FIRE

Argues that producer-led innovation is ceding ground to innovation by single users and open collaborative innovation (e.g., open standards and open source). Part of the reason for this is that computing and the Internet reduced two costs relevant to these models: design and communication.

Another interesting assertion:

Regulation can be viewed as a form of transaction cost imposed by the government on all three innovation models. Drugs, commercial aircraft, and automobiles are among the product types that must meet heavy safety-related regulatory burdens before being allowed to enter the marketplace. Regulation in the form of standard setting affects many other industries, such as telecommunications. Within our theoretical framework, regulation and standard setting tend to decrease the value of innovation opportunities, thus shrinking the bounds of viability.