design Awards, 

Jan. 9, 2010 (available at 

http://electronicdesign.comlartic1e/services/electronic _design_announces _ 2009 _best_electronic_design _ aw 

ard _ winners _.aspx)~ 

132 VITA Press Release, OpenVPX Wins Electronic Design's Best Electronic Design Award, Dec. 10,2010 

(available at http://www.vita.comlnewsNITA-NR-2010-

12%200pen VPX%20Wins%20Best%20Electronic%20Design%20A ward. pdf) . 

Ex Ante Standards Study RepOlt 

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Page 43 
Internet search engines based on key words identifying one standard versus anotherl3J 

Google hits may serve as indicators of a standard's "impact," as they reflect the number 

of articles referencing the standard, products that advertise compliance with the standard 

and discussions of the standard in technical groupsB4 While search engines such as 

Google invariably return results that are spurious in addition to those that are relevant, a 

comparison of hit ratios for different standards can shed light on the relative impact of 

such standards, the absolute number of hits being less infonnative. 

Figure F.2 below is a plot of the thirty-four VITA standards adopted between 

2003 and 2010 against the number of Google hits returned for each such standard, using 

the search methodology described in Section IlI.B.3.f above. 

Figure F.2 

Google Hits on VITA Adopted Standards (2003 to 2010) 

Date of Adoption o = Patent Declaration 

133 Rajiv C. Shah & Jay P. Kesan, Open Standards and the Role a/Politics, PRoe. 8111 ANN. INTL. DIGITAL 

GOVT. RESEARCH CONF. (2007) (finding that Google hits were "the best indicator of the impact of an open 

standard"). Google hits have also been used in various other fields to assess impact. See, e.g., James P. 

Bagrow & Daniel ben-Avraham, On the Google-Fame of Scientists and Other Populations, 779 AlP CONF. 

PROC.: MODELING COOPERATIVE BEHAVIOR TN THE SOCIAL SClENCES 81 (2005), Preslav Nakov & Marti 

Hearst, A Study of Using Search Engine Page Hits as a Proxy for n-gram Frequencies, PROCEEDINGS: 

RECENT ADVANCES TN NATURAL LANGUAGE PROCESSTNG (2005) and Su Cheng, et aI., PageRank. HITS 

and Impact Factor for lournal Ranking, 6 COMPo SCI. & INFO. ENG. 285 (2009). Shah and Kesan have also 

utilized hits from Yahoo! and Google Scholar, citations in other standards and patent citations in assessing 

the impact of open standards. Shah & Kesan, supra note 110, at 7-9. 

134 It is not certain, of course, whether such discussions are favorable or unfavorable to the standard, and 

standards that are heavily criticized could garner as many or more hits than standards that are uniformly 

praised. 

Ex Ante Standards Study Report 

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Page 44 
Range: <100 to 81,300 

The number of hits per standard ranged from 81,300 hits for VITA 42.0 "XMC" 

to fewer than 1 00 hits for several standards. 135 The average number of hits for a VITA 

standard in this sample was 11,184, with standard deviation (after logarithmic 

transformation) of 2.06. The data are not markedly different if the time period examined 

is split at the point that VITA's ex ante policy was adopted in January 2007. Thus, the 

average number of hits for the thirteen VITA standards approved prior to January 2007 

was 12,856, and the average number of hits for the twenty-one VITA standards approved 

after January 2007 was 10,149. 136 Moreover, the number of standards in each sub-period 

that exceeded the average number of hits for the full period was nearly identical: 3 of 13 

(23.1 %) for pre-2007 standards and 5 of 21 (23.8%) for post-2007 standards. Thus, it 

appears that the adoption of VITA's ex ante policy, per se, did not have a discernable 

impact on the number of hits per VITA standard. 

We also examined the number of hits associated with approved VITA standards 

as to which ex ante licensing disclosures had been made. These standards are noted in 

Figure F.l. Among the twenty-one VITA standards aprroved from 2007 to 2010, the 

standards as to which disclosures were made ranked 4t ,8th, 11th and 15th in terms of 

Goog1e hits, a relatively even distribution suggesting that the presence of ex ante 

licensing disclosures did not have a material effect on these standards' impact. 

4. Conclusions. A significant majority of survey respondents, and nearly all 

respondents having 10 or more years experience with VITA, believed that the adoption of 

the ex ante policy improved the overall quality of VITA standards. VITA standards 

garnered two external industry awards after 2007. Finally, based on an analysis of search 

engine hits on VITA standards approved since 2004, we did not detect significant 

differences between the impact of VITA standards before and after adoption of the ex 

ante policy. Thus, we do not find evidence that the quality of VITA standards 

deteriorated following adoption of its ex ante policy, and find some evidence suggesting 

that quality improved. 

135 Interestingly, contrary to common intuition, older standards did not consistently yield more hits than 

newer standards. In fact, VITA 42.0, which received 81,300 hits, was approved in 2008, while VITA 1.0-

1994 "VME64", which was approved in 1994, received only slightly more, at 88,500. Moreover, the fact 

that several VITA standards with approval dates ranging from 2005 to 2010 yielded fewer than 100 hits 

suggests both that very low hit rates are not caused simply by the recentness of a standard's approval and, 

more importantly, that Google is not returning large quantities of spurious results in response to search 

queries for these standards. 

The distribution of the present data set is consistent with the power law distribution that Shah and 

Kesan observed in a study of 634 IETF standards approved between 2000 and 2003. Shah & Kesan, supra 

note 110, at 2. In Shah's and Kesan's study, 20% of Google hits were attributable to the 0.9% highestranking standards, and 80% of Google hits were attributable to the 17.5% highest-ranking standards. In our 

VITA data set, 20% of Google hits were attributable to the single highest-ranking standard (2.9% of the 

total sample), and 80% of Go ogle hits were attributable to the 20.6% highest-ranking standards. 

136 The standard deviation of the pre-ex ante logarithmic data set is 2.21, whereas the standard deviation for 

the post-ex ante data set is 2.03, indicating that the post-2007 data set, perhaps because of its larger size, is 

somewhat more stable than the earlier data set. 

Ex Ante Standards Study Report 

June 27,2011 

Page 45 
G. Effect on RoyaltyRates. 

Critics have predicted that ex ante policies will enable implementers of standards, 

either expressly Or implicitly, to apply inappropriate pressure to patent holders to lower 

their royalty rates below fair or reasonable levels, and in some cases all the way to 

zero. 137 While we did not have access to information regarding the royalties charged by 

patent holders to individual licensees, we can make several observations regarding this 

prediction based on the data that we collected. 

1. Royalty-Free Disclosures. If ex ante policies are likely to result in 

depressed or zero patent royalties, then one might expect to see more disclosures of 

royalty-free (RF) licensing terms at SDOs adopting such policies than at SDOs not 

adopting such policies. Interestingly, our data reveal the opposite effect. As shown in 

Table G.l below, from 2007 t.o 2010, at VITA there was only one ex ante disclosure of 

royalty-free licensing terms (14% .of all disclosures), while at IEEE there were 11 (84%) 

and at IETF there were 283 (100%). 

Table G.1 

Disclosures 

The royalty-free disclosures made at IEEE and IETF were not mandated by a 

formal SDO policy, and there are various other explanations for the prevalence of 

royalty-free licensing, particularly in view of stated preferences at IETF.138 Likewise, 

VITA's ex ante requirement to disclose maximum royalty rates does not appear to have 

subjected patent holders to inordinate pressure to license their patents for too little, or for 

free. If such pressure existed, then even if a patent holder initially disclosed a reasonable 

royalty rate, one might expect it subsequently to revise its royalty disclosure to reflect a 

lower rate more to the liking of implementers. At VITA, however, we have identified 

only one instance in which a disagreement over licensing terms initiated after an ex ante 

disclosure resulted in the amendment of the license disclosure made by the patent holder. 

Interestingly, that disagreement involved not royalties, but the scope of a "defensive 

suspension" provision. 139 Thus, there have to date been no downward adjustments to 

royalty rates disclosed under the VITA ex ante policy. 

137 See, e.g., 2007 DOl/FTC Report, supra note 14, at 52; Herman, supra note 11, at 38 ('1hrough 

coordinated action, the prospective licensees will pressure the patentee to forgo royalties or fees 

altogether"). 

138 See IETF RFC 3979, supra note 74, at §8 ("In general, IETF working groups prefer technologies with 

no known IPR claims or, for technologies with claims against them, an offer ofroyalty-ffee licensing.") 

l39 A "defensive suspension" clause allows the patent holder to suspend or tenninate a license grant if the 

licensee takes some specified action, typically bringing suit against the licensor. See ABA Manual, supra 

Ex Ante Standards Study Report 

June 27, 2011 

Page 46 
Admittedly, the maximum royalty rates disclosed under an SDO's ex ante policy 

are not necessarily indicative of the actual royalty rates agreed by patent holders and 

implementers in bilateral license agreements, Moreover, we have no way to determine 

whether the initial royalty rates disclosed by patent holders under VITA's ex ante policy 

are justified or artificially depressed due to pressure from implementers. Thus, while the 

data noted above do not point to inappropriate pressure to depress patent royalty rates, 

they do not shed light on whether or not such royalty reductions occurred in fact. 

2. Survey Responses reo Royalty Disclosures. We asked VITA members 

what actions they took in response to ex ante royalty disclosures when they felt that the 

disclosed royalty was "too high". 33% (n=13) of respondents felt that, at on at least one 

occasion, a royalty rate disclosed at VITA was too high. The actions taken by these 

respondents as a result of such disclosures are summarized in Table 0.2 below. 

Table C.2 

Delayed/stopped development pending 

Unlike most of our survey questions, this one was open-ended in that respondents 

were asked to compose an answer without selecting from a list of pre-determined choices. 

We believe it is significant that, given this flexibility, only one respondent explicitly 

stated that he or she had attempted to negotiate the royalty rate with the patent holder. 

One other respondent who stated that he/she had "contacted" the patent holder can also 

be assumed to have done so in order to negotiate a royalty rate. Bilateral discussions of 

royalty rates are normal in the standards development context and are, in fact, encouraged 

by critics of ex ante policies as the optimal method of setting royalty rates. 140 Other 

responses, such as attempting to design around the patent or postponing further 

note 8, at 62-67. Lindsay describes the episode as follows based on a 2009 interview with VITA's 

executive director: 

"The company had included what other members of the group evidently considered an 

overly broad "defensive termination" provision. After reading the provision, 

representatives of those other member companies discussed the issue with the patentholder. When that did not resolve the difference, the member companies filed formal 

complaints with VITA, saying the provisions were neither fair nor reasonable. VITA and 

its counsel discussed the matter with the patent-holder, who reconsidered its position and 

removed the clause." 

Lindsay, supra note 24, at 8. 

140 See Hennan, supra note 11, at 39. 

Ex Ante Standards Study Report 

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Page 47 
development pending resolution of the issue, might at best put indirect pressure on the 

patent holder to lower its royalty offer, though this form of pressure is simply the sort of 

cost -based competition that was encouraged by the DOJ when it analyzed the VITA and 

IEEE ex ante policies. l4l Thus, while there are inherent limitations on survey data in this 

context (i.e., few paJ1icipants would likely admit that they engaged in unlawful collusion 

to pressure patent holders to depress royalties), it is informative that the VITA 

participants who responded to this question reported taking a range of appropriate and 

lawful actions in response to ex ante royalty disclosures that they felt were excessive. 

3. Conclusion. Some of the data we analyzed suggests that ex ante policies 

have not led to a depression of royalty rates, and we found no evidence that affirmatively 

supports such a causal association. However, due to inherent limitations of the royalty 

data available to us, this result remains inconclusive and a desirable subject for further 

research. 

141 See 2007 DOJ/FTC Report, supra note 14, at 52-53 ("Ex ante licensing discussions may lead to price 

competition, in effect allowing for broader competition among alternative technologies vying for inclusion 

in the standard ... Ex ante licensing discussions can thus preserve the benefits of competition that exist by 

increasing the e.x ante knowledge of SSO decision-makers about licensing terms and may improve the 

quality of their decisions, enabling them to make tradeoffs between price and technical merit ... "). 

Ex Ante Standards Study Report 

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Page 48 
V. Conclusions 

A. Summary of Findings. 

As described above, we reviewed a variety of empirical data within the 

framework of six predictions made by critics of ex ante licensing disclosure policies. 

These predictions, and our observations, are briefly summarized below: 

I. Assertion: Ex ante policies will reduce standardization activity. 

Observation: We observed increases in both new standards activity and 

standards approved at both VITA and IEEE following adoption of their ex 

ante policies. 

2. Assertion: Ex ante policies will cause standards to take longer to develop. 

Observation: Standardization time measurably decreased at IEEE 

following adoption of its ex ante policy. Standardization time at VITA 

increased, but at a slower rate than prior to policy adoption, and in a 

manner consistent with broader industry behavior exemplified by IETF. 

Perceptions among a significant number of VITA standards developers, 

particularly those having greater experience with the organization, was 

that standardization time had either decreased or remained constant 

following adoption of the ex ante policy. 

3. Assertion: Ex ante policies will require standards developers to devote 

more time to standardization activities. 

Observation: Among VITA participants having greater experience with 

the organization or SDOs in general, and among participants who checked 

for ex ante licensing disclosures, there was a general sense that the 

adoption of VITA's ex ante policy did not result in an increased individual 

time commitment. 

4. Assertion: Ex ante policies will cause members to withdraw from SDOs 

that adopt them. 

Observation: Overall VITA membership has increased since the 

adoption of its ex ante policy in 2007, despite material year-to-year 

fluctuations in membership. We did not find evidence suggesting that 

more than one VITA member resigned from the organization as a result of 

the adoption of VITA's ex ante policy. 

5. Assertion: Ex ante policies will cause standards to decrease in quality. 

Ex Ante Standards Study Report 

June 27, 2011 

Page 49 
Observation: We did not find evidence that the quality of VITA standards 

deteriorated following adoption of its ex ante policy, and found some 

evidence suggesting that quality improved. 

6. Assertion: Ex ante policies will depress patent royalty rates. 

Observations: We found no evidence that affirmatively supports such an 

association. However, due to inherent limitations of the royalty data 

available to us, this result remains inconclusive and a desirable subject for 

further research. 

B. Limitations and Generalizability of Findings. 

Many of the findings in this study are based on analyses of data supplied by 

VITA, a relatively small organization. It has been suggested in the literature that VITA's 

positive experience with ex ante licensing disclosures has been atypical, and that the 

perceived benefits of ex ante disclosures to VITA might not translate to larger SDOs with 

greater numbers of standards, patents and participants. I42 While we also analyzed 

publicly-available data from IEEE, a much larger SDO, our ability to obtain information 

from IEEE was limited and IEEE declined our request to permit us to survey its 

members. Thus, our analysis of IEEE was not as complete as our analysis of VITA. 

Moreover, our analysis of survey responses by VITA participants was limited by the 

survey response rate (53.4%) and margin of error (9.8%). In year-to-year comparisons of 

data relating to standards starts, standards approved and membership levels, time-varying 

factors that were not observed may have had a significant effect, and relationships 

between the variables studied may have been distorted by confounding factors that we 

were not able to control for. 

Despite these limitations, we believe that the analyses and conclusions in this 

study are generalizable to other standardization activities in the ICT industry. First, 

VITA's membership ranges from large, multi-national corporations with significant 

patent portfolios to small businesses. I43 Thus, while VITA's overall membership may be 

smaller than that of other SDOs; we believe that it is generally representative of the range 

of businesses that participate in ICT standardization. Second, as shown by the data in 

Tables A.I, B.I, B.2 and C.1, VITA's standardization projects, while fewer in number 

than those conducted at IEEE and IETF, share many characteristics with projects 

conducted at these larger organizations. In particular, the ratio of patent disclosures filed 

to approved standards at VITA, IEEE and IETF are comparable. Thus, the fact that 

VITA may approve five standards in a year rather than 50 or 500 does not necessarily 

imply that the five standards activities at VITA differ materially in scope, complexity, 

patent coverage or value from any five given standards activities conducted at larger 

SDOs. For these reasons, we believe that the conclusions drawn based on data collected 

142 See TAPIA, supra note 24, at 178-79 (describing the reasoning of ex ante critics who sought to 

differentiate VITA from larger, more complex organizations such as ETSI). 

143 See note 126, supra. 

Ex Ante Standards Study Report 

June 27, 2011 

Page 50 
from VITA has applicability to other standardization activities in the leT sector and 

should infonn the discussion of ex ante disclosure policies in general. 

C. Conclusion 

In general, we did not find that ex ante disclosure policies resulted in measurable 

negative effects on the number of standards started or adopted, personal time 

commitments or quality of standards, nor was there compelling evidence that ex ante 

policies caused the lengthening of time required for standardization or the depression of 

royalty rates. There was also evidence to suggest that the adoption of ex ante policies 

may have contributed to positive effects observed on some of these variables. In 

addition, a significant majority of VITA participants responding to our survey felt that the 

infonnation elicited by the organization's ex ante policy was important and improved the 

overall openness and transparency of the standards-development process. Thus, while 

there are numerous areas in which further study and analysis may be warranted, and other 

organizations in which the implementation of ex ante policies may have different effects, 

we conclude, on the basis of the data that we have reviewed, that the process-based 

criticisms of ex ante policies described above, and the predicted negative effects flowing 

from the adoption of such polices, are not supported by the evidence reviewed. 

Ex Ante Standards Study Report 

June 27, 2011 

Page 51 
DATA APPENDICES 

A. Demographic Characteristics of VITA Survey Respondents 

Table S.A.l 

Customer \illClUmrlg governmeut 

Ex Ante Standards Study Report 

June 27,2011 

TableS.A.2 

Table S.A.3 

Table S.A.4 

Tenure with VITA 

19% 

Page 52 
Table S,A's 

Patent Experience 

None 57% 

1-5 32% 

More than 5 11% 

B, Ex Ante Disclosures 

Table S,B,1 

t Includes patent applications 

§ Researchers have agreed not to disclose specific royalty rates or companies making 

disclosures, per agreement with VITA. 

C. Time to Standardization 

Ex Ante Standards Study Report 

June 27, 2011 

Table S.C.1 

Page 53 
D. Standards Activity 

Ex Ante Standards Study Report 

June 27, 2011 

Table S.D.1 

Table S.D.2 

Page 54 
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