The missing link between technological standards and value-chain governance: the case of patent-distribution strategies in the mobile-communication industry

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In this paper we explore the effects of technological standards on the governance structure of production networks by investigating patent-distribution strategies in the global mobile-communication industry. Through a comparative analysis of two mobile-communication technology standards—GSM and CDMA—we find that there exist significantly different patent-distribution strategies which result in varied governance structure as well as power relations within seemingly similar production networks. Furthermore, the different social–institutional processes of standard setting and implementation of GSM and CDMA contribute to this varied governance structure to a significant degree. Thus, we highlight the role of patent-distribution strategies in influencing value-chain governance, and provide a dynamic view of technological standards.