  When decisions about developing standards are left to individual firms, there
are many advantages including a flexible response to market evolution,
accommodation to rapid technology change, and avoidance of costly coordination.
However, the market process does not necessarily lead to compatible standards,
especially when there is no clear market dominator. Standards Institutions
generally facilitate better communication among market participants, which may
discourage early and/or primitive incompatible standards to emerge in the
market. However, expenditures on institutional standards-setting can lead to
diminishing returns, or even be counter-productive because institutional
standards usually take longer to produce and are slower to respond to
technology development. Government agencies can specify compulsory standards to
avoid incompatibility. In addition, governments can tie their policy on
standardization closely with their industrial, trade, and/or regulatory
policies. However, many exogenous factors handicap a government's effective
involvement. Government often fails to respond to the dynamics of technology
development and consumer demand, and to pick up the "right technology". This
study first discusses why two different models have emerged in the two regions.
It then examines outcomes and implications of the two models, including impacts
on domestic service deployment, global trade competition, technology
innovations, and strategies of multinational corporations. The goal is to
conduct an empirical comparison between the two contrasting models.
