Necessity, as the old saying goes, is the mother of Invention.
Throughout history, great success has come to those who have fulfilled people's needs with new inventions such as cars, airplanes, electricity, and fad diets. Though many of these fledgling industries grew to enormous proportions and helped shape the world as we know it today, two unpleasant by-products eventually surfaced to become a total buzz-kill for everyone at the party. The first was government regulation, aiming to protect economic, political, and personal interests. The second was Standardization, Invention's ugly step-sister.
Normally, Standardization doesn't get people all hot and bothered. She's boring, complicated, and restrictive, mostly reactive to situations, and not much of a headliner. But, there she is, constantly being eyed by businesses as a means to increase market share, reduce costs, and benefit from someone else's trials and tribulations.
As industry competitors start flexing their muscles by courting Standardization, incompatible or even adversarial product ecosystems can develop that muddy the market. Satellite radio, for example, comes in three distinct yet
wholly incompatible flavors: Sirius, XM, and SiriusXM. Proprietary hard drive formats still make file transfers between Macs and PCs a hassle. Both DVD-RW and DVD+RW discs exist, and I
still haven't really figured out
the difference between them. For consumers, these kinds of incompatibilities just add confusion and unnecessary hurdles to market growth, and even when a true industry standard develops, it isn't always the
best one.
When I say "product ecosystems", I'm referring to a distinct class of products that depend on other compatible products in order to serve a purpose. CDs and CD players, for example, constitute a simple ecosystem; one is not useful without the other. I'm not talking, however, about products that are intrinsically useful without relying on standards or much else, such as competing shirts from the Gap or Abercrombie or even cars from Buick or Ford. The world is big enough for—and indeed thrives off of—healthy competition and differentiation among standalone products. What hurts markets, at least in the short term, is industry titans who take their products and go running off in different directions like a herd of rabid cats, developing their own ecosystems often according to adversarial standards.
Think back, for example, to the war between VHS and Betamax video players, or more recently to the shootout between HD-DVD and Blu-Ray video players. With billions of dollars at stake, studios and electronics manufacturers fought tooth and nail to champion similar yet incompatible home video ecosystems using a winner-take-all approach that ultimately left consumers and investors to pick up the pieces.
This is where standardization gets hairy: sometimes manufacturers make sweeping decisions to dig their heels in and fight their competitors' ideas at all costs. In the years surrounding 1890, the
War of the Currents saw Thomas Edison develop an ingenious electrical system capable of sending power a few miles from a generator to urban customers and factories. George Westinghouse, however, pressed doggedly for a far more complex system that allowed higher-voltage electricity to travel hundreds of miles. In turn, AC power allowed massive central stations to be built that could be located well away from city customers, while simultaneously bringing rural customers into the market base who could not afford a DC system. Over the course of several years, each side spent ungodly amounts trying to drown the other in patent lawsuits. Edison's side even got down and dirty in the public arena by promoting lethal AC electrocutions of dogs, horses, and even humans. Finally, once AC beat DC as the world's
de facto distribution system, Edison's company, by now General Electric, did indeed come around and began making devices compatible with the system Westinghouse had championed all along.
Sometimes, incompatible standards arise from simple matters of preference, and don’t rear their ugly heads until much later. In the early industrial days of the United States, railroad companies were free to choose their own rail gauges, or the distance between rails. Compatibility wasn’t really an issue since most railroads operated autonomously and darted directly inland from the coast. It just so happened that in the process, most northern companies adopted standard gauge from the British, while those in the south adopted broad gauge from the Russians. This meant that if you wanted to send one of your trains from Pennsylvania to South Carolina, the rail gauge would fluctuate more often than the demeanor of a bipolar schizophrenic, and you’d be forced to either change out the axles on your train, or move your goods from one train to another entirely. By the time Congress declared standard gauge “standard” in 1862, the Southern states had already seceded, formed their own club, and were up to their necks in civil war. Ironically, over the course of the war, this railroad incompatibility became a key defense mechanism, preventing soldiers from riding the rails across enemy lines.
In the end, once Lincoln got the South in a headlock and forced them to drawl “uncle” in 1865, it was another 20 years before mounting economic pressure from the Yanks finally coerced the southern railroad companies to switch over to standard gauge and play nice with the rest of the country. In 1886, with laudable preparation and exacting precision, the undertaking of
converting 11,000 miles of southern rail to standard gauge was completed in less than two days!
Fortunately, many standards emerge and mature relatively unimpeded and unchallenged. After a decade of trial-and-error, the essence of the
QWERTY keyboard we use today was introduced in 1878. The year 1909 brought the standardized paper roll for player pianos, which in turn helped standardize the number of keys later found on electric pianos and synthesizers. The US standard for analog color TV,
brilliantly engineered to be backward-compatible with existing black-and-white TV sets, debuted in 1953. In that time too came standards for the brake lights on cars, the frequencies for commercial radio stations, and the sizes of doors in public buildings.
It is for this reason that some smart companies develop consortiums that transcend their own businesses. Consortiums allow competitors and partners both to develop common frameworks on which to base their product ecosystems. Think your iPhone is completely different than an Android phone? Nope! In fact, there are more similarities between the two platforms than there is water in a watermelon (92% water, to be exact). They access the Internet the same way, use basically the same cell towers, make the same phone calls, send the same emails, and receive the same text messages. In essence, the only thing stopping you from communicating with a phone from another manufacturer would be your own snobbish superiority complex. Thank you, Standardization!
Now (tounge-in-cheek alert), if we could just get our political systems to standardize too...
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