Department of Justice to Publish Final Rule for Digital Accessibility, Advancing the ADA's Commitment to Equal Rights for All

Rhea-AI Summary

AudioEye, Inc. (AEYE) supports the Department of Justice's new regulations under the ADA, with an estimated $17 billion in implementation costs over three years and $2 billion in annual recurring costs.

Insights

Market Research Analyst

The introduction of stringent accessibility regulations by the Department of Justice under Title II of the ADA presents a significant market opportunity for companies like AudioEye that specialize in web and mobile app accessibility. The mandated adherence to the WCAG 2.1 Level AA standards for all state and local government entities, including educational institutions, implies a substantial increase in demand for services that ensure digital platforms are accessible to individuals with disabilities.

Considering the estimated $17 billion in implementation costs over the initial three-year period and $2 billion in annual recurring costs thereafter, businesses in the digital accessibility industry are likely to experience a surge in revenue. This will be particularly true for market leaders like AudioEye, which has already established a significant customer base within government entities. The scale of the projected costs suggests that the market for accessibility services will not only expand but also become more competitive as new players aim to capitalize on the growing demand.

From a market perspective, the compliance timeline stratified by government entity size indicates a staggered demand pattern, with larger entities requiring services earlier. This allows for strategic planning and resource allocation by providers to meet the anticipated needs. The inclusion of private companies that operate government-provided services further widens the potential customer base.

Legal Expert

The ADA's expansion to include specific digital accessibility requirements signifies a legal shift towards greater inclusivity. The Web Content Accessibility Guidelines (WCAG) 2.1 Level AA are now a legal requirement for government-related digital services, which raises the bar for compliance and potentially increases the legal risk for non-compliance. Entities failing to meet these standards within the specified timeframe may face legal repercussions, including lawsuits and fines, which can have material financial impacts.

The implications of this rule extend beyond immediate implementation costs. Entities must consider the long-term need for ongoing compliance, which includes not only the initial technological overhaul but also the continuous monitoring and updating of digital content to maintain accessibility standards. This creates a sustained demand for services like those offered by AudioEye, which can provide both initial solutions and ongoing compliance support.

For investors, the legal mandate for digital accessibility could signal a lower risk profile for companies that provide these services, as the demand is backed by regulatory requirements rather than market forces alone. However, it also suggests the need for vigilance in assessing a provider's ability to scale and adapt to evolving standards, as the legal landscape can change and impact service requirements.

Financial Analyst

The financial implications of the new ADA regulations are multifaceted. For companies like AudioEye, the projected $17 billion market opportunity represents a potential windfall, but it also requires careful financial planning to scale operations effectively. The additional $2 billion in annual recurring costs post-implementation suggests a steady revenue stream for providers that can establish long-term contracts with government entities.

Investors should note that while the opportunity is significant, it is also capital-intensive. The costs associated with scaling up to meet demand, hiring skilled personnel and investing in technology could impact profit margins in the short term. Companies that manage to balance these costs while providing effective solutions are likely to emerge as leaders and could see increased investor interest.

Moreover, the compliance deadlines create a short-term urgency that could benefit first-movers and established players. As government entities rush to meet the compliance dates, they are more likely to turn to reliable providers with a proven track record, potentially driving up the stock prices of these companies. However, investors should also be aware of the long-term sustainability of these gains, as the market may become saturated once initial compliance is achieved.

$17 billion in implementation costs estimated during the first three years with $2 billion in additional annual recurring costs after the initial stage

TUCSON, Ariz., April 9, 2024 /PRNewswire/ -- AudioEye, Inc. (Nasdaq: AEYE) ("AudioEye" or the "Company"), the industry-leading enterprise SaaS accessibility company, announces its support of the Department of Justice's latest regulations under Title II of the Americans with Disabilities Act (ADA), as outlined in the approved rule announced April 8, 2024. The rule adds specific requirements for web and mobile app accessibility, accelerating efforts by state and local government entities to ensure that people with disabilities have equal access to services, programs, and activities, from adoption services to zoning regulation. These new regulations mark a significant step forward in ensuring inclusivity and usability for all.

"This rule represents a historical moment that will have lasting implications in the lives of an often underserved portion of our society. We thrive when every citizen has equal access to information and services and can play an active role in their community," said David Moradi, CEO of AudioEye. "We currently serve over 3,000 government entities, which we believe is the largest number among digital accessibility providers. We are uniquely positioned to meet the expected exponential demand increase with our platform combining the latest in artificial intelligence and human-assisted technology with members from the disability community."

In the Justice Department's press release, Attorney General Merrick B. Garland states, "This final rule marks the Justice Department's latest effort to ensure that no person is denied access to government services, programs, or activities because of a disability." The Justice Department said the rule "will help ensure that people with disabilities have equal access to a full range of government services including critical activities like voting, taking online courses, applying for public benefits, filing taxes and more."

The rule introduces specific technical standards to help ensure digital accessibility, including:

• State and local government entities must follow the Web Content Accessibility Guidelines (WCAG) 2.1, Level AA, as the technical standard, including all public schools, community colleges, and universities.
• Sites and apps built by private companies but provided or made available by a government (such as a public parking app run by a private company) must also adhere to this rule.
• Estimated implementation costs of $17 billion accruing during the first three years (the implementation period) and $2 billion in annual costs over the next seven years.

The timeline for compliance varies based on government size. Government entities with 50,000 or more persons must be compliant within two years of the rule's final publication date, while government entities with fewer than 50,000 persons and special district governments have three years to reach compliance.

About AudioEye
AudioEye exists to ensure the digital future we build is inclusive. By combining the latest AI automation technology with guidance from certified experts and direct input from the disability community, AudioEye helps ensure businesses of all sizes — including over 110,000 customers like Samsung, Calvin Klein, and Samsonite — are accessible and usable. Holding 22 US patents, AudioEye helps companies solve every aspect of digital accessibility with flexible approaches that best meet their needs — from finding and removing barriers to navigating legal compliance to ongoing training, monitoring, and upkeep. Join AudioEye on its mission to eradicate barriers to digital access.

Media Contact
Sierra Thomas
Public Relations
press@audioeye.com 

Investor Contact
Tom Colton or Luke Johnson
Gateway Group, Inc.
AEYE@gateway-grp.com
949-574-3860

 

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SOURCE AudioEye, Inc.

FAQ

What new regulations does AudioEye (AEYE) support under the ADA?

AudioEye (AEYE) supports the Department of Justice's new regulations under Title II of the Americans with Disabilities Act (ADA) for web and mobile app accessibility.

What are the estimated implementation costs for the new regulations supported by AudioEye (AEYE)?

The estimated implementation costs for the new regulations supported by AudioEye (AEYE) are $17 billion over the first three years and $2 billion in annual recurring costs.

What technical standards are introduced by the new regulations supported by AudioEye (AEYE)?

The new regulations introduce the Web Content Accessibility Guidelines (WCAG) 2.1, Level AA, as the technical standard for digital accessibility.

How long do government entities have to comply with the new regulations supported by AudioEye (AEYE)?

Government entities with 50,000 or more persons must be compliant within two years, while those with fewer than 50,000 persons have three years to reach compliance.