Predictions 2010: First Post

December 1, 2009

{b} From Kit Burden, Partner and Head of Technology, Sourcing and Commercial Group, IP and Technology Department, DLA Piper UK LLP{/b}

In terms of technology, cloud computing will continue to grow in popularity, with the cost advantages gradually storming the barricades of even the more conservative financial institutions, once their security concerns are allayed. Open source will equally continue its inroads into the world of proprietary software, with giants such as Microsoft and Oracle increasingly forced to recognise it as a genuine force for change rather than a sideline/exception to the rule.

On the outsourcing side, whilst VAT changes will place some level of braking on the flow of work offshore, there will continue to be pressure on price and accordingly the net outflow of work to India and elsewhere will likewise continue. If and when the market improves, we will likely see the commencement of a new wave of contract renegotiations, this time led by supplier rather than customer.

{b} From Jan Durant, Director of IT at Lewis Silkin LLP{/b}

I reckon Microsoft SharePoint is going to rip apart the document management market, especially with the 2010 version which is coming in the Spring. I think their only competitor will be Open Source software, such as Al Fresco.

{b} From Beverley Flynn, Partner in the Commercial and IT Group at Stevens & Bolton LLP{/b}

Following a year of yet more high profile data protection breaches and telephone tapping, the newly appointed Information Commissioner will be keen to set an agenda and demonstrate the ICO’s powers under the Data Protection Act 1998. The consultation ‘Introducing custodial sentences for ‘knowing or reckless misuse of personal data’ – issued by the Ministry of Justice – closes on 7 January 2010 and will hopefully bring with it news that custodial sentences can be be imposed. Whilst the right to impose fines exists, the notably larger fines, eg £3 million for the HSBC data security breaches have been issued by the FSA and in the ‘ What Price Privacy?’ and the ‘ What Price Privacy Now?’ Reports’ of 2006 it was noted that of 22 cases brought only two produced fines amounting to more than £5,000. The introduction of custodial sentences would help give the DPA the teeth and bite which it deserves and enable it to act as more of a deterrent than at present. The number of undertakings given to the ICO, largely by public bodies, as a result of data security breaches would certainly suggest that the legislation is well in need of more sanctions.

{b} From Robin Fry, Partner at Beachcroft LLP{/b}

International carriers such as DHL or UPS may find themselves unexpectedly on the receiving end of criminal prosecutions for storage, ready for onward disposal, of counterfeit software found in undelivered packages. Legal arguments will revolve around whether warehousing of such items, even if not exposed for sale, does breach the Trade Marks Act 1994.

{b} From Paul Gershlick, Principal, on behalf of the Corporate Commercial Group, Commercial/IP/IT Team, Matthew Arnold & Baldwin LLP{/b}

Last year, I predicted that IT projects would take a battering unless they could be financially justified by reducing costs that pay for those projects. With continued belt-tightening, I expect that to continue in 2010, with many non-essential IT projects being deferred.

I also predict that with organisations having fewer staff and each with more on their plates, there will be more incidents of software licences not being kept up-to-date. As pressure mounts on software licensors to hit their revenue targets, bodies like the BSA will have rich pickings and there could be some high-profile revelations of copyright infringement.

On data protection, I expect the next hot topic involving breaches of the seventh principle of the Data Protection Act to revolve around loss or misuse of data caused by dishonest staff. With between one and two in every three British staff (depending on which research you believe) apparently willing to lie on their CVs and so many data breaches caused by acts of individual staff, how long before the next wave of press interest into data loss surrounds theft of databases containing sensitive data by staff who should never have got through basic background checks when applying for their jobs?

{b} From Rob Lancashire, Managing Director, nFlow{/b}

As the use of Smartphones becomes indispensable in legal business, driven by the need for mobile and remote but collaborative working, timely client communication and access to legal systems such as CRM, time recording, document management and practice management, 2010 will see the widespread use of mobile devices such as the BlackBerry for digital dictation in its evolved role as an instructional messaging tool. This is because using enterprise-level workflow-based digital dictation for instructional messaging is flexible, more effective and less time consuming than email-based communication when directing support staff for client related work. This development has already come to the fore in 2009, not just in the legal sector, but across a number of other business sectors too.
Furthermore, whilst the overall economic outlook for 2010 is more positive, firms will remain apprehensive of a rising cost base as output increases, in fear of the touted ‘double dip’ in the economy. This will take the adoption of Cloud Computing-based technologies to critical mass as firms strategically resort to embracing the hosted model, including digital dictation-based instructional messaging solutions. Consuming such solutions from mobile devices will be the logical option, given the growing prevalence of Smartphones in the legal sector. Because these solutions can instantly enhance firms’ agility and response times to business situations, it will represent an easy win towards their drive for productivity and efficiency, not to mention the high rate of return on investment. The capital investment in hosted digital dictation solutions is practically negligible, which makes it an attractive option as cashflow control remains a priority for the foreseeable future for most law firms.

{b} From Jaron Lewis, Partner, Reynolds Porter Chamberlain LLP{/b}

2010 will be the year that our pre-internet libel laws are kicked into shape. Legislation is expected to prevent publishers being sued over archived web content. We will also see a consensus forming over the introduction of more streamlined – and cheaper – procedures for resolving libel disputes. Finally, our libel judges will continue to make clear that those providing the web infrastructure – such as ISPs and search engines – should not be liable for defamatory content, even when they are on notice of a complaint.

{b} From Chris Marsden, Senior Lecturer, University of Essex: {/b}

2010 will be the ‘Year That Three Strikes Strikes Back’ – not that it will be properly implemented anywhere in Europe except France, but the copyright lobby and their captured governments will make serious efforts to force it onto domestic legislative agendas across Europe. That will lead to a consumer backlash led by the surging Pirate Party in the European Parliament and domestically, who will no doubt rouse the European Commission to try to explain exactly what the last-minute Telecoms Package compromise on Three Strikes actually means, particularly in the context of the newly incorporated Charter of Fundamental Rights. Expect the British government to obfuscate on its response, especially as it must pass the Digital Economy Bill before the May 2010 election. That will lead to a proper debate in 2010 about net neutrality, both in Brussels, Washington and eventually even the UK (hopefully reading my new book ‘Net Neutrality’ available free online now!).

The new Tory government will then have to prove that it has some principles by cancelling ID cards and talking tough on personal liberty, ISP liability, state surveillance and digital privacy – how soon it does so will be a key test of their currently half-baked IT policy. Will its pre-election promises result in them reaching for the Sky? 2010 will see further international developments on social network and search co-regulation and net neutrality, led by the resurgent consumer champion Commissioner Reding and the quite radical Obama administration (as I predicted last year). Expect several inevitable changes at the top of Ofcom and the BBC, and growing business as well as consumer pressure on Ofcom to ‘do something’ about our failing broadband competitiveness. Every corporate wage-slave will hate both our grindingly slow recovery from recession (slowest in the G20) and being dragged kicking and screaming to migrate from XP to ‘NOT my idea’ Windows 7.

{b} From David McNamara, Managing Director, Solicitors Own Software:{/b}

{i}More mergers. More virtual firms. More outsourced IT{/i}

Mergers are set to rise as law firms seek efficiency through economies of scale, encourage external investment and plan succession. The recession has kick-started streamlined operations but consolidation with others may be the only road to survival for many.

We’ll see a lot more of a new kind of start-up as entrepreneurial lawyers shun the high overheads of a traditional bricks and mortar practice in favour of the virtual firm, built around remote/home workers.

Finally outsourced IT in all its guises – cloud computing, outsourced infrastructure, support and pay-as-you-go software rental – will gain increasing acceptance.

{b} From Alastair Morrison of Strathclyde University{/b}

In accordance with the ‘prophet of doom’ image which a call for predictions always conjures up in my mind, I decided to voice an easy, obvious but always timely warning: security attacks will increase in number, type and complexity; protect yourselves.

To elaborate and illustrate: renowned security firm Kaspersky claims to be adding 5,000-6,000 records to its malware database every day. Some of the newer and lesser known attack mechanisms include: fake antivirus programs, malware bundled with video codecs, and toolbars with Trojan functionality. We are already seeing ‘the cloud’ being employed by the villains. For example, a program using Google’s AppEngine has recently been used to control a botnet.

Beyond the technology itself, the ‘threat landscape’ has, in the past few years, seen the arrival of organised crime. Attacks from that quarter are likely to be stealthier, more focused and more damaging than traditional internet ‘vandalism’. There is a lucrative underground economy dealing in stolen information and compromised machines, and perhaps the most worrying aspect of the arrival of professional criminals is that their sophistication is such that you might never know that you have been hit!

What can you do? There is plenty of security software around, including much that is free, and even cloud based. Take the time to select and deploy it.

{b} From Jeremy Phillips, IP Consultant, Olswang LLP{/b}

* ‘Three strikes’ proposals, even if enacted, will be shown to be feeble, cosmetic inconveniences. What’s more, downloaders will assert they have a right to two free infringements.
* The Ministry responsible for IP/IT will change its name, its role and its Minister.
* The aggregated figure for victims of Data Protection Act data leak will exceed the population of the UK.
* The government will proclaim that innovation is ‘key’ to the country’s well-being while further restricting its exploitation and taxing it to death.
* Some people will continue to believe in Santa Claus, a flat Earth and the Manchester Manifesto.

{b} From Sandra Potter and Phil Farrelly of Potter Farrelly & Associates: {/b}

2010 is shaping up to be one of the hardest years for the legal profession in decades. Doing more with less will be the on-going mantra, with law firms remaining cautious about raising head counts until some stability starts to show. In the area of litigation, clients will continue to look for ways to push down the costs of moving their matters along and you can expect more clients to look at ways to in-source the grunt work around their matters by hiring their own temporary teams to assist. Hosted software solutions will continue to increase their share of the market and will provide more value to their clients by offering more integrated solutions across a range of discovery and document management offerings.
Trends to watch include the stronger take up of early case assessment products such as ClearWell, FBI and WombatLegal especially in regard to email processing. Expect corporations to get tougher in regard to e-mail use and e-file retention policies with a matching investment in compliance and retrieval tools in the same area. The courts will continue the tend to force a more proportional approach to discovery, especially in regard to what they consider to be unjustified costs of retrieval associated with information of questionable probative value. Clients will find the courts on their side in regard to reducing the time and cost associated with comprehensive discovery demands as long as they have the documented systems in place to back their position.
On the law firm side there will be a continued push to fixed cost services and this will put pressure on the firms to measure their inputs and productivity at the microscopic level – tools that assist in this area will become the ‘must have’ products of 2010. Gadgets will reign supreme however and we will see the iPhone take over from the BlackBerry as the lawyer phone of choice. Coupled with hosted systems, digital pens (with audio recording functions), video conferencing and device independent computing, the iPhone will be the office in your pocket.

{b} From Judith Rauhofer, Editor, Practical Law Company {/b}

1. After similar provisions were withdrawn from the Coroners and Justice Bill, I expect a new attempt to introduce data sharing legislation within the next two years. The prevailing attitude that cross-access to data stored by other (public and private) bodies will be useful to improve public security and the efficiency of public services will inevitable result in someone taking a second bite at the cherry. Hopefully, this time a few more safeguards will be included.
2. The debate over the new ‘cookie’ opt-in requirement under the revised E-Privacy Directive will calm down. Online providers will take a business-as-usual approach by changing their privacy policies so that users’ browser settings imply their consent.
3. Some court in some EU member state will finally refer the question of whether the blanket data retention requirements included in the Data Retention Directive (and implementing domestic laws of the member states) violate the right to privacy under Article 8 ECHR to the European Court of Justice for a preliminary ruling.
4. The government’s position vis-à-vis the responses it received to its second RIPA consultation suggests that it will still want to go ahead with exploring the ways in which existing technology could be employed and new technology could be developed to implement the Interception Modernisation Programme (IMP). Although budget restraints and technical problems are bound to delay new legislation, it is unlikely that these plans will go away even under a new government.
5. The review of the Data Protection Directive may finally gather steam after the publication of the Rand Study commissioned by the ICO and the online consultation initiated by the European Commission. I predict a focus on the harmonisation of member states’ definition of ‘personal data’, the simplification of the regime for cross-border data transfers and (possibly) the extension of a data security breach notification system to all data controllers.
6. Consumer protection aspects of the collection and use of personal data by online service providers will come to the fore. The ICO is already discussing a new Code of Practice for the online collection of personal data and the European Commission is taking first tentative steps in this area. As consumer consent to the collection and processing of their personal data online is largely done via EULA-style privacy policies, the question may be raised whether these should be subject to existing unfair contract terms legislation or whether new legislation is required.

{b} From Peter Sommer, Visiting Professor in the Department of Management at the London School of Economics and also a Visiting Reader, Faculty of Mathematics, Computing and Technology, Open University.{/b}

The {i}Interception Modernisation Program{/i}, or IMP, hopes to address the problems law enforcement and the agencies have as we move away from using analogue telephones as our primary means of communication towards a great variety of Internet-based services all of them with their own protocols and associated difficulties in monitoring. Summer 2009’s attempt by the Home Office to consult on reform was a failure because officials had underestimated the difficulties. Hitherto CSPs have simply provided the authorities, against an appropriate authorisation, with material they already held. Any new scheme will expect them to analyse their customer’s clickstream against legally defined criteria. Does the technology exist? How much will it cost – and who will pay? Who will keep up-to-date with the new protocols? What changes will be required in the Regulation of Investigatory Powers Act 2000 – and what will be the quality of oversight against abuse? The underlying requirements of the fuzz and the spooks won’t go away – and after the election they’ll be lobbying all over again. Let’s hope we have a full public debate about how much power they actually need – and who will fund.

{i}Behavioural Advertising{/i} is important to ISPs and web-vendors because, by examining a customer’s web surfing they can direct highly-focussed advertising at them. It’s the heart of the Google commercial model. Phorm’s attempt to offer services to UK ISPs appears to have foundered on legal issues – privacy management, informed consent, interception, even computer misuse. But the prospects of considerable financial success for those who get the formula right are such that others will try their luck – and the privacy campaigners will be on the alert.

Work currently under way aims to improve and regulate the {i}quality of forensic science{/i} provided to the UK courts. The Law Commission has consulted on admissibility tests in which a judge might act as a gate-keeper and the Forensic Science Regulator is advocating a regime to inhibit labs from using under-tested methodologies. But in going for a one size fits all approach to all branches of forensic science there’s a considerable risk for computer forensics. Rates of change in ICT – with which digital forensics specialists have to keep up as criminals exploit the latest developments – are greater than the speed with which new items of knowledge can be peer-reviewed and tools developed and tested. Difficult discussions will be needed to ensure that the courts are not prevented from considering the digital footprints that may be being created by rapidly evolving new ICT services.

On a related matter, the {i}Ministry of Justice and Legal Services Commission{/i} hope to reduce the cost of legal aid overall, not only in respect of solicitors and barristers, but {i}experts{/i} as well. But with 6-8 month delays in the routine examination of computers seized by the police, we don’t have enough computer forensic experts willing to operate in the publicly-funded sector. If fees for expert witnesses are forcibly reduced, the individuals involved will move across to more lucrative civil and private work, or exit forensics altogether in favour of jobs in computer support and security.

(These predictions are provided with all the authority of one who in 1985 explained to {Ted Nelson:} that his vision of hypertext-linked publicly-accessible databases was too idealistic to succeed in a commercial context.)

{b} From Tracey Stretton, Legal Consultant at Kroll Ontrack{/b}

Given the hyperflow of electronic business communication it is no longer practical to produce evidence in litigation or investigations without the support of technology. The rise of mobile computing and social networking means that less formal business communications will need to be considered and will add to the challenges of e-disclosure. Virtualisation and cloud computing will add to the complexity of the process of identifying relevant evidence.

Specialist technical expertise and technologies will be required to map the data landscape and extract the data required with surgical precision. Early case assessment technologies will become essential to provide lawyers with early visibility of data and shape the selection and filtering process. These technologies will evolve and make it easier for lawyers to prioritise and read the important documents faster with less human effort. This is essential to keep litigation costs in check.’