2026 Forecast: What’s Ahead in the Digital Sector

It goes without saying that 2026 will see a whirlwind of legal developments in the areas of cybersecurity, data privacy regulation, and artificial intelligence. But which way will those winds blow?

As 2026 kicks off, members of Womble Bond Dickinson’s Digital Solutions Team offer their predictions on what changes could be in store this year:

Data Privacy: The Compliance Storm Intensifies

Enforcement

“State attorneys general and other state agencies are likely to continue taking the lead on regulatory investigations and enforcement actions relating to alleged privacy violations and allegedly unfair or deceptive practices related to consumer data. These efforts are expected to intensify in 2026, as many recently enacted state privacy laws—and their accompanying regulations—have now been fully implemented or will take full effect in 2026.”

• John Gray, WBD Cyber, Privacy and AI Litigation Partner

Children/Teen Data

“As 2026 dawns, U.S. regulators continue to signal privacy and online safety for kids remains a priority. Congress has 19 bi-partisan bills pending to protect kids online, though they face challenges. Beginning in 2026, the knowledge exception under COPPA, which exempts many companies from complying with COPPA if they do not have actual knowledge a user is under 13, is set to be upended by new age assurance state laws called ‘App Store Accountability Acts.’ To comply with age verification, AI tools may increasingly be used while a federal v. state AI law shown down looms. Buckle up! We expect turbulence.”

• Nadia Aram, WBD IP Transactions Attorney

“At the federal level, the FTC has shifted its stated focus to promoting innovation and reducing unnecessary regulatory burdens, but it continues to pursue enforcement actions relating to children’s privacy, in particular.  State legislatures and consumer-protection agencies are also prioritizing children’s privacy and online protection. So, companies that maintain or process children’s data should re-assess their practices and compliance efforts in light of the evolving legal and regulatory landscape.” 

• Tyler Bridegan, WBD Privacy and Cybersecurity Partner

Litigation

“Unless or until the California legislature updates the California Information Privacy Act (CIPA), we expect to see continued waves of demand letters, arbitrations, and class-action lawsuits asserting privacy violations related to website tracking technologies.  We also expect the waves to continue expanding outward, targeting companies outside of California that have might have escaped earlier scrutiny and might be less familiar with California law and litigation.”

• John Gray, WBD Cyber, Privacy and AI Litigation Partner

Digital Advertising/Marketing

“Digital advertising and marketing are inseparable from privacy and AI laws at this point in time in the US, along with the more commonly applicable advertising laws. A patch work of advertising laws, some industry specific, at both the federal and state level paired with as many individual laws relating to privacy and AI brings legal complexity in marketing to new heights. And no, your AI tools, while helpful as tools, are not a panacea to take out the thinking through all of the complexities here or replace your human leads with the marketing acumen and industry knowledge, who probably deserve a raise.”

• Nadia Aram, WBD IP Transactions Attorney

AI and IP: The Next Frontier Takes Shape

Governance/Compliance

“Companies, global and national ones in particular, betting on AI adoption are entering into an uncertain regulatory environment in 2026 and beyond.  Governments are grappling with how to regulate AI innovations and legislative priorities.  Many of the proposed laws and regulations require technical understanding of AI tools and use cases.  A principles-based approach, multi-stakeholder working groups, and iterative policy and procedural frameworks can serve as foundational elements for managing evolving AI risks.  Legal functions will need to understand AI-enabled business processes from a technical standpoint to advise business and management as laws and regulations evolve.”

• Taylor Ey, WBD IP Transactions Partner

Regulation

“As Executive Orders and federal actions continue to press state law preemption and priorities seemingly in contrast to many active state AG offices and legislatures, companies of all sizes will continue to seek stability and predictability. This uncertainty will likely lead to voluntary adoption of compliance frameworks. Many organizations will look to the risk-based concepts of the EU AI Act and those posed by state privacy and AI regulations to set a principles-based anchor, regardless of federal emphasis on clearing a path for AI innovation. Will there be companies that take advantage of the ability to “cut the red tape” and innovate with reduced scrutiny? Most certainly. However, I expect many organizations will continue to build compliance models that emphasize transparency and governance controls to protect reputation, IP, and consumer and customer trust.”

• Tara Cho, WBD Data Privacy & Cybersecurity, Partner; Co-Lead, Digital Solutions Team

“FCC Chairman Brendan Carr is likely to continue to press for the FCC to be the agency that sets federal regulation of AI in an effort to preempt 50 versions of state regulation under the auspices of regulating interstate/international communications. This may lead the FCC to re-evaluate of where it stands on the regulation of data over broadband technology – is it a telecommunications or information service?”

• Carri Bennet, WBD Communications, Technology, and Media Partner

AI & Copyrights

“There currently are 50+ pending lawsuits concerning copyrighted works as training data. We will see more rulings from the trial courts, and likely a ruling from the Third Circuit in the Thomson Reuters v. ROSS case.  These additional rulings will further clarify the legal landscape and may even be sufficiently aligned to provide a stable basis to enable parties to settle more of these disputes.”

• Christian Mammen, Ph.D., WBD AI & IP Litigation Partner

IP Disputes

“More lawsuits by content companies against AI model developers will settle with licenses being granted by the content owners, and a set of prices for training on megabytes of data will normalize.”

• Ted Claypoole, WBD IP Transactions Partner

Deepfakes & Rights of Privacy (Name/Image/Likeness)

“AI will continue to improve to the point where video and still images are indistinguishable from reality.  Particularly in jurisdictions that have not yet enacted updated/expanded protections for name, image, and likeness protection against AI replicas, we may see increased activity that replaces humans in public-facing media.”

• Christian Mammen, Ph.D., WBD AI & IP Litigation Partner

Corporate Transactions

“By the end of 2026, AI technology will begin to make significant impacts on M&A transactions, enhancing due diligence processes and streamlining deal timelines.  We anticipate that AI will enable rapid analysis of financials, legal documents, and market data, ensuring term sheets reflect current market standards with a higher level of precision that is often debated at length as to various “market” positions and differing deal studies.”

• Patrick Strubbe, WBD Corporate/M&A Partner 

AI Sovereignty

“AI sovereignty will become ever more explicit.  As we have previously noted, AI sovereignty is already starting to drive policy decisions.  The White House’s executive orders on the ‘Genesis Mission’ and preemption of AI regulation are both also aimed at a conception of AI sovereignty for the U.S.”

• Christian Mammen, Ph.D., WBD AI & IP Litigation Partner

Data Center Development

“Data center development will continue at a feverish pace with developers and end users continuing to scramble for new sites with access or a pathway to sufficient power.  As we near the end of the boom in Northern Virginia, developers will look to North Carolina, South Carolina, Tennessee and other Southeastern states to locate their new facilities. Developers, state governments and utilities will continue to grapple with how to bring additional power generation online quickly enough to meet the demand and we may start to see changes to the state utility frameworks to accommodate the surging demand.”

• Whit McGreevy, WBD Economic Development Partner  

   

Telecommunications: Regulations in Flux

“Consumers’ Research continues to be a thorn in the FCC’s side, with renewed challenges to the FCC’s Universal Service mechanisms. Following its 2025 Supreme Court loss focused on the FCC’s High-Cost Support mechanisms, CR this time assaults the $3.2 billion Schools and Libraries (“E-Rate”) and $825 million Rural Health Care Programs. The FCC, having already ignored CR’s initial challenge filed with the agency this fall, spends 2026 again defending important and popular universal service programs on the unfavorable terrain of the Fifth Circuit. Meanwhile, market-distorting carrier assessments that fund these programs continue to climb, with neither Congress nor the FCC able to settle on a path to reform.”

• Richard Cameron, WBD Communications, Technology, and Media Partner

Cybersecurity: Rising Threats, Higher Stakes

Federal Standards

“The federal Cybersecurity and Infrastructure Security Agency (CISA) will adopt new cyber incident reporting requirements for critical infrastructure resulting in the imposition of burdensome cyber-incident and ransomware-payment reporting obligations affecting hundreds of thousands of entities across the 16 critical infrastructure sectors.”

• Marjorie Spivak, WBD Communications, Technology, and Media Partner

Cyberattacks

“As prices for stolen personal data continue to fall on the black market, companies will continue to see more invoice fraud attacks.  All companies should institute a procedure for double checking vendor requests to change bank accounts receiving direct deposits.  This is the best way to stop losses and the best way to win a claim when the money is lost to fraudsters.”

• Ted Claypoole, WBD IP Transactions Partner

About WBD’s Digital Solutions Team - The pace of digital transformation continues to accelerate, influencing every area of today’s business environment. Our Digital Solutions Team helps organizations navigate this landscape, offering integrated support across compliance, transactional, litigation, and intellectual property matters.