Research Handbook on Digital Transformations
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Research Handbook on Digital Transformations

Edited by F. Xavier Olleros and Majlinda Zhegu

The digital transition of our economies is now entering a phase of broad and deep societal impact. While there is one overall transition, there are many different sectoral transformations, from health and legal services to tax reports and taxi rides, as well as a rising number of transversal trends and policy issues, from widespread precarious employment and privacy concerns to market monopoly and cybercrime. They all are fertile ground for researchers, as established laws and regulations, organizational structures, business models, value networks and workflow routines are contested and displaced by newer alternatives. This Research Handbook offers a rich and interdisciplinary synthesis of some of the current thinking on the digital transformations underway.
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Chapter 18: Innovation policy for cloud-computing contracts

John M. Newman


Like any truly disruptive technological leap that alters real-space behaviour, the shift to cloud computing carries with it implications for the design and implementation of legal systems. This chapter explores, with a focus on choice of law and contract law, how legal institutions can facilitate the diffusion of cloud services. It proceeds in three parts. First, it relates the results of a new survey of cloud service contracts. The survey shows that choice-of-law provisions in cloud contracts have become ubiquitous, overwhelmingly favour US over non-US jurisdictions, and heavily favour California over other US states. Second, the chapter offers normative suggestions, based on analogous Internet-related jurisprudence, for how choice-of-law analyses should proceed in the cloud context. Third, the chapter analyses the future of the cloud. Two alternative paths present themselves: (1) the cloud may continue to be delivered by a thick core of large providers, or (2) by leveraging blockchain technology, the cloud may shift to a distributed model. This decentralized cloud would be likely to rely heavily on smart contracts –replacing choice of law with ‘choice of code’ and (via self-enforcement mechanisms) rendering much of traditional contract law obsolete. The chapter concludes by suggesting extralegal systems to address the gaps left by this obsolescence.

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