Contracting for Website Development

These days, a website is all but a necessity for most businesses, yet few people have the time or technical skill needed to create their own.  Consequently, many businesses hire these tasks out to web design firms.  Perhaps the most important legal aspect of this process is writing and negotiating the initial contract for these services.  Not all business websites are equal, however – some are simple, no-frills adjuncts to traditional brick-and-mortar businesses, while others are major capital investments for web-based companies.  In either case, business owners who know what to ask for will be those who get the best value for their investment.

In some ways, hiring someone to build a website is like hiring any other sort of contractor. Most contracts for website development will include design specifications, a schedule for milestone delivery times, and various project controls.  A common area of negotiation is procedures for the customer to approve or disapprove deliverables.  Developers will generally try to limit such procedures, while customers will try to create leeway to make changes.  Subjective website elements such as design and layout are often conflict-prone, especially when the customer requests changes late in development.  Creating clear, mutually agreeable provisions in this area can be difficult, but it can also help to prevent conflicts later on.

Another aspect of website design contracting that must be carefully negotiated is which party will ultimately own the intellectual property created. Some customers may view the process as a simple “work for hire” transaction, wherein they will own the website in its entirety once it is created. Developers, on the other hand, may want to protect their right to reuse programming or design elements of the site for future clients. The outcome of these kinds of negotiations will depend on several factors, including the sophistication of the website, the amount of branded or customer-provided content used in the site, and the respective parties’ bargaining leverage.

Since a professionally designed website can represent a valuable investment for some businesses, it pays to be careful when setting out.  Most web design companies will have a standardized service contract, which some businesses will happily accept with few changes.  Other, more sophisticated operations may prefer to draft their own contract with the assistance of their business attorney. But as with any type of contract, it is usually wisest to review and negotiate terms carefully.