In 2023, Technology spending for IT services and software in corporate America remained strong, despite the Fed’s sharp interest rate increases causing caution in markets. Businesses shifted focus from investing in next-gen technologies to maximizing operational efficiency and cost savings. ChatGPT, generative AI, cloud-based services, and edge computing for IoT experienced enthusiastic growth. However, metaverse and NFTs failed to live up to the hype, and the collapse of FTX impacted the crypto market.
In 2024, technology spending is forecasted to remain strong, with double-digit growth in IT and software services driven by AI-driven solutions. Key trends in 2024 for technology and IT lawyers include the accelerated integration of genAI in enterprise software, new markets and licensing models for data monetization, digital transformation and the continued growth of Global Capability Centers, and a trend towards vendor consolidation.
The increased use of genAI presents both opportunities and risks for businesses, requiring a deep understanding of the technology and potential legal and ethical implications. Additionally, legislative changes governing AI and AI platforms are expected to impact genAI’s adoption rate.
The trend towards alternative licensing models and data monetization will require careful consideration of data usage, compliance with regulations, and liability allocation for data usage.
As digital transformation continues to be a priority for businesses, there is a growing emphasis on environmental impact, sustainability, and the complexity of digital platforms. IT and outsourcing contracts are being restructured to capture this complexity and the shift towards onshore cloud infrastructure.
Global Capability Centers are experiencing renewed interest as businesses seek to optimize costs while building internal talent in new tech domains. Setting up a GCC can yield strategic benefits, but it requires careful assessment and addressing of operational, financial, legal, and regulatory considerations.
Vendor consolidation is picking up steam, as organizations seek to simplify their IT and Business process services environments while managing the proliferation of niche vendors in the everything-as-a-service model.
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