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The Myth of Free Standards:

Giving Away the Farm

"Information" has become the newest buzzword in our fully-integrated Internet culture. With the pervasiveness of personal computers and kids learning how to surf the Web at an increasingly younger age, information is now at your fingertips with just the click of a mouse. As Thomas Jefferson said nearly 200 years ago, information has truly become "the currency of democracy." The free flow of information can facilitate public empowerment, corporate productivity, and greater prosperity and education among a population.

However, even Jefferson would not claim that information should be given away for free. In the case of standards information, it should not.

If information is the currency of democracy, standards are the bridges that link global trading partners. Standards are a unique type of information and their widespread circulation and incorporation into products and services is essential for eliminating barriers to trade. A growing consensus among standards developers and users contends that making standards available at no cost will further their use and development, thereby strengthening bridges and shrinking barriers to trade. Nevertheless, proponents of free standards are forgetting one important fact: bridges have to be designed, constructed and maintained. Giving standards away free will eliminate the most significant source of funding for standards development. It will also create a greater imbalance of support between contributors and non-contributors (to the development process) and lead to a host of other problems. The cost of standards has become a confounding and contentious issue. This essay seeks to resolve the question of "Standards: Fee or Free?"

The Fundamental Reasons
The standards development process costs a great deal of money. This fact is not new, but a good portion of standards users fail to understand the many steps required to provide them with the standards that they so eagerly desire. There are significant expenses other than the cost of printing and distributing printed editions.

Much like the United Way or any other volunteer organization, standards developers spend time and resources on coordinating the efforts of volunteers in the development process. From the moment a standards project is initiated through its arrival on a user's desk (or computer screen), funds are spent on testing, materials, meetings, distribution of draft documents, balloting, and adoption of the initial project as a standard. Every five years, a standard must be revised, reaffirmed, or withdrawn to address current technology. All of these activities require a full time staff employed by the standards developing organization (SDO). While some organizations can operate with a small support staff, others like ASTM and ASME require dozens of people dedicated to supporting the efforts of their respective volunteers.

Once a standard is developed, there are additional costs for publishing, printing, and public relations. Users frequently require assistance in finding the standards appropriate for their needs, thereby requiring a staff of information specialists to provide support. There are also considerable resources spent on promoting the acceptance of standards in the marketplace. SDOs regularly invest in the education of federal, state, and local officials to prove the merit and integrity of standards and the development process. Since users rely on market acceptance of standards to operate commercially, this is an important function provided by SDOs.

The distribution and access systems may be the most significant costs of standards development. Catalogs are created and maintained so users know what is available. Distribution outlets are staffed to provide fulfillment by printed editions or other formats. In the case of electronic dissemination, the costs of printing and distribution are less, but there are weighty costs for electronic document publishing, electronic file maintenance, facilities and equipment for providing online or other methods of access, and customer support for electronic applications.

Standards as Commodities
Information is any bit of knowledge or data which provides the recipient with a greater understanding of their competition or market, or which provides an advantage in dealing with a future event. Information fuels technology, innovation, and creation. Information is a critical component of design, production, and manufacturing. Information can build profits, increase efficiency, and keep you ahead of the competition. Virtually all companies would place a value on gaining these competitive advantages, so we can safely assume that companies would (and do) pay for information. Information holds value. Information is a commodity.

Standards are no different. An industry standard which dictates the consensus rules for designing, manufacturing, testing, inspecting, or installing a product or service on the commercial market holds significant value. Standards strengthen a company's position in national and foreign markets, ensure product quality and safety, and set them ahead of their competition. Consequently, standards are undeniably critical pieces of information. If a company needs to comply with regional or international standards to get a product to market, they should be willing to pay for the information required to do so.

Like other forms of information, the use of standards is an investment in the success of a product or service. Ford Motor Company pays for demographic information on customer preferences in China -- an investment in foreign markets. Citibank pays for credit information on their cardholders -- an investment in maintaining its collection rate. University students pay for textbooks -- an investment in their education. If using a standard is considered necessary for the success of a product or service, then standards users should not see it differently than obtaining any other component of the product.

Contrary to the popular beliefs spawned by our Internet culture, information is not free. Like all other commodities, information trades at a market value based on supply and demand. Standards too should be traded on a supply and demand basis, fetching a cost that pays for their development and funds the publishing, marketing, and distribution processes.

Reducing the Incentive for Private Innovation
Third-party standards providers are some of the most adept organizations at selling information, including the niche market of standards. Fueled by increasing sales, healthy cash flow, access to the newest technology, and a vastly different corporate structure than SDOs, they combine innovative products with professional information services. It cannot be denied that these private standards providers significantly improve the access to and distribution of standards documents. Nevertheless, while these companies may voice their opinion in this debate, only SDOs will make the final decision on "fee or free."

If SDOs decide to make standards available free of charge, users will be quick to find the free sources. Consequently, private companies could no longer expect to earn profits on document sales and information services. Naturally, we would see a quick demise of the products and services, and possibly even the companies themselves, that have complemented the standards community for so long. Some SDO administrators and standards users would praise their passing. But the truth is that these companies are an integral part of the international standards community and without them, the information infrastructure will suffer. Powerful Web databases, subscription services, electronic media formats, free information searching, and professional assistance in finding standards information will be harder and harder to find.

Certainly, SDOs could pick up some of the slack from diminished corporate presence. But unless they receive vast influxes of cash (and it won't come from standards sales, will it?) and technical expertise, then most likely, users will be left without the valuable tools that private companies provide. Before making standards free of charge, we should examine standards users' dependence on these companies and decide if the decision will be worth the sacrifice that users will have to make.

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