The Biden Administration has embarked on a significant initiative to bolster innovation and economic development across the country. This initiative is being implemented through the U.S. Department of Commerce’s Economic Development Administration (EDA), which recently announced the designation of 31 Tech Hubs in various regions.
This is the inaugural phase of the new Tech Hubs program, an ambitious economic development initiative that aims to stimulate regional innovation and job creation. The program seeks to enhance a region’s ability to manufacture, commercialize, and deploy technology that will advance American competitiveness on a global scale.
The program is designed to invest directly in high-potential U.S. regions with the goal of transforming them into globally competitive innovation centers. The Tech Hubs are strategically located across 32 states and Puerto Rico, representing a diverse mix of urban and rural regions. These designated hubs will be eligible to compete for $500 million in implementation funding in the program’s next phase.
The Tech Hubs are focused on a wide range of industries, including autonomous systems, quantum computing, biotechnology, precision medicine, clean energy advancement, semiconductor manufacturing, among others. In addition to this, EDA has also awarded 29 Strategy Development Grants (SDG) to help communities significantly increase local coordination and planning activities.
Inflation Impact: Rising Legal Tech Prices
On the other hand, the legal tech industry is grappling with a significant challenge - rising prices. While legal tech prices managed to survive last year’s peak inflationary period, law firms’ technology budgets are currently under considerable strain.
The inflation rate reached a 30-year high in October, as per the Consumer Price Index data released by the U.S. Bureau of Labor Statistics. But it’s not just pressure from legal tech investors that’s fueling price increases. Legal tech providers’ embrace of generative AI also comes at a high cost.
“We saw this with [Technology Assisted Review] early on, [that] any new technology is going to start at a higher price point and then over time technology gets cheaper and better,” said Matt Jackson, Counsel of Data Analytics and Discovery at Sidley Austin.
The expenditure on generative AI technology is not the sole financial consideration for legal tech providers when determining their pricing structure. The development of this technology into products suitable for legal clients necessitates the hiring of additional AI specialists. It is probable that these providers will seek to recover these long-term investments from their customers. “Everyone’s in the market looking for these high-paying roles. These expensive roles … So where do you get that cash from? Where do you get that budget from?” said CJ Webster, founder of C Webster Consulting.
