IT and Tech Sector 2021 perspective
Predicting the future of technology is hard enough in a normal year, considering the pace of development and the unabated innovation driven by the human imagination. However, 2020 has been one of the most challenging years in living memory, as governments, businesses and individuals have had to adapt to the impact of the Covid-19 pandemic, making it particularly difficult to use this year for any future predictions.
Against the backdrop of a global pandemic that has affected the entire population, it may feel trite to focus on developments for a specific sector of the economy.
Nevertheless, as a former CEO of HSBC bank said, "The digital economy is consuming the old economy"  and, to a certain extent, this has translated into a 2020 ‘tech celeration’ and a great move online, which has compressed changes previously anticipated in years, into months.
Even with these unprecedented challenges in sight, the technology and electronic information environment will continue to have a paramount role in all aspects of the economy, and this will present opportunities and challenges for companies in general, and for tech companies and technology start-ups in particular. Not to mention businesses will continue to face increased scrutiny and will need to navigate a climate of increasing risk and regulation of the digital economy.
With the above in mind, we explore below what we believe to be the key global trends in the IT and technology sector that will design the legal outlook for businesses in 2021 and beyond.
Artificial Intelligence and Big-Data
The more time we spend online, the more data we generate and which is quietly being recorded and analysed by big-data and Artificial Intelligence (AI) instruments. Individuals and other entities are already generating a tremendous amount of data every minute. For example, it was estimated that in 2020, the volume of medical data around the world doubled every 73 days, a fact which helped us to develop a vaccine for Covid-19 in a matter of months rather than years, as would have previously been the case.
The more data that is captured and analysed, both in real time and over a sustained period, will result in the emergence of real innovation and new commercial fields.
Furthermore, AI, frequently encountered when discussing analysis tools, isn't a new phenomenon and has become an acronym for many technology models designed to excite customers and investors. AI’s development has been characterised by a series of incremental improvements, punctuated by bursts of real change. Even though scientists have been claiming to be building artificial intelligence for over 50 years, it is only in the last 20 years that we've seen real-world breakthroughs. These have been driven by the arrival of big-data, enabling machines to analyse and learn from sufficiently large datasets, which allows for the development of products ranging from natural speech recognition to autonomous vehicles.
As we move into a new normal, where millions of consumers spend more time at home and less time travelling and interacting with physical monitoring systems, such as Points of Sale and location-based tracking, more human activity will take place online. It will be imperative to track and predict virtual behaviour and to use that data to gain insights into behavioural changes and to make business predictions.
Telecom and Cloud Computing
1. The disruptive effect of tech regulation and how this can catch businesses on the wrong foot is shown by the enactment of the new European Electronic Communications Code ("EECC") . The EECC came into force on 21 December 2020 as part of a series of measures that replaces the 2002 EU telecoms regulatory package, and its setting out of general authorisation conditions for telecoms services.
Under the old rules, over the top services – calls and messages over the internet such as those provided by WhatsApp – were outside the reach of telecoms law, as they were not considered to be regulated electronic communications services.
However, under the new EECC, most over the top services now fall inside the definition of electronic communications services. So, if we are talking about public electronic communications services (essentially, where anyone can sign up), those are subject to certain EECC rules protecting users.
The EECC is designed to enhance the regulatory framework shaped by the ePrivacy Directive – which is expected to be replaced, probably this year, by an ePrivacy Regulation - imposing communications, traffic data and location data rules and confidentiality requirements.
At the moment, Romania has not yet implemented the EECC, but a draft law is currently in public debate and we expect to have full implementation early this year. Please note that the transposition term has already passed, Romania being in default at this point.
2. Another breakthrough to reshape the face of telecoms technology is the much-disputed implementation of 5G technology.
Historically speaking, the evolution from 3G to 4G was incremental and it allowed streaming services to flourish with increased bandwidth, adding a new role of mobile data into our lives. Apparently, the impact of the new 5G technology will be significantly greater, opening a new front for technological developments.
Currently 4G tops out at a theoretical speed of 100 megabits per second (Mbps), whereas 5G tops out at 10 gigabits per second (Gbps). This means 5G is one hundred times faster than the current 4G technology.
But it's not faster download speeds that makes 5G so revolutionary - it’s the new developments that it facilitates. For example:
- 5G can handle more devices at once. A 5G network can support around one million devices for every square kilometre, all connected to the internet at the same time.
- AI machine learning applications relying on real-time access to big-data points.
- Cable and fibre-based networks – with their need for us to be tethered to a particular location – can became redundant.
- Services relying on improved bandwidth and lower latency will become more present in our lives in the future and, as such, 3D video calls will become a normality.
At the moment, Romania has postponed the auctions for 5G network implementation but we are expecting such processes to be resumed in the first part of this year.
3. It is undoubtedly true that over the last decade cloud systems have been a key ingredient in any IT strategy.
The disruptive events and the general lockdowns of recent times have exposed the need for companies to have flexibility and resilience in relation to their data, in order to allow for businesses to continue their activities off-premises, i.e. remotely.
With flexibility and resilience as the guiding principles for future success, organisations will adopt a cloud-first mentality when it comes to building or upgrading their IT infrastructure. However, we expect that very few companies will transfer all their applications and data into the cloud. Such reluctance can be based on the lack of knowledge concerning cloud infrastructures, on the sensitivity of the data or even on effective or prospective privacy threats.
Although there has been little debate over the cloud’s importance for the past several years, the need for cloud services will still represent a game changer in the years to come. Rather than making migration decisions for each IT system, companies will modify or choose systems to fit with a cloud strategy. Security assessments, integration requirements and provider comparisons will be par for the course. Nevertheless, we see cloud infrastructure as a good starting point for post-pandemic rebuilding efforts in the years to come.
Privacy at its finest
The 2020 decision of the European Court of Justice’s in the Schrems II case which rendered the EU-U.S. Privacy Shield invalid has been perceived as a moment of fragmentation of the digital economy in Europe. Until then, the Privacy Shield was a mere instrument to enable personal data transfers from the EU to the U.S. More broadly, the decision has imposed on companies the need to assess the adequacy of their cross-border personal data transfers conducted under controller-processor standard contractual clauses (or "SCCs").
In this new regulatory context, companies, including Romanian companies or companies with activities in Romania, operating international personal data transfers will need to reconsider their cross-border data flows in light of data localisation requirements and the Schrems II decision. In particular, businesses will have to determine whether their European personal data will be adequately protected in jurisdictions that are seen as having strong state security and surveillance laws.
A more recent decision of the Romanian Supreme Court of Justice, although not directly targeting the data privacy sector, shows the increased preoccupation of the local authorities with privacy and the protection of personal life. In this respect, the Supreme Court has decided that opening social media accounts using the details of another person may represent a criminal activity and will be sanctioned accordingly.
With the above in mind, it is very likely we will see more companies starting to restructure operations and to reduce, or even remove, international data transfers. For some companies, this is part of a broader question about how they structure their business, manage their supply chains and operate across different jurisdictions in order to foster greater operational resilience.
eCommerce and Marketplace technologies
As "stay at home" orders lengthened from weeks to months, many consumers were forced to adapt to online shopping, which has produced an unprecedented growth in the field of eCommerce.
Essentially, the incorporation of more new buyers into the online ecosystem has been fuelled by the pandemic lockdowns. From increased overall sales to new opportunities in niches previously untapped by entrepreneurs, eCommerce in 2021 will continue to move forward in ways that, pre-pandemic, would have seemed impossible.
However, a word that has been on everybody’s lips lately is "user experience" and 2020 was all about delivering the best possible experience regardless of whether we were referring to customer, commerce or product. But why will this topic still be on the agenda in 2021? Mostly because there is a lot of room for improvement. The emerging economy needs to keep up with the eCommerce trends to cut through complexity, be visible and attract customers.
The question in 2021 will no longer be "should I put my business online?" but "when should I do it?". And the answer is fairly simple - if you are not online, you may very well be missing out. Luckily, it is better to be there late than not at all and, fortunately, there are plenty of ways to get your business online in a fast and reliable way with turnkey solutions.
In 2021, we will continue to see companies switching their business to fully digital and there is no doubt that 2021 will be a profitable year for digitally native merchants.
However, going online will only be the first step in business transformation. Even though people tend to shop online more and more, expectations of the shopping experience are rising. At the moment, creating a website and selling products online is simply not enough.
Based on existing studies, customers spend more time e-shopping when their experience is personalised. In order to deliver a personalised experience, and present relevant offers to your customers, it is important to gather as much information about them as possible. This will be a very challenging task in the coming years considering the increasing preoccupation of customers, as well as the authorities, in protecting at the highest levels the personal data and privacy of individuals in the electronic environment.
Luckily, for the moment, most of the online shoppers are comfortable with sharing their personal information with a brand, if it benefits their shopping experience. However, in the near future, merchants will also need to consider other ways to collect (more) data about customers. For instance, if they are not already taking on a D2C approach, merchants could consider it. Gamification is another strategy, where businesses can run a competition that requires customers to provide more info about themselves. Or one could simply offer customers a discount if they complete a short survey.
Low code/ no code technologies
Low-code and no-code technologies are changing the way teams and businesses organise themselves.
Digital business acceleration, enhanced by the rapid adoption of work-from-home solutions in the pandemic context, is putting pressure on IT leaders to dramatically increase application delivery speed and time to value. The increased demand for custom software solutions in support of digital transformation has amplified the emergence of developers outside the IT sector which, in turn, has influenced the rise in low-code/no-code platforms and solutions.
Although low-code technologies are not a new thing on the market, existing for over a decade, low-code app development has become increasingly popular in 2020 and the rapid adoption of low-code is only expected to increase. Low-code will become mainstream in 2021 with 75% of development shops adopting this platform, according to Forrester's 2021 predictions for software development. This shift is due in part to the new working environment and product demands caused by the COVID-19 crisis.
Forrester analysts found that "enterprises that embraced low-code platforms, digital process automation, and collaborative work management reacted faster and more effectively than firms relying only on traditional development".
Gartner research finds, on average, 41% of employees outside of IT – or business technologists – customise or build data or technology solutions. Gartner predicts that half of all new low-code clients will come from business buyers that are outside the IT sector by the end of 2025, too.
"The economic consequences of the COVID-19 pandemic have validated the low-code value proposition" said Mr Fabrizio Biscotti, research vice president at Gartner. "Low-code capabilities that support remote work function, such as digital forms and workflow automation, will be offered with more elastic pricing since they will be required to keep the lights running."
Moreover, currently all major SaaS vendors provide capabilities that incorporate low-code development technologies. As SaaS grows in popularity, and these vendors’ platforms are increasingly adopted, the low-code market is likely to see unprecedented growth in 2021.
Additionally, business technologists want to create and execute their own ideas to drive more automation across their business applications and workflows. The needs of business-driven automation will be one of the top drivers for low-code adoption through the next few years.
EdTech – the next level e-learning
2020 will be remembered as the year when social distancing changed the landscape of education.
The pandemic has not just changed the way students are educated, but it has ultimately forced EdTech to up its game very quickly.
The general lockdown in 2020 has forced thousands of schools, and millions of teachers and learners, to switch to remote classes almost overnight. Thankfully, EdTech has made things easier, moving traditional paper-and-pen teaching methods to online.
Any predictions we can make about educational technology trends for 2021 must take this into account: the first few months of the year, at least, will be more of the same but, this time, with the added gift of experience. Although, at least in Romania, face-to-face learning has been reinstated in schools, it is debatable how this will evolve in the long run.
Most people will agree that schools were unprepared for such a large-scale shift and that, while using technology to support learning can be a new and exciting opportunity, a forced switch without an adequate transition period was traumatic for everyone.
Making education accessible to all is a problem that has acquired even more nuances in the age of coronavirus. Accessibility is not just about having an available videocall platform. In this respect, 2020 has created a significant gap between those who have easy access to technology and those who do not.
Furthermore, in recent years, the use of video-assisted learning has become more and more popular in classrooms. This trend is also booming in distance learning conditions, where students learn through computer screens. Videos, especially animated videos, are extremely beneficial to enrich lessons and make content comprehensible. It improves students’ outcomes and reduces teachers’ workload.
The Distributed Ledger Technology (DLT) from blockchain will also bring many benefits to education, especially in terms of data storage. Every time new data is added, it adds another “block” to the system, so the storage is technically limitless. Simultaneously, the data will be encrypted and distributed across multiple computers in the system. In this way, the blockchain technology may answer the problems of authentication, scale and fraud prevention.
Nevertheless, a trend we are expecting to grow in 2021 is AI-enabled adaptive learning. Adaptive learning is a high-tech form of personalised education.
Thanks to AI, digital learning interfaces can adapt to students' needs in real time, providing the lessons and exercises that are needed to fill in knowledge gaps and reinforce concepts, all at the level of the individual student.
Such automated, intelligent tutoring systems are not new, having been on the rise for a number of years, with the first "teaching machine" being created in 1924. But it's only more recently that processing power - both in the cloud and on local devices - has become powerful enough to employ AI for this purpose, unlocking unlimited possibilities for personalisation.
From AI-powered learning to eLearning and more, for kindergarten and adult learning, many of these trends are poised to disrupt the field of education as we know it, hopefully for the better. And it’s only the beginning.
 “Warning lights are flashing for Big Tech as they did for banks”, John Flint, FT, 29 November 2020.
 EU Directive 2018/1972 of the European Parliament and of the Council of 11 December 2018 establishing the European Electronic Communications Code.