AI and Big Data: Why You May Not Want to Let Your SaaS Agreements Auto-Renew Anymore
Recent years have seen a rapid change in the technology, economics and regulations driving the software industry, such as the rise of artificial intelligence (including generative AI, like ChatGPT), the associated explosion of "big data" and the emergence of a patchwork of new privacy laws and data regulations striving to address the implications of these new technologies.
April 16, 2024 at 11:00 AM
10 minute read
Special SectionsIt may be time to renegotiate your agreements with software and technology vendors. Software vendors often structure these agreements with unlimited automatic renewals, under the assumption that customers will often just take the path of least resistance and allow the agreement to continually renew. However, recent years have seen a rapid change in the technology, economics and regulations driving the software industry, such as the rise of artificial intelligence (including generative AI, like ChatGPT), the associated explosion of "big data" and the emergence of a patchwork of new privacy laws and data regulations striving to address the implications of these new technologies. These changes have shifted the value of market expectations for several key provisions in most software/SaaS agreements, and it may be time for your organization to renegotiate these provisions to capture that value. In this article, we'll take a closer look at the changes in the value of market-expectation for provisions including training of AI models using customer data, ownership of customer (and other) data, including use and aggregation of customer data, and potential exposure to and liability for violations of new privacy laws and data security regulations.
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