On January 21, the European Enterprise Institute (EEI) hosted a conference in Brussels which was entitled “IP-Free Open Standards in ICT:  Another EU Own Goal in The Innovation Race?”  The conference’s attendees discussed where pressure for the use of open standards in the EU is coming from, and whether the populist rhetoric calling for “openness” risks turning Europe into an innovation dead zone. 

The European Commission is currently preparing to lay out a strategy for the ICT sector in the 21st century.  As it is doing so, increasing pressure is being put on EU and national public authorities to buy ICT products that conform to open standards that contain no intellectual property, or in which the intellectual property is subject to low or zero royalty rates and/or cannot carry use restrictions.

Advocates of open standards usually cloak their lobbying activities in public interest rhetoric, claiming that interoperability is an essential public interest value for electronic documents and that only IP-free open standards can fulfill the need for interoperability. 

However, as ACT has pointed out before, some of that rhetoric is merely a means for furthering a business model that is based on giving away software (and the intellectual property it contains) for free in order to help sell hardware, generate services, or sell ads and collect user data. 

It is legitimate for companies to want to create an environment that furthers their business model.  Whether it’s also legitimate to do so by using sometimes misleading public interest rhetoric is a different question. 

However, what EU politicians and regulators should be even more worried about is the potential cost to innovation and the negative effects on e-government that mandated open standards can bring with them. 

A narrow definition of open standards can exclude many well-established technologies from being used for e-government services.  It can also result in innovative start-ups that rely on patent protection to establish themselves in the market place being shut out from government procurement processes.  

Contrary to what is often said, commercial software is not the playground of big business, but primarily of inventive SMEs thriving in niche markets. Only the protection of their intellectual property permits those innovators to create growth and jobs.

Commercial software must therefore be allowed to compete on a level-playing field with other software types. Public procurement decisions should be based on technology neutrality.  In other words, governments ought to buy software on its merits and not through categorical preferences. 

Mandating the use of open standards would mean undermining Europe’s innovative companies at a time when we need them more than ever.