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Figure 4.5: Approaches to interop Chapter 4

UNILATEAL
APPROACHES

unilateral design mandating standards
NON-REGULATORY REGULATORY
APPROACHES reverse engineering disclosure of information APPROACHES
(PRIVATE ACTORS) (STATES ACTORS)
IP licensing transparency for consumers
technical collaboration public procurement

COLLABORATIVE
APPROACHES

Source: John Palfrey & Urs Gasser, Interop (2012)
4.5.1.1 Unilateral design and IP licensing or rights associated with the technology’s
use. The effectiveness of a licensing approach
The first cluster of approaches includes those to interoperability not only depends on the
that are marked by a comparatively low degree company's willingness to grant a licence in the
of collaboration between the systems that are first place, but also on the terms in the licensing
interconnecting. Unilateral design occurs when agreement.
a market participant designs its products or
services in a way that allows other players to The scope of -- and compensation for -- the
offer interoperable products or services. The licence plays a particularly important role. IP
range of possibilities in this cluster of more licensing can be a cost-efficient path toward a
"unilateral" approaches is considerably broad. For higher degree of interoperability, especially in
example, companies often use APIs as a unilateral cases where transaction costs are minimized
invitation for others to interconnect. In the case through sophisticated and "streamlined"
of single-sign-on, digital ID offerings, companies licensing procedures. The flexibility of a licensing
like Facebook offer an open API that any app or arrangement may decrease, however, if the
online store can utilize, provided they comply with ecosystem changes. This was precisely the pattern
Facebook’s rules for accessing the API. Twitter’s observed in the publishing dispute between
revocation of its open API is a cautionary tale of Hachette and Amazon. When the market was
how reliance upon unilateral forms of interop may relatively immature, the licensing agreements
be risky, because they can be withdrawn as easily between the publishers and e-book makers were
as they are offered. fairly simple, largely following existing licensing
models. However, as the market matured and
Another important and related way to achieve Amazon’s Kindle became the dominant technical
interop with minimal collaboration is through platform, the book publishers feared a loss of
IP licensing, in which one party grants another flexibility in the licensing terms. At that point,
access to technology, specifications, and/ the licensing process became far more fraught,

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