Technology, telecoms and outsourcing

In a nutshell

Technology lawyers distinguish themselves from general commercial advisers because of their specific industry know-how. They combine a keen understanding of the latest advances in various technologies with a thorough knowledge of the ever-changing law that regulates, protects and licenses them. As forms of media and new technologies converge, clients have come to rely on technology lawyers’ innovation and imagination in offering rigorous legal solutions to maximise and protect income and ideas. The majority of the top 50 firms possess dedicated groups of lawyers. There are also specialists within many smaller commercial firms and a number of niche firms. 

What lawyers do

• Advise on commercial transactions and draft the requisite documents. There is a heavy emphasis on risk management.
• Assist in the resolution of disputes, commonly by arbitration or other settlement procedures as this is a court-averse sector. Many disputes relate to faulty or unsatisfactory software or hardware.
• Help clients police their IT and web-based reputation and assets. Cyber-squatting, ownership of database information and the Data Protection Act are common topics.
• Give clients mainstream commercial, corporate and finance advice.
• Specialised outsourcing lawyers represent customers and suppliers in the negotiation and drafting of agreements for the provision of IT or other services by a third party.

The realities of the job

• You need to be familiar with the latest regulations and their potential impact on your client’s business. Does a website need a disclaimer? What measures should your client take to protect data about individuals gathered from a website?
• You need a good grasp of the jargon of your chosen industry, firstly to write contracts but also so you can understand your clients’ instructions. Read trade journals like Media Lawyer and Wired, or magazines such as Computer Weekly or New Scientist.
• The ability to think laterally and creatively is a must, especially when the application of a client’s technology or content throws up entirely new issues.
• In this frontier world, gut instinct matters. One in-house lawyer made what looked like a risky move from BT to little-known internet auction site, eBay. Six years later he moved to head up Skype’s legal team – a perfect example of the convergence of internet and telephone technology.
• High-end private sector outsourcing involves complex, high-value and increasingly multi-jurisdictional work. Mostly, it is the larger law firms that handle such deals. In the public sector, deals involve UK government departments, local authorities and the suppliers of services to those entities.

Current issues

• Digital convergence throws up many legal problems as the business opportunities created by new technologies move beyond the capacity of existing legal or regulatory structures to contract or protect. Copyrighted content being transferred onto handheld devices; film or TV programme downloads from the internet… the list is practically endless.
• Many firms and their clients now believe that technology, media and telecoms are no longer three distinct markets, and structure their departments accordingly.
• The merger of T-Mobile and Orange's UK operations (a joint-venture between Deutsche Telekom and France Télécom) created Everything Everywhere, the largest mobile network in the country.
• The most interesting telecoms work is taking place overseas, particularly in Africa and Asia. India’s Bharti Airtel’s $9bn takeover of Zain (South African telecoms) is the ultimate example of this. There is plenty of room for manoeuvre in the emerging markets, unlike western Europe.
• There is still plenty to do in the regulatory arena. Telecoms companies in the UK continue to try to chip away the infrastructure that gives BT a massive competitive advantage over its rivals, particularly in terms of how much it pays for its cabling.
• Technology was one of the hardest hit areas during the recession, but the sector has recovered well since then and lots of law firms are building up their work in this area. Predictions suggest worldwide spending on IT (which stands at over $1.5tr) will increase by 5% in 2011 on 2010. Unsurprisingly, growth has been especially strong in emerging markets like India.
• IT outsourcing began in the late 1980s, followed by business process outsourcings (BPOs) that involve handing responsibility to third-party service providers for functions like human resources, finance and accounting. Today, the lines between technology outsourcing (TO) and BPOs are blurred. Smart outsourcing – the concept of outsourcing parts of a company, one part at a time, often using different suppliers – is in vogue at present, as is multisourcing (using many different suppliers on shorter term contracts).
• Legal Process Outsourcing is gaining momentum and many big firms have started sending work to India and South Africa. Outsourcing is being used by all kinds of businesses and organisations. The Royal Pharmaceutical Society recently outsourced email and data storage .
• As outsourcing increases, so do the number of outsourcing disputes. In a recent case between De Beers and their outsourcer Atos the High Court found that Atos was liable for breach of contract damages.
• The 2010 Digital Economy Act has proved controversial. Amongst other things it made changes to copyright infringement rules and expanded the obligations if ISPs. The most controversial part of the act - the blocking of copyright infringing websites - has now been dropped and the High Court has already granted permission for judicial review of various sections.
• The government recently announced plans to roll our a UK-wide super-fast broadband network by 2015. The government has earmarked £830m for the project, but expects most of it to be paid for by private investors.

Read our True Pictures on:

- These firms for telecoms

- These firms for outsourcing