CONSTITUTIONAL RITES

While negotiating a 10-year, $1.2 billion alliance between global network provider Equant and air transport communications provider SITA, attorney Trevor Nagel concluded that standard contracts no longer work. Because they fail to anticipate rapid changes in pricing, performance and technological advancement, contracts now outlive their usefulness some 18 months after inception. In response, Nagel proposes constitutions — a set of principles to flexibly govern an agreement over the long term. We spoke with Nagel about the challenges — legal and otherwise — facing telecom.

On constitutions: One of the big things that's happening is the very rapid development of new technology and new opportunities around networks, so a lot of my corporate clients are linking their businesses in a truly global fashion. As they become more involved with what happens on their networks, they're no longer simply contracting with a network vendor but creating a strategic alliance. They're starting to see that they want a far closer relationship, one that will evolve over time. We've found that in four or five years, as those arrangements and business strategies and technologies evolve, the existing contracts aren't keeping pace and don't anticipate changes. That's why we're looking at contracts as constitutions governing how people will keep an alliance to anticipate development and optimize opportunities. We're writing constitutions not for Day one, but for Day 1000.

On mergers and acquisitions: I'm not in the camp that believes there will be fewer mergers — when the economy comes back, there will be a wave of mergers, and when people go global, they will look at ways to bring companies together. Individuals taking on the world will find it much easier to do that by taking on someone who can add another component to their business.

On the spectrum debate: The debate over who controls spectrum and how it's regulated is going to remain an issue. We're going to move toward a model where you pay for spectrum as you use it. We're going to see major restructuring of the ways in which technologies are distributed as a result of the 3G experience.

On what's next: With the evolution of some very robust networks that can deal with more than sending voice and data, in the corporate world there are going to be huge opportunities. We're going to see a redefinition of who the major players are — the trend is saying that the players of the last five years are not going to be the players of the next five years. You're going to have to go global — you can't be a major player by staying in just one country.

DOSSIER TREVOR NAGEL

Occupation: Partner and chairman of Technology Practice Group, Shaw Pittman LLC

Place of residence: Washington

Hobbies: Reading, wine and collecting modern art

Current reading: “The True History of the Kelly Gang” by Peter Carey

Favorite Web sites: “I don't feel strongly about any one site — the strength of the Internet is its ubiquity.”

Next project: A complex legal project too new to discuss