Tech & Sourcing @ Morgan Lewis

In an era defined by economic volatility, supply chain disruptions, rapid technological change, and geopolitical risk, outsourcing remains an attractive strategy for businesses seeking efficiency and scalability. At the same time, uncertainty has fundamentally changed what clients expect from their outsourcing agreements. Rigid, long-term contracts that assume stable market conditions are increasingly misaligned with business reality.

ISG’s latest index highlights a technology services and software market that is increasingly defined by cloud momentum and AI-driven investment shifts. While headline growth remains strong, the underlying dynamics point to a more selective and strategic buying environment as enterprises head into 2026.

As demand for data-intensive and AI-driven workloads continues to grow, customers are increasingly encountering constraints on cloud compute resources—particularly specialized processors and region-specific capacity. These market dynamics raise a fundamental question for customers and their advisors: will the promised compute capacity actually be available when it is needed?

As the sports industry looks ahead to 2026, sponsorship agreements are becoming more complex, more strategic, and more closely scrutinized. We sat down with Doneld “Don” Shelkey, a leading sports sponsorship and commercial agreements lawyer at our firm, to discuss what he’s seeing in the market and what sponsors and rights holders should be thinking about now.

As AI continues to reshape technology transactions, deal lawyers have been compelled to revisit longstanding allocations of risk, revisit boilerplate, and develop new contracting mechanics to address novel uncertainty. While the core goals of technology deals remain the same—facilitating commercial outcomes and protecting the business—AI introduces distinctive pressure points across intellectual property, data, regulatory exposure, and liability frameworks.

As technology transactions continue to evolve rapidly, staying ahead of trends, innovations, and regulatory shifts is crucial. Join our Tech & Sourcing Webinar Series on January 22 at 12:00 pm ET/11:00 am CT for an insightful discussion on Tech Transactions: The Year Ahead. This session, featuring Doneld G. Shelkey, Marina G. Aronchik, and A. Benjamin Klaber, will delve into developments in artificial intelligence, data-driven deals, and new sourcing models, providing key insights to help navigate the changing landscape in 2026.

Global capability centers have become a central component of many companies’ technology and shared services strategies. Unlike traditional outsourcing, GCCs allow companies to retain direct control over personnel, intellectual property, and delivery priorities—with this control, however, comes a significantly different legal risk profile.

As aerospace and defense programs become increasingly reliant on complex, multitiered supply chains and emerging technologies, disputes over intellectual property, supply, pricing, and performance are on the rise. To better understand the litigation landscape we spoke with Michelle Pector, a partner in our Houston office. Michelle is a seasoned trial lawyer and trusted counselor who serves as co-chair of the firm’s aerospace and defense industry team and leader of the energy litigation practice.

As companies expand their use of artificial intelligence, copyright law has become a central area of risk and uncertainty. Building on a recent Tech Marathon webinar presented by Morgan Lewis, we highlight key takeaways from recent court decisions testing fair use in AI training as well as legislative proposals on copyright disclosure and digital replicas. The landscape is shifting quickly, and technology lawyers should be prepared to help clients evaluate AI-related rights and manage risks in transactions.

Clauses dealing with intellectual property (IP) rights in commercial agreements can present nuanced challenges, particularly when they relate to information exchange. Two such clauses that often surface in technology contracts are residuals clauses and affirmative feedback licenses. While both relate to information shared during the course of a commercial relationship, they serve very different purposes and have distinct implications for IP ownership, confidentiality, and future use.