Remarks at U.S.-China Innovation Dialogue

Dr. Holdren, Minister Wan Gang, and distinguished colleagues, it is a pleasure to join you today for this important dialogue between our nations.

I'd like to start this panel discussion off with a big-picture view of the relationship between standards and innovation. 

These two critical elements of any modern economy seem like opposites. Standards are inherently about making things similar. Innovation is about what's new and different. The lead- in to this panel rightly points out that scholars and policymakers continue to debate the exact interplay between the two.

In my view, standards and innovation are linked in 3 key ways. 

• Standards pave the way for market acceptance of innovative technologies. I think we can all agree on this. 
• Standards enable interoperability, which in turn, allows widely distributed supply chains and global trade in high-tech products. 
• And standards enhance competition. Economies grow and markets work best when the most innovative, sought-after products reach the greatest number of people, at the lowest cost.

I doubt you are surprised that I passionately support the value of standards. After all, my agency literally has standards as its middle name. So at least for me, there is no debate about one thing. Standards are a necessary critical element for healthy national and global economies. 

At NIST, we have a century of experience to prove this point. We were created to help U.S. manufacturers better exploit the wonders of innovation resulting from the industrial revolution at the beginning of the 20th century. We were then, and still are intimately involved in the development of both measurement standards and documentary standards. 

In the early 1900s, [it was] documentary standards (or specifications) like the chemical composition of concrete or various types of steels, and measurement standards (in the way of certified reference materials) for use in quality assuring chemical measurements to verify that those specifications were properly adhered to by producers.

Now, in the second decade of the 21st Century, among the over 1,300 certified references we provide are certified reference materials for "the number of genetic triplet repeats" for diagnosis of Fragile X Syndrome or our "Genome in a Bottle" Standard Reference Material to ground truth new and innovative genetic sequencing technologies. 

I will give several examples of documentary standards as I continue. 

So to reiterate, 100 years of our history shows that standards have provided the common language and the quality assurance that markets need to enthusiastically support emerging technologies—the radio, automobiles, aircraft, television, computers, cell phones, the Internet—and the list goes on and on, to include even "the internet of things." 

In short, standards ensure that new technologies perform as expected, while still allowing manufacturers to differentiate their products from each other in innovative ways.

One simple current example of the power of standards is the USB port. Before USB's adoption, different types of connectors were needed to transfer data to or from devices like cell phones, laptops, tablets or printers. Now, we simply take for granted that data can be transferred seamlessly. 

The strength of any standard rests firmly on the foundation used to create it. The most effective standards arise from processes that are transparent and open to a wide range of stakeholders. 

One recent example is the development of standards for smart grid technology, which uses Internet-style communication to better manage the electrical grid. In 2009, NIST helped convene an open public-private forum for identifying missing technical standards needed to make the smart grid work. Having now grown to hundreds of members, the forum now operates independently and has worked with ISO and other groups to create a catalog of more than 75 practical and well-supported standards. 

Bringing together a diverse group of manufacturers and regulators, academics and policymakers, consumer advocates and businesses is often messy, but it results in approaches that are well supported and actually get used. 

We've found that one of the most effective functions of government in the marketplace can be to support such public-private partnerships. But for innovation to truly flourish, another ingredient is critical: a suitable policy environment. 

A key example: policies that support and protect intellectual property (IP), particularly those essential to standards such as patented technologies. To invest in innovation, IP owners must be reasonably compensated for the fruits of their labor and IP users need assurance that they can use that IP in a fair manner. There needs to be clear rules and policies that balance the interests of both parties. The government should not dictate important issues such as royalty fees or force IP owners to share their patented technology for developing standards. Such an environment encourages full private-sector participation in the development and use of up-to-date standards, which ensures that buyers can compare the performance of both the new and innovative with that of established products, fairly. 

Which brings us full circle. What is the relationship between standards and innovation? 

Standards drive economic growth by providing consumers with cheaper products, greater product choice, and faster product innovation. We at NIST maintain a cutting edge research program to underpin the measurement standards needed to support U.S. industrial innovation and to improve our quality of life. 

We formally benchmark our measurement methods and standards internationally with the Chinese National Institute of Metrology (NIM China) and other NMIs around the world (through a very formal process derived from the International Meter Convention). 

We provide our technical expertise to underpin the private-sector-led development of documentary standards. About 400 NIST staff serve on approximately 1,000 national and international standards committees. 

I look forward to hearing other's views on how we can collectively work to ensure that standards support innovation to the benefit citizens in both our countries. 

Thank you.