United States > Media, technology and telecoms > Overview
The hi-tech and telecoms sectors are leading the way out of the recession driven by technological advances and market convergence, and 2010 was a particularly active year for firms specializing in these areas. Major themes include the digitization of content across different platforms, interactive ways of delivering, promoting and utilizing content and a sharp focus on data and security. Consumer technology trends are spilling over into business, and organizations are leveraging technology through outsourcing and joint ventures. Cloud computing is changing the way businesses and individuals are using technology. The fast-moving telecoms and broadcast sector has seen an uptick of work for transactional lawyers, focusing on big-ticket M&A and local and international joint ventures. The regulatory environment has focused on data protection and privacy, particularly online as well as ownership issues in the telecoms and broadcast sector.
These trends are particularly relevant to advertising and marketing, as consumer brands compete for customers by leveraging sophisticated interactive media. Advertising firms handle advisory, transactional and litigation work, including Lanham Act false advertising cases, class actions and Federal Trade Commission (FTC) investigations and challenges before the self-regulatory National Advertising Division (NAD) of the Council of Better Business Bureaus. Work in 2010 focused on regulating advertising practices across new media platforms – including social networks – notably targeted and behavioral advertising.
Advertisers require advice on the legitimacy and defense of their advertisements and potential challenges to competitors’ advertising. Particular areas of focus for advertising lawyers include healthcare, financial services and retail, marketing to children, and multi-platform promotions.
The Obama administration’s focus on data protection and privacy regulation, and a more active FTC has produced significant work, especially for firms with a strong Washington DC presence. The 1996 Health Insurance Portability and Accountability Act (HIPAA) continues to be of particular relevance, along with the 2009 Health Information Technology for Economic and Clinical Health Act (HITECH) Act, which covers privacy and security elements of the electronic transmission of health information. The financial services sector also has specific regulations, notably the Gramm-Leach-Bliley Act, the Credit Card Accountability Responsibility and Disclosure Act 2009 and the Dodd-Frank Act 2010. Compliance with the rules in different jurisdictions and the regulation of privacy on the internet are key considerations. Data transfers, data-security assessments and breaches, FTC regulatory investigations and data protection policies are significant sources of work. Cloud computing and social media add new dimensions to an already complex area.
Outsourcing continues to be a hot topic. Firms handle the contractual and strategic elements of major outsourcing deals, generally working on the customer side. In 2010, work focused on multi-sourcing and replacing and renegotiating existing outsourcing arrangements, often consolidating services with a single provider. As their existing IT investments reach end of life, businesses are looking to outsource non-core services to achieve cost savings and efficiencies. The biggest most complex deals tend to be handled by dedicated individuals with recognized expertise working at firms with the size and international bandwidth to put together complex, multinational outsourcing arrangements. Consequently, leading names attract a loyal client following and prestigious work and lateral moves make a significant difference to firms and their position in the market.
2010 saw numerous firms involved in technology transactions ranging from serial high-value acquisitions by leading global names, infrastructure investments that had been delayed by the recession and innovative start-ups merging and engaging in joint ventures to activity in specialist areas such as cleantech, biotech and life sciences. The increasing convergence of IT, telecoms and media, the growth of cloud computing and innovation have kept the market buoyant. The work that firms do in this area depends on type of clients they represent, ranging from start ups in emerging technology areas to global giants and technology investment funds.
The telecoms sector was boosted by the Obama administration’s stimulus funds and national broadband plan. The Federal Communications Commission (FCC) has expanded its remit to include internet-related issues. Firms ranging from global players to specialist boutiques advise leading industry players on proposed regulations around online activities and topical issues such as net neutrality and spectrum allocation.
Firms that include lawyers with FCC experience can provide specialist regulatory expertise, and many of the leading practices are based in Washington DC. This section covers broadcast and satellite work, as well as traditional telecom work, in recognition of continued convergence between different elements of a dynamic industry. Companies looking for regulatory and compliance advice come from increasingly diverse sectors. Investors, content providers and internet companies consistently turn to the market leaders for counsel, and increased FCC and government activity is producing an increase in regulatory work.
The ability to offer both transactional and regulatory expertise does not necessarily define the most successful practices, as some clients retain separate transactional and regulatory counsel. The tables focus on firms with dedicated expertise, and so may omit some larger firms, despite the fact that their corporate partners act on large transactions in this space. Strong transactional firms and firms that offer specialist expertise in particular areas are commonly involved in telecoms transactions. Increased deal activity was driven by market consolidation and joint ventures between complementary providers to offer different content and other resources via mobile phones. Convergence between the telecoms, broadcast, cable and media industries has produced a stream of big ticket M&A transactions, with attorneys representing the various parties and the banks and private equity firms investing in the telecoms and broadcast industry and in some cases helping to structure the deal. There were also more transactions involving telecoms providers and broadcasters in different jurisdictions. This trend gives firms with a strong international presence an advantage over local boutiques.