What’s Happening?

• Sector-focused lawyers from Hogan Lovells are attending CES 2023.

Why?

• CES is where technological change meets business model evolution.

What’s that have to do with law and lawyers?

• Government Policy – laws on the books and regulations that may develop – defines much of the business environment, especially where technology and business models are changing.

What we do:

• We help clients make calculated choices about their future actions.
• We work at the intersection of government policy change, technological development and business model evolution.

How’s that different?

• At Hogan Lovells we focus on where things are going not merely where the law is.

What will we do at CES?

• Look toward the future with our clients.

Check out our thoughts by sector below:

• Automotive
• Advanced Aviation
• Communications, Internet and Media
• Consumer
• Government Relations
• Sports
• Technology
• Transport and Logistics

Automotive

CES is now the most interesting auto show in North America.  It is THE place to be.

• Sustainability:  The move to electric vehicles from internal combustion engines is the dominant focus of the global auto industry.  Sustainability in the supply chain is a trending issue, too.  CES should have plenty of interesting announcements.

• Supply Chains – batteries:  Adequate supply chains are not yet in place for batteries at the scale needed for the industry’s rapid transition.  Geopolitical issues and strategic competition among nations regarding batteries and component materials are accelerating.  Many CES attendees will talk about battery technology, sourcing and where production will occur and when.

• Supply Chains – semiconductors: Constrained supply of semiconductors hit the auto industry hard.  As with batteries, geopolitical issues and increased demand for semiconductors for software heavy vehicles mean continued focus on the supply chain.

• Driver Assistance:  We expect new features will be revealed.

• Collaboration, Connectivity, New Revenue:  The vehicle is no longer an island.  Automakers and other technology developers are collaborating and innovating toward new features and new revenue sources.

• Transportation Services:  The automotive sector is a critical component of next generation infrastructure such as smart cities.  Automotive companies will continue to see the bigger picture and blur the borderlines surrounding transportation services as they seek to take on a central role in future schemes of living mobility.

Advanced Aviation

Advanced aviation technologies, including commercial drones and e-VTOL passenger-carrying aircraft, are taking off (no pun intended).  CES will bring together industry and government to discuss how these industries are bringing value around the world, and to celebrate leading Women in Emerging Aviation Technologies. 

• Societal Benefits: Commercial drone operations are bringing countless safety, sustainability and efficiency benefits to the public, whether delivering medicines, PPE, and day-to-day commercial products; performing post-natural disaster inspections and assessments; enhancing search and rescue missions; enhancing worker safety; and much more. 

• Tech Surpassing Policy: Technology has moved quickly forward, but policies have lagged behind.  2023 will be a critical year for legislative and policy development.   We expect CES to highlight new technologies in this sector, as well as the dynamic legal and policy environment surrounding safety and security in advanced aviation technologies.

• Drone Security: With the growth of the drone industry, policymakers have increasingly expressed security concerns.  Here too, policies have lagged behind the technology.  We expect to see legislators focus on this issue in 2023.

• Advanced Air Mobility (AAM): AAM operations using new and innovative e-VTOL aircraft will revolutionize air travel by moving people and cargo more quickly, safely, sustainably, efficiently and quietly than traditional crewed aircraft.  AAM can also provide access and connectivity to many underserved communities and individuals with disabilities.  We look forward to hearing from AAM industry stakeholders on the opportunities and challenges to commercialization of this revolutionary technology. 

Communications, Internet and Media

CES has long presaged where the communications, media and tech industries are going, especially with respect to retail consumers.  This year will be no exception and these new consumer products and services will ultimately drive changes in communications and tech laws and policies on spectrum, privacy and consumer protection.  Notable technology on display includes:

• Broadband: The Coronavirus pandemic laid bare the wide opportunity gap between those with reliable broadband and those without.  Policymakers in many countries (developed and under-developed) have significantly increased their subsidies for extending the coverage of broadband networks and making broadband more affordable. At CES, we will see or hear about some of the recently touted network technologies for expanding broadband coverage in less populated or hard-to-reach areas, including Gigabit fixed wireless, smaller sized low-earth orbit satellites, and high altitude platforms.  We also expect CES to highlight some new satellite companies that aim to provide broadband directly to the smartphones currently in circulation.

• Technology Using Broadband: The latest technologies for enjoying broadband, including the newest Internet-capable laptops, tablets, home entertainment and communication network systems, handsets, watches, automobile telematics units, clothing, and jewelry, will certainly be on display. We expect the cost of such consumer equipment to range from very inexpensive smartphones to luxury home entertainment and communication network systems.

• Virtual and Augmented Reality Applications and Devices. Extended reality technologies, including augmented reality (“AR”), virtual reality (“VR”), and mixed reality applications, are poised for growth as access to 5G becomes more widespread. Extended reality already enhances many consumer experiences. However, due to infrastructure limitations and inconsistent availability of bandwidth and computing resources, the most advanced AR and VR applications have thus far been restricted to enterprise and military settings. CES will show us how these technologies will be introduced into the consumer sector.

• 5G Enables AR and VR:  Today, maturing 5G networks provide the necessary bandwidth and low latency connectivity needed to support a wider range of consumer AR and VR products. Several innovative products will be featured at CES, including AR and VR headsets for everything from gaming to the delivery of medical care, tunable lens inserts to allow myopic individuals to use headsets without prescription lenses, a tactical graphic device for the visually impaired, a haptic VR controller in the form of a light-weight gaming glove, and new lightweight consumer focused smart glasses that provide language translation, directions, and messaging among other services. As 5G coverage becomes more pervasive and with the advent of 6G, which will provide even greater data capacity and lower latency, the innovation and potential use cases will continue to multiply.

• Private Networks and IoT Devices. 5G has been a big buzzword in tech for several years, but many visions for our 5G future remain unrealized. 2023 may be the year 5G finally takes off, spurred by private networks, industrial sensors, and the Internet of Things (IoT).  We expect to see a number of innovative 5G-supported IoT technologies under development that can be used to support precision agriculture, reduce greenhouse gases, improve health care outcomes, help business better monitor their equipment in the field, and revive manufacturing.  These business use cases may ultimately be the applications that spur 5G network deployment by allowing mobile network operators to increase their returns on connectivity services.

Consumer

With CES just days away, we are eagerly looking forward to seeing what the industry thinks the next consumer device “must haves” will be.  Some of the  clear trends for the future of consumer electronic devices, trends we expect to hear more about at the show are.

• Smart: Electronic devices will continue to get smarter. This trend is not new but it is accelerating.  Legal challenges are accelerating too: permitted and restricted uses of data, cybersecurity, including liability for artificial intelligence, bias and discrimination and ownership.
• Sustainable:  Exhibitors will focus not only on the new features of their products, but also on recent advances in sustainability. Those advances will not just be around reduced energy consumption of the new generation of appliances, improved manufacturing processes based on green energy and recycled materials or innovative products like solar-powered remote controls, which have the potential to save millions of batteries.
• Regulations on Sustainability:  The sustainability trend is heavily influenced by regulatory requirements.  Legislators across the globe seek to create legal frameworks to promote sustainable practices.  Those new regulations can have a massive impact on consumer products.  An excellent example is new EU battery regulations, which will require that devices be designed so that batteries can be removed, replaced and recycled.  
• Connected: New high speed connectivity standards allow for data transfer rates that had previously been unheard of and that enable exciting new uses, such as data intensive services like VR applications. These new connectivity standards also bring new legal challenges for the industry. One example are increasing numbers of patent disputes on license fees for 5G or Wi-Fi 6 patents that several companies from the consumer industry are currently facing.

Government Relations and Public Affairs

CES will kick off just two days after the 118th U.S. Congress is sworn-in on January 3.  While there is much uncertainty with how a Republican-led House and Democratic Senate will co-exist, let alone legislate, one thing is certain: we expect tech policy to dominate Washington over the coming year. 

• Legislation:  Both parties have a long “wish-list” of tech-focused legislation that they are eager to roll out next congress.  While some policy areas like content moderation are expected to break down along familiar partisan lines, legislation addressing privacy, kids online safety, and even competition and antitrust issues may enjoy bipartisan support, even in an increasingly partisan Congress.  

• Investigations: We expect both parties to undertake extensive oversight activities.  House Republicans have already indicated that they plan to investigate alleged anti-conservative bias in the tech industry and ESG policies.  Democrats are eager to use investigations to push the industry to do more to combat hate-speech and misinformation online.  We expect both parties to carefully scrutinize the tech industry’s privacy policies, especially in areas like healthcare.  Many of these investigations are likely to be hyper-partisan affairs that have the potential to put the tech industry under conflicting pressures from the Republican House and Democratic Senate. 
• Regulatory: A divided Congress will likely make legislative victories hard to come by especially with the 2024 presidential election right around the corner. We expect the Biden Administration to continue its ambitious tech regulatory approach led by agencies like the Federal Trade Commission, especially in areas like privacy, competition, and consumer protection.  The industry is also facing a growing and diverse body of state laws and regulations. 

Sports

At CES, innovators from around the world will showcase new technologies in eSports, sports betting, non-fungible tokens (NFTs), sports technologies, and virtual/augmented realities.

• Sports betting:  New gaming products, platforms and online payment systems will be showcased.  Companies will need to understand the legal implications of these new technologies in conjunction with local gaming regulations.

• NFT’s:  Professional sports teams are exploring the possibility of tickets becoming digital tokens, as a way of upgrading customer experience. NFTs may also be used for digital trading cards, memorabilia and sports moments.

• Smart technologies in stadiums: Efforts to enhance fan experience involve tablets, instant concession ordering, fan controlled screens, wearable technologies, and social networking applications.  These technologies create new issues around data privacy and intellectual property.

• Immersive media: Virtual and augmented reality dramatically change how fans experience sports. Privacy and intellectual property will be top of mind as VR/AR companies navigate the challenges of working in a space where the technology is often moving faster than the law. 

• Blockchain: Blockchain technology has the power to change the business model of eSports and event ticketing.

Technology

• “Human Security”:  Human Security is the theme of CES this year. The UN human security approach calls for “people-centered, comprehensive, context-specific and prevention-oriented responses that strengthen the protection and empowerment of all people.” This concept identifies pillars of security including food, access to health care, personal income, environmental protection, personal safety, community security and political freedom. There are innumerable ways for technological innovation to address this human security approach. 

The focus here is the impact of technology on people rather than on the technology itself.  This means emphasizing what technology enables not merely on how it functions. We look forward to seeing how technology companies address this theme at CES.

• Collaborations among technology companies: Growth in technology collaborations are a longer-term trend, as companies have looked for opportunities to expand into new markets and deploy their industry-specific know-how and technology in new ways. The global pandemic amplified that trend. 

The work of many of these collaborations induced by the pandemic—in semiconductors, VR, software, and other sectors—will start to become available as actual products. We are excited to see how this work is brought to the market.

• IOT’s impact on our daily lives:  Innovations around the  “internet of things” (including sensors, data collection, data analysis, and AI) will certainly change our daily lives but we do not know exactly how.

In some senses, IOT is already ubiquitous – in our home appliances, automobiles, and factory floors. Devices communicate, follow instructions, and collect a lot of data.  We expect to see examples of continued growth and improvement in connected devices.

Transport and Logistics

Technologies such as automation, artificial intelligence, digitalization and energy transition, are converging with geopolitical events and an increased focus on Environmental, Social and Governance issues to transform the transport and logistics sector. We expect to see innovative responses including significant developments in the following areas:

• Sustainable Logistics: A contraction of the logistics industry will be managed and balanced by companies exploring innovative software, hydrogen, and other solutions to achieve decarbonization across the movement of goods from first to last mile.

• Adaption of Automation Technology: While autonomous vehicles have not progressed to Level 5 autonomy as rapidly as anticipated, in part due to regulatory and public acceptance challenges, companies will continue to adapt and identify uses for automated technology in the transport and logistics space.

• Smart Mobility: Increased integration of all modes of transportation via wireless communications, including MaaS technology demanded by avid consumers, and the new applications for the resulting real-time data analytics and machine learning, will play an increasingly significant role in the pursuit of cleaner, safer and more efficient transportation and logistics.

Authored by Patrick Ayad, Lance Bultena, Phoebe Wilkinson, Joanne Rotondi, Will Yavinsky, Sebastian Polly, Ari Fitzgerald, Lisa Ellman, Henrik Lehment, Kelly Tubman Hardy, Aaron Cutler, Ches Garrison, Kelly Ann Shaw, John Brockland, Craig Umbaugh, Michele Farquhar, and Matt Eisler.