‘TMT Report 2013: Keep up or log out’, with Hugo Écija insights
No longer a niche practice, TMT has taken the legal world by storm. And lawyers say that one thing is very clear in today’s ‘digital economy’ – these days there is no industry that isn’t affected by TMT. But the sector is evolving at such a rapid pace, that clients, law firms and regulators are having a very hard time keeping up, and applicable legal frameworks are almost out-dated before they become effective.
TMT is now an intrinsically ‘global’ sector, as regardless of whether or not clients ‘physically’ globalise their operations, the majority of business these days is conducted via the Internet and e-commerce – which know no frontiers.
Players in the Iberian TMT market are innovative and very active. “Their innovation departments are always looking for new products and services that can bring value to clients,” says Magda Cocco, Co-Head of Telecoms & Media at Vieira de Almeida, “and, most of the time, these new products and services challenge traditional legal concepts”.
But the TMT laws are a step behind the actual development reality, explains Javier Marzo Cosculluela, Co-Head of TMT at Garrigues, Spain, as the sectors are so technologically advanced and change at a very fast pace.
Despite being a fortunate and healthy industry, certain areas, particularly those that have not yet adapted their business models to the digital economy – traditional press, broadcasting, etc – are suffering. “What is clear is that disruptive technologies will transform business,” says Javier Fernández-Samaniego, Managing Partner and Head of TMT at Bird & Bird Madrid, “pushing Spanish and global economies forward”.
Companies must always stay ahead of their competitors, and reinvent themselves and their products in order not to be left behind, says Rodrigo Almeida Dias, a Corporate and TMT Partner at F. Castelo Branco & Associados. Therefore, imagination, proactivity and reaching out to the ever-more demanding needs of consumers are key elements in this extremely competitive industry.
The challenges of innovation
It seems that every day there are new methods of communicating, says Pablo Mayor, Head of Public Law at Allen & Overy, as well as new devices, users and ways of providing services.
And both businesses and individuals are part of this digital economy, with smartphones, tablets, the Cloud and social networks forming part of their daily lives. “Therefore, one of the main challenges of the TMT sector is to find the right balance between increasing consumers’ demand for services and products, and the level of security required to ensure privacy rights,” explains Francisco Brito e Abreu, Corporate Partner at Uría Menéndez – Proença de Carvalho.
Another issues is that the subsectors are converging – telecoms and contents for example – accelerated by the massive increase in use of mobile devices. “The challenge for clients is that they don’t always have the expertise to deal with these ‘neighbouring’ markets and end up competing for the same clients,” says Raul Rubio, IT and Communications Partner at Baker & McKenzie, Madrid, “but coming from very different backgrounds”.
Every year there are new IT applications and devices, innovative software and social conducts that lack enforceable regulatory support. “We strive to help clients to be protected and confident in this transforming environment, as we have to be constantly learning about technical developments,” says Norman Heckh, Director at Deloitte Abogados. In the coming years, almost every company will therefore have to focus its business on the Internet and new technologies, and law firms need to be prepared to provide the most up-to-date support.
The speed of change also presents special challenges for the industry itself. “We are witnessing big players in the tech industry, such as Blackberry or Nokia, struggle when their products and services are no longer current in the market,” says Hugo Écija, Managing Partner of Ecija. “TMT is not about adapting to the market – you’re either in or out – it is about innovation and anticipation.”
And innovation is a key concept for success in today’s crisis economy – but the difficulty is finding the funds to do so. “Access to capital is difficult,” explains Almudena Arpón de Mendívil, TMT Partner at Gómez-Acebo & Pombo, Madrid, “and companies have to invent new forms of generating funds for their research and development projects”.
The difficulty is to be able to predict future problems in an area that changes at such astonishing rate. As well as explaining to clients that the existing entities – regulators, courts and public administration – evolve at a much slower speed, says Filipe Mayer, a TMT Partner at CCA Advogados, and, in most cases, are unprepared to reply in a suitable way to the challenges placed by this sector.
In the 1990s, there was time to plan and think about where technology was going, adds Pablo González- Espejo, Head of TMT at Uría Menéndez. “Nowadays, there is little time to regulate as things change so fast and keep getting faster. Regulations can hardly keep up with the industry and therefore don’t always meet the expectations of the market.”
As TMT involves state-of-the-art innovation that changes so quickly, as lawyers we are always betting on what the regulators may do, says Diego Ramos, Head of TMT at DLA Piper Spain. And across Iberia, many developments have taken place recently, while some very notable examples do stand out.
Read full report here: http://www.iberianlawyer.com/index.php/special-reports-practice-areas/tmt-ip-life-sciences