ITU-T Kaleidoscope 2010 Beyond the Internet? - Innovations for future networks and services

1. Competition and Cooperation in the formation of Information Technology Interoperability Standards: A Process Model of Web Services Core Standards ITU-T Kaleidoscope 2010Beyond the Internet? - Innovations for future networks and services Dr. Jai Ganesh Infosys Technologies Ltd. Jai_ganesh01@infosys.com

2. Contents • Introduction • Motivation, Research Objective • Literature Survey • Standardisation, Open Standards, IT interoperability, Process Theory, Web services, Standard Bodies • Research Methodology • Process Model • Conclusion

3. Introduction • Standards formation is a key dimension in the competitive strategy of ICT firms • modularization and network externalities • favorable IT interoperability standards • We examine the standardization efforts of core Web services standards • develop an empirically grounded process model of standardization processes of three inter-related core Web services standards

4. Motivation • Web services standards involve • competitive and cooperative standards formation strategies exhibited by dominant firms in the ICT industry, • the standards are inter-related and were formed almost in parallel, • private and public participation, including informal groups such as COP, • involvement of multiple standard setting bodies reflecting the dynamics of institutionalization

5. Research Objective • Understand the competitive as well as cooperative behavior of dominant firms in the process of standards setting • Large scale adoption of three core interoperability standards • UDDI, SOAP, WSDL • ICT interoperability fosters innovation by reducing lock-in effects, lowers entry barriers, enhances user choice, and growth of diverse applications

6. Open Standards • Open Standards are standards made available to the general public and are developed (or approved) and maintained via a collaborative and consensus driven process • ITU-T

7. Standard Bodies: W3C and OASIS World Wide Web Consortium (W3C): SOAP, XML, WSDL W3C focuses on basic specifications right from HTML and HTTP W3C’s standards are applauded for their robustness Standards setting process may run to two to three years. The slow pace may not find takers in fast moving technology businesses. The Organization for the Advancement of Structured Information Standards (OASIS), UDDI OASIS focuses on developing higher level standards Standards formation timelines for OASIS are much shorter OASIS has been criticized for the lower degree of usefulness and quality of its standards

8. Research Methodology: Data Sources • Data sources for our methodology were • technical notes of standard bodies (OASIS, W3C, IETF etc.), • research forums (IBMDeveloperworks etc.) • analyst reports (Zapthink, Forrester and Gartner), • books (Professional XML Web services) and • practitioner journals (Dr. Dobb’s Journal) • archives of developer discussions

9. Research Methodology: Unit of Analysis Service Broker Registry Publish (WSDL) Discover (UDDI) Service Provider Service Requestor Invocation (SOAP) The unit of analysis was a particular standard i.e. SOAP, UDDI and WSDL

10. WSDL • Web Services Description language (WSDL) defines a standard description mechanism for Web services • A WSDL document describes what functionality a Web service offers, how it communicates and where it is accessible. • WSDL 1.0 was developed by IBM, Microsoft and Ariba • WSDL 1.1 was published in March 2001 WSDL 2.0 became a W3C recommendation on June 2007

11. SOAP • Simple Object Access Protocol (SOAP) is a XML based lightweight protocol for exchange of information in a decentralized, distributed environment • SOAP defines a mechanism for expressing application semantics by providing a modular packaging model • SOAP was developed by Microsoft • SOAP Version 1.2 became a W3C recommendation on June 24, 2003

12. UDDI • Universal Description, Discovery and Integration (UDDI) is a platform-independent registry for businesses to list their web services on the Internet • Discovery mechanism for Web services. • UDDI uses WSDL to describe the interfaces • IBM, Microsoft, Ariba and 33 other companies team up to develop UDDI specs in 2000 • Public UDDIs did not find industry support and in 2006, IBM, Microsoft, and SAP closed their public UDDI nodes

13. Process Theory • Process theories focus on sequences of activities to explain how and why particular outcomes evolve over time • Mohr, L. B. [1982]; Shaw, et al. [1997] • Process theories are easier to understand and are high in relevance • Shaw, and Jarvenpaa, [1997]

14. Research Methodology: Analysis • We explored antecedent conditions, encounters, episodes, and outcomes during standards formation • Newman, M. & Robey, D. [1992] • Each standard was analyzed by first preparing a visual process map of sequence of events • Events, activities and decisions were categorized and the time dimension of progression was also captured minutely

15. Timeline of the 3 Standards

16. Process Model • Standardization processes unfold as a dynamic interplay of five activities: • resource pooling formulated by the involved firms, • creation of linkages with communities of practice and standard institutions, • signaling and implementation experiments • institutionalization and preservation of proprietary control • extension

17. Process Model

18. Resource Pooling • Firms were pooling resources to build Web services architecture stacks • IBM co-developed the SOAP/UDDI stack with Microsoft, Ariba, etc. • IBM was leveraging the horizontal capabilities ingrained in its software divisions to ensure a unified approach • Microsoft formulated its entire Internet strategy around SOAP • Resource pooling from smaller firms such as Ariba, DevelopMentor, Userland etc.

19. Linkages • Linkage functions include • promotion and dissemination of artifact logic, dissemination of specification, collaboration with other standard setting bodies, communities of practice etc. • Critical for the dominant players such as IBM and Microsoft to create strong linkages with the ecosystem partners

20. Linkages Contd….

21. Signaling & Implementation • Signaling is a mechanism available to convey the degree of commitment towards the standardization process • Announcements about potential new products/platforms, extensions of existing product/platforms, product/platform support for the standard etc. • Implementations are in the form of reference implementations which are representative of actual usage scenarios.

22. Signaling & Implementation Contd… • Microsoft was aggressive in incorporating SOAP into its offerings • HP came out with its Web Services Platform, which supported UDDI, WSDL, SOAP and ebXML • Other key players such as Sybase, TIBCO, Vitria, Borland, Mercury Interactive and smaller players such as Cape Clear, IONA, Flamenco, etc. started supporting the basic Web services standards

23. Institutionalisation • Firms create and maintain institutionalisation through industry councils, technical committees, and trade associations • Industry associations educate, and negotiate with other institutions and governmental units • Institutionalisation can be seen in the case of UDDI, wherein four companies (IBM, Microsoft, NTT and SAP) were operating the UDDI Business registries

24. Extension • Network effects allow software platform firms to secure a dedicated user base, supported by complementers who in turn attract more users • Complementers provide applications which are compatible to the platform • Complementers trigger indirect network effects by making available useful, innovative and compatible software applications

25. Extension Contd…. • Firms involved in IT standardisation can have two pronged strategy • with the primary strategy of promoting network effects by large scale adoption by new users • the secondary strategy of enhancing value to the end users by leveraging indirect network effects by promoting adoption by complementers.

26. Extension Contd…. • Firms have two ways to extract revenue from standard setting: • primary licensing or extending proprietary control of higher-level services (layers) • IBM and Microsoft own significant intellectual property • This gives them motivation enough to work towards extensions to standards while maintaining their proprietary rights

27. Extension Contd…. • Microsoft follows the extension strategy • It first announces support for a standard and works with the standard bodies • Followed by partial/full support for the standard and adding extensions which work only with Microsoft interfaces • As Microsoft enjoys a dominant position, the increased use of proprietary extensions results in the Microsoft version to be the dominant one

28. Conclusion • One of the first efforts to analyse the process of IT interoperability standards formation involving inter-related standardization efforts progressing in parallel • The process of standard creation involves five intertwined states • the standardization processes unfold as a dynamic interplay of these five activities, albeit not in a linear-fashion

29. Conclusion • Standardization efforts of SOAP, UDDI and WSDL were progressing in parallel • dominant firms were IBM and Microsoft • playing a dominant role in not only proposing the standards, but also in deciding their evolution and final adoption • A specification may be selected due to not only transaction efficiencies but also because of resource and existing technology path dependencies

30. Conclusion • Standard setting tactics are influenced by prior relationships • more closely firms work on technical committees, more likely they will collaborate for a standardisation initiative • Maintaining proprietary control was important for firms in extensions and later stages of standardization, thus influencing firms' decisions related to licensing agreements

31. Conclusion • External factors such as COP play a significant role in defining the standards and the standard setting process • Dominant firms seem to agree for public ownership of basic layers, while they could enforce proprietary control over extensions or emerging top layer • Cause of concern for open source evangelists

32. Future Research • Extend the analysis of activities to other standardization processes • Examine the generalisability of the proposed model • examining the standardization efforts in other Web services standards such as WS-orchestration, WS-security, etc.

33. Future Research • Use alternate forms of research design and data collection • Survey based research • Explore network relationship effects, especially at the level of dominant firm and bridge firm, standard-setting bodies and major sponsors, and COP • This would be particularly relevant in the context of emerging IT standards.

34. Thank you Jai_ganesh01@infosys.com