OME standards 28mar07

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OME economics of standardisation : 

OME economics of standardisation 30th March 2007 Patrick Courtney Seer Green, UK

Introduction : 

Introduction Background innovation + diffusion literature in last 10 years Definition of 4 types of standards Economic significance to producers and users macro-economic role micro-economic role Trade competition and market size: evidence/data/attitudes Function of market structure and product life cycle Relevance to OME file format What’s missing, next steps

Types of standards (1 of 4): 

Types of standards (1 of 4) Interface standards eg VHS/betamax, Blu-ray/HD, XBOX/PS3 Economic effects Switching costs (learning, exchange) Reduces risks as perceived by producers & customers Network effects: Metcalfe’s law Direct: eg mobile phones Indirect: eg car parts May be positive or nil Fairly weak for OME unless collaborations arise… Source: Swann, wikipedia

Types of standards (2 of 4): 

Types of standards (2 of 4) Minimum quality especially safety legal usability basic functionality etc Economic effects Reduces risks that are hidden/hard to assess Helps to protect a market against Gresham's Law “bad drives out good” Reduces transactions costs between different producers, as well as between producers & customers Not applicable to OME file format (but see later…) Source: Swann, wikipedia

Types of standards (3 of 4): 

Types of standards (3 of 4) Variety reduction eg clothing sizes very applicable to software Economic effects Avoids wasteful profileration Provides economies of scale Helps to build cohesion & critical mass in the formative stages of a market Can focus technology trajectories Applicable to OME file format ! Source: Swann, wikipedia

Types of standards (4 of 4): 

Types of standards (4 of 4) Information/measurement on product description eg screw thread eg mm vs inch (japan?) Economic effects allows innovative producers to demonstrate to the satisfaction of the customer, that products are as innovative as they claim to be role of public bodies Not directly applicable to OME file format (?) Source: Swann, wikipedia

Linking types of standards to economic benefit: 

Linking types of standards to economic benefit Four types Interface standards and network effects Minimum quality and hard-to-assess features Variety reduction and focus of effort Information/measurement Economic significance to producers and users micro-economic and macro-economic role For users Reduced transaction costs Reduced risk Increase market size and volume -> Increase competition Ability to absorb faster rate of change In short, the existence and use of standards makes it easier to produce, sell and buy products and services. Standards enable a market. They are part of the infrastructure for innovation-led growth Codifies state of the art technology and best practice Role in diffusion of innovation… Source: THE ECONOMICS OF STANDARDIZATION: Final Report for Standards and Technical Regulations Directorate UK DTI, G M Peter Swann, Manchester Business School

Economic benefit of standards: survey of attitudes: 

Economic benefit of standards: survey of attitudes Gains to companies Help in technological change Export and new markets Competitive advantage: be ahead of competition, assert interests participation offers insight, product opportunities, learning, networking Reduce development costs, save on rework Co-operation with suppliers and complementers Hindering R&D: mixed but reduces risks & hinders less than administration (Companies that use standards perform better) Gains to economy Used as trade barrier in 1970/1980, international standards increase trade Mere existence is positive Innovation (as patents) + diffusion (as standards) Standards are at least as important as patents… Source: DIN (2000) Economic Benefits of Standardization: Summary of Results, Berlin: Beuth Verlag GmbH

Data on German macroeconomic growth between 1961 and 1996: 

Data on German macroeconomic growth between 1961 and 1996 Output = growth of value added Inputs Value of assets Number of employees Stock of patents Value of licences Stock of standards Importance of standards to support innovation+diffusion Standards contribute more to economic growth than patents and licences Sources of growth in the business sector, 1961 - 1996 Source: K Blind, H Grupp and A Jungmittag, 1999, The Influence of Innovation and Standardisation on the Macoreconomic Development in Germany, Paper to 1st IEEE Conference on Standardisation and Innovation in Information Technology, Aachen, September

Role in product life cycle: 

Role in product life cycle Promote growth of supporting products and services Source: THE ECONOMICS OF STANDARDIZATION: Final Report for Standards and Technical Regulations Directorate UK DTI, G M Peter Swann, Manchester Business School

Role of industry structure: 

Role of industry structure If market is concentrated de facto standard, closed or open standard If market is fragmented Innovative – need to avoid waste of limited resources Not innovative – doesn’t matter So is this relevant to microscopy/cell imaging for research/drug discovery ?

Relevance to OME file format: what’s missing, next steps: 

Relevance to OME file format: what’s missing, next steps Some suggestions for users and suppliers: 1. Make network effects direct Collaborative science 2. Harness benefits to users Encourage user pull (including publishing needs) 3. Coordination of smaller suppliers Save resources Reduce risk 4. User levels and profiles according to usage types (minimum quality effect) Screening: control , SOPs Core facilities: share data Pharma: control, SOPs Bio/image informatics: control, SOPs 5. Continue promoting, meeting, sharing experiences

…too many standards ?: 

…too many standards ? MIACA - Minimum Information About a Cellular Assay (http://miaca.sourceforge.net/) OME - Open Microscopy Environment (http://www.openmicroscopy.org/index.html) Libics - Image Cytometry Standard (http://libics.sourceforge.net) MIAME - Minimum information about a microarray experiment (http://www.mged.org/Workgroups/MIAME/miame.html) Bioinformatics Standards for Flow Cytometry (http://flowcyt.sourceforge.net/) FCS - Flow Cytometry Standard API's Standards (http://www.pathologyinformatics.org/standards.htm) DICOM - Digital Imaging and COmmunications in Medicine (http://medical.nema.org/dicom/2003.html) LDIP - Laboratory Digital Imaging Project (http://www.ldip.org/) Source: Ilya Ravkin 2007

Source:: 

Source: THE ECONOMICS OF STANDARDIZATION Final Report for Standards and Technical Regulations Directorate Department of Trade and Industry G M Peter Swann Manchester Business School University of Manchester 11th December, 2000 http://www.dti.gov.uk/files/file11312.pdf http://www.dti.gov.uk/files/file11316.pdf

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