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This paper explains why profit-seeking companies participate in standardization activities and patent pools, even if the activities benefit their rival companies, and pays special attention to the relation between standards and patents. We examine the question from the perspective of economic theory using the concepts of the tragedy of the anti-commons and leap-frogging. The tragedy of the anti-commons explains why companies cross-license their patents and the patent policies of standardization organizations imply cross-licensing. The leap-frogging describes why companies who own essential patents to implement standards license their patents to companies who have no related patent. By granting licenses to others, companies are rewarded in the short term with economic benefits and in the long term with strategic opportunities to exert influence on market trends. In the final section, recommendations are given to private companies, based on the considerations given in this paper.