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International Journal of Construction


Education and Research
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Building Information Modeling and


Potential Legal Issues
a

Douglas B. Arensman M.S. & Mehmet E. Ozbek Ph.D.

Colorado State University, Fort Collins, Colorado


Published online: 07 May 2012.

To cite this article: Douglas B. Arensman M.S. & Mehmet E. Ozbek Ph.D. (2012) Building Information
Modeling and Potential Legal Issues, International Journal of Construction Education and Research,
8:2, 146-156, DOI: 10.1080/15578771.2011.617808
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International Journal of Construction Education and Research, 8:146156, 2012


Copyright # Associated Schools of Construction
ISSN: 1557-8771 print=1550-3984 online
DOI: 10.1080/15578771.2011.617808

Building Information Modeling and


Potential Legal Issues
DOUGLAS B. ARENSMAN, M.S. AND
MEHMET E. OZBEK, PH.D.
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Colorado State University, Fort Collins, Colorado


Building Information Modeling (BIM) is an emerging concept within the construction industry. With the increase in the utilization of BIM, it has become clear that
there is some legal uncertainty in dealing with this technology. While the technology
is rapidly growing in sophistication, these legal uncertainties may be acting as obstacles on BIMs wider adoption. It is important that the potential users of BIM
become aware of the potential legal issues and how these issues are evolving within
the companies that have been using BIM to make better informed decisions. Within
this context, this articles purpose is to: (i) provide an overview of the potential legal
issues associated with BIM and (ii) present the perspectives of companies (that have
been involved in projects using BIM) on those potential legal issues and their experiences in dealing with those issues as gathered through semi-structured interviews.
The interviews included ten professionals representing different entities in the construction industry that are primarily affected by the BIM-related potential legal
issues, architects, owners, and contractors. The potential legal issues that were investigated are model ownership, right to rely, shifting of risk, standard of care, and
BIM compensation.
Keywords building information modeling, legal issues, standard of care

Introduction
Building Information Modeling (BIM) is an approach to generate and manage building data throughout its lifecycle. BIM enables the continuous and immediate availability of information with respect to project design scope, schedule, and cost
(Forbes & Ahmed, 2010). The purpose of BIM is to provide a central repository
for all of the information that pertains to a building, which can be used by all project
members during the construction phase and by the owner during the occupancy
phase (Holness, 2006).
BIM uses the latest generation of Object Oriented Computer Aided Design
(OOCAD) systems, in which all of the design elements are stored in a single project
database that has all of the information about the structure. A building information
model can provide a single and consistent source for all of the information about the
building it represents (Howell & Batcheler, 2005). Part of the appeal of BIM is that it

Address correspondence to Mehmet E. Ozbek, Ph.D., Construction Management,


Guggenheim Hall, Campus Delivery 1584, Colorado State University, Fort Collins, CO
80523. E-mail: mehmet.ozbek@colostate.edu

146

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147

enables the project participants to identify errors and omissions on the computer
screen before they actually go to the field (Brodsky, 2006).
BIM has been gaining adoption in the construction industry. Increasingly, both
private and public owners are requesting=requiring the utilization of BIM in their
projects. For example, the United States General Service Administration has been
requiring BIM for all of its major projects since fiscal year 2007 (GSA, 2011). Users
of BIM have reported to have less conflicts and better coordination on projects
(Florkowski, 2007).

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Problem Statement
While BIM promises reduction in costs and errors and thus greater productivity in
construction projects, it has also generated large amounts of uncertainty, particularly in the legal area (Dal Gallo & Lee, 2008; Larson & Golden, 2008). Construction contract law is based on many years of precedents; numerous cases have been
tried in different courts and all those precedents give participants some measure of
certainty in how a particular dispute will be resolved. The introduction of BIM,
which is an evolutionary step up from CAD programs, brings a new work process
to the construction industry, one that has not been tested in a courtroom enough
to establish case laws. In addition, contracts have not necessarily kept pace with
the technology, nor has legal liability or responsibility.

Purpose and Scope


This papers purpose is to: (i) provide an overview of the potential legal issues associated with BIM and (ii) present the perspectives of companies (that have been
involved in projects using BIM) on those potential legal issues and their experiences
in dealing with those issues. The information provided in this paper can be used by
any entity that is considering using BIM on a future project as these potential legal
issues can impact such entity whether it is the contractor, subcontractor, owner, or
designer (architect=engineer). It is important that the potential users of BIM become
aware of the potential legal issues and how these issues are evolving within the
companies that have been using BIM to make better informed decisions.
The potential legal issues within the scope of this paper are listed below and
discussed in the subsequent section:
1. At the conclusion of the project, who will own the final model?
2. To what extent can the participants of the project rely on the information in the
model to perform their work?
3. Since BIM works best as a collaborative process, will there be a shifting of risk
between designer and contractor over means and methods of construction and
design?
4. Will the Standard of Care doctrine, which requires the architect to operate at a
certain level of care and competency, go up in a project using BIM?
5. Should the participants get compensated for the added cost of BIM as well as the
value added as a result of utilizing BIM?
It is important to note that while this list may not be comprehensive and new legal
issues may come up due to the quickly-evolving nature of the topic and BIM technology, the five potential legal issues that are within the scope of this study were

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D. B. Arensman and M. E. Ozbek

identified to be the most relevant and important through a comprehensive literature


review.

Overview of the Potential Legal Issues Related to BIM


This section provides an overview of the BIM-related potential legal issues that were
identified through a literature review and were subsequently studied in this research.

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Model Ownership
The first issue that was investigated deals with who, at the completion of the project, will own the model. The owner will certainly want the model, as they will need
it to have a depiction of the final product and use it to manage their facility. The
architect, by law and custom, has intellectual rights to their model, as it was their
creation; and often is reluctant to release the model. According to Larson and
Golden, lawyers with M.A. Mortenson, the legal principle is clear: Absent contract language to the contrary, the party that creates the model owns it (Larson
& Golden, 2008, p. 22). However, since a typical BIM project will have information
contributed by multiple parties on the overall architectural concept model, each of
those parties will want to ensure they own the model they contributed to (Larson &
Golden, 2008). One concern each model builder can potentially have regarding
ownership is the repurposing of the model and its data. Repurposing involves using
the data in the model for other projects or in ways not licensed by the owner of the
intellectual property. Although Consensus DOCS 301 BIM Addendum, the standard form document that specifically deals with BIM, addresses the issue contractually, granting each party a limited, non-exclusive use to the models for the
purposes of that project only (Lowe & Muncey, 2008), there is not a widelyaccepted industry practice on this issue.
Right to Rely
The second issue that was investigated involves the right to rely on the model. Those
firms receiving the model will want to rely on the model, and the information in it, to
do their work. There is the expectation that the model will be free of defects or omissions. On the other hand, the firm transmitting the model wants to limit its liability;
once the model has left its control (i.e., shared with other parties for them to provide
input), the firm does not wish to be responsible for any work created from it. This
has led to the development of disclaimers that significantly limit how the firms
receiving the model can rely on the model. The end result is that many of the potential efficiencies of using BIM are wasted as the firm that receives the model has to
recreate its own model, probably from 2D drawings, since it cannot rely on the
model that was given to them (Larson & Golden, 2008).
Shifting of Risk
The third issue that was investigated deals with the shifting of risk between parties
involved in the construction process. With the increased collaboration among the
team members, the traditional legal apportioning of risk might be shifting. With
the various parties working so closely together in a collaborative environment and

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providing input to the same model, there is concern that architects might assume
some means and methods liability while contractors are concerned that they may
assume design liability (Larson & Golden, 2008). The current legal system is based
on the idea of definite responsibility. Each party knows what it is responsible for
and if there is an issue, liability and responsibility is apportioned along those lines.
Those definite roles and responsibilities may not be inherent in a project utilizing
BIM (Brodsky, 2006).

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Standard of Care
The fourth issue that was investigated deals with the standard of care. The standard of care doctrine suggests that the architect must use that same level of care
employed by reasonably prudent professionals practicing in the same field in the
same area (Thomsen, 2008, p. 13). With BIM becoming the new standard in
the industry and its ability to detect conflicts and prevent mistakes, it is likely that
the standard of care will also evolve, potentially resulting in clients having higher
expectations regarding the skill and care that is exercised by the architects
(Pressman, 2007).
BIM Compensation
The final issue that was investigated was compensation for BIM, specifically whether
the participants should get compensated for the added cost of BIM as well as the
value added as a result of utilizing BIM. The act of creating the model requires more
work to be done which subsequently adds value to the downstream consumers of
that model. While BIM projects tend to be less expensive for owners due to the
decrease in change orders, conventional compensation for designers lacks financial
incentives for them to implement BIM. The design industry is still trying to figure
out how to explicitly define the added value of BIM in current contracts to get
compensated for that (Post, 2006).

Methodology
To be able to achieve the purpose of this study, the qualitative research methodology
was used. Creswell (2009) discusses different data collection procedures that are
commonly used in qualitative research. Of those methods, this research utilized interviews with knowledgeable individuals (in companies using BIM) as the main data
collection method as described below.
The population of interest for the interviews was architects, contractors, and
owners, i.e., the primary entities affected by the potential legal issues discussed in
the previous section. The focus was on only those companies that have been involved
in projects using BIM to identify their perspectives on the potential legal issues discussed above and their experiences in dealing with those issues. Ten individuals were
interviewed on this topic with three representing architects, three representing owners, and four representing contractors, one of which is a dedicated subcontractor.
These interviewees were recruited from small firms with few employees to large firms
that employ thousands to allow for diverse opinions to be represented. These companies were identified through literature review and press releases as having significant BIM experience.

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A semi-structured interview method was chosen; because while it does not


restrict the interviewees strictly to an interview protocol, it also helps minimizing
the variation between the interviews (Bell, 2005). Using this method allowed for
additional questioning, either for clarification or to expand on an answer if necessary. In short, this interview method enabled the rich gathering of information
through detailed explanations by the interviewees.

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Findings
This section presents the findings of this study as gathered through the interviews
with respect to each potential legal issue that was investigated under its respective
heading.

Model Ownership
The general consensus (with a few caveats as discussed below) between the architects
and contractors was that all models belonged to the owner, since model is a normal
artifact of the architects and contractors work, created for the owner.
Architects indicated that the very nature of their work required the production
of the model for a given project and thus were willing to give that model to the
owner; however they were concerned about protecting what they consider to be their
intellectual property component of the model. To them, an architects model contains crucial intellectual property that would later be easily accessible to the owners
and contractors who used that model. Architects were concerned that their original
model might be repurposed or reused; so the architects wanted to take measures to
prevent the reuse of their ideas in the model for other projects.
Contractors made a clear distinction between the ownership of the actual model
and the information contained within the model. The contractors generally believed
that the information within the model belonged to the parties that created the information. However, they also stated that regardless of which entities contributed to the
development of the actual models, those models belong to the owners for limited use.
This limited use was similar to the one proposed by the architects in that the information was for use on the specific project for which it was created only but could not
repurposed for subsequent projects.
Two of the interviewed owners believed that the ownership of the model was
immaterial and the ownership of the model could stay with the architect, as long
as the owner retained the right to use the model in perpetuity. The owners access
to the model and all the files would be in the form of a perpetual license specific
to the project, but this did not mean the owner actually owned the model. In the
instance of a perpetual license, the model could then be used for future operation,
maintenance, and marketing purposes but not for the purpose of reproduction of
the structure in other projects.
The third owner, however, was unequivocal in stating that they owned the models developed as a result of BIM inclusive of the intellectual property the model contained. This owner indicated that in their projects, the architect and contractors were
required to waive the intellectual property and the model could then be reused in
other projects without further compensation.

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Right to Rely
Architects were divided on this issue. One architect stated that they would decline
to give the right to rely. On the other hand, another architect felt that models
should provide a level of reliance similar to what is to be expected from a 2-D
drawing. For their purposes, each participant should rely on the model exactly
as if it were a 2-D drawing. Another architect noted that the right to rely is a contractual issue, in a larger sense. The owner has the power to decide how much the
participants in the project can rely on the model. If the owner wishes to mandate a
high level of reliance, with all of its benefits, the owner must be willing to pay to
each contributing party for the additional time taken to make the model more
robust.
Contractors were unanimous in saying that they would like a model that they
could comfortably rely upon to do their work; and one contractor stated that the
right to rely is the single biggest barrier to adoption of BIM within the industry.
However, the contractors differed in the way they deal with this issue.
One contractor indicated that they rely on the model wholly to do their work.
This sub-contractor, whose specialty was wall systems, explained that an enormous
amount of energy was put into the creation of the models and to waste that effort
would be ill-advised.
The remaining contractors were willing to take the models supplied and scrub
them for errors. One contractor stated that it would take far less time to verify
and modify a model than to create one from scratch because of the fear of relying
on that model. One contractor would take the model, scrub it for errors and then use
that model. Another contractor stated that if they were to find one error, they would
scrap the entire model and build their own from scratch.
The owners were more unified when it came to the issue of the right to rely. They
all felt model reliance issue was between the architect and the contractor and
expressed that it is not their place to interject themselves into that part of the
architect-contractor relationship. One owner rejected the idea that the right to rely
would be a real problem, declaring The legal risk for right to rely is in the drawings
and specifications, not the model [created through BIM].

Shifting of Risk
Architects were in agreement that the shifting of risk is impossible, because architects
do not create a model to the level of detail for that to happen. Architects are trained
to be holistic thinkers, designers, and problem solvers. They do not typically have the
in-depth construction knowledge that would allow them to cross the line into means
and methods.
Contractors also had similar views on the shifting of risk. Mainly, a poorly managed BIM process makes the possibility of shifting of risk more likely but it should
not happen if the process is managed properly. As one contractor stated, If you
apply the rigor that we are all used to applying, then there is no problem. All of
the contractors stressed the need for a good change management procedure when
using BIM in a project. Since so many changes happen so much earlier, this ability
is critical to capturing the changes and communicating why those changes were
made. This process allows the changes to be traced back to the responsible party.
As one contractor stated, If you model without a change management process, then

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you have lots of problems with shifting of risk. If utilized correctly, BIM software
has tools for tracking changes and thus minimizing the shifting of risk.
The owners acknowledged that there is a possibility of a shift in risk, but that the
probability is minor. In addition, owners clearly stated that the shift of risk has nothing to do with them and such a potential conflict is between the architect and the
contractor. One owner stated that they do not involve themselves in this area at
all. Another owner who was responsible for some seventy projects (large and small,
all of which were using BIM) articulated that they had never seen an instance where
risk was shifted between parties. The owner concluded that if all the parties were diligent in their work process then problems with respect to risk shifting would not arise.
Standard of Care
Architects stated that the standard of care will go up as BIM becomes more prevalent; and they are ready for this paradigm. BIM supplies many tools that help reduce
errors and as architects use these tools, many of these errors will be eliminated. As
such, expectations for a lower error rate on a project utilizing BIM will increase and
the industry will have to meet that new standard. This will be an evolutionary process. As more projects are done using BIM and fewer mistakes are made, the level of
what is acceptable will naturally rise. However, the use of BIM is not ubiquitous
within the industry so the rise in the standard of care will occur slowly.
Contractors also felt that the standard will and should increase with all the tools
supplied with BIM. Contractors unanimously agreed that this will be a drawn-out,
evolutionary process. While contractors accept this increased standard of care,
one contractor cautioned, Standard of care is defined by the courts and not the
contract documents. So, the parties need to be aware of how the courts are treating
this issue.
All owners were just like all the others interviewed in stating that the standard of
care will and should increase. This is due to the power of the technology to catch and
correct errors before the participants go to the field. Clash detection, the ability to
zoom in on problem areas in 3-D, and enhanced cooperation between all participants are all part of the normal BIM process. With these tools leading to a
reduction in errors, the owners feel those will no longer be normal errors and they
will no longer impede the construction process. Since those errors should disappear
on a well run BIM project, the standard of care should naturally increase.
BIM Compensation
Architects were clear that currently they would like to be sufficiently compensated
for the increased effort involved with the creation of a model and the value recognized by the owner as a result of that. Nevertheless, they recognize that becoming
more sophisticated in using BIM will help make their work more efficient (due to
streamlined design process and less requests for information) and subsequently
reduce their costs. This contradicts much of the literature that was reviewed for this
study, which suggested that using BIM would always result in cost increases. As one
architect suggested Once you are doing BIM, there is not an additional cost to do a
project in BIM. It is also important to note that one architect brought up a potential dilemma about BIM compensation for architects and stated that architects typically bill in hourly rates. If BIM eventually makes the design process more efficient,

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then billable hours will go down. With BIM they have an increase in costs (the BIM
software, training costs, licenses, and increased hardware costs) and a decrease in the
number of hours they can bill.
The contractors did not expect additional payment for contributing to models
and most of the contractors expected the BIM Premium to quickly disappear as
model use spreads in the construction industry. One contractor adamantly predicted
the demise of the premium by stating, If I were an owner, I would not pay a penny
more for BIM. The contractors justify this belief by looking to the transition from
paper to CAD. In the past, architects charged a premium for CAD when the technology was entering the marketplace and BIM may be experiencing similar treatment. All of the surveyed contractors commented that they would not be willing
to make additional payment for using models nor will they charge for contributing
to those models. The contractors consensus was that the use of BIM is a natural
extension of technology and their services. Notwithstanding these comments, one
contractor explained that the ability to monetize the value of BIM is extremely complicated. Similar to every place of business, proper compensation is critical and will
hasten adoption of this valuable tool. The contractor stated, For BIM to reach its
full potential with all of the parties involved, particularly the owner, one needs to
figure out a way to value BIM and figure out how to compensate parties for that.
The owners were unanimous in saying that they would not be willing to pay
extra for BIM. They were all aware of how the BIM works and leads to increased
productivity and more efficient design and construction processes. Owners were
not prepared to make an additional payment for a process that makes the architect
and the contractor more efficient. They expect those parties to use the increased efficiencies of BIM to make the BIM pay for itself.

Conclusions and Future Research


With the increase in the utilization of BIM in the construction industry, it has
become clear that there is some legal uncertainty in dealing with this technology.
While the technology is rapidly growing in sophistication, these legal uncertainties
may be acting as obstacles on BIMs wider adoption. It is important that the potential users of BIM become aware of the potential legal issues and how these issues are
evolving within the companies that have been using BIM to make better informed
decisions. Within this context, this papers purpose was to: (i) provide an overview
of the potential legal issues associated with BIM and (ii) present the perspectives
of companies (that have been involved in projects using BIM) on those potential
legal issues and their experiences in dealing with those issues as gathered through
semi-structured interviews.
Ten interviewees representing different entities in the construction industry
(three representing architects, three representing owners, and four representing contractors, one of which is a dedicated subcontractor) that are primarily affected by the
BIM-related potential legal issues were carefully selected. The focus was on only
those companies that have been involved in projects using BIM to identify their perspectives on the potential legal issues and their experiences in dealing with those
issues. These interviewees were recruited from small firms with few employees to
large firms that employ thousands to allow for diverse opinions to be represented.
On the issue of model ownership, the groups of contractors and architects had
similar views. Both groups stated that they would surrender the model to the owner

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D. B. Arensman and M. E. Ozbek

for its use, with a perpetual license for operations, maintenance, and marketing
purposes, but would retain all rights to the intellectual property in the model so that
the owner would not have the right to repurpose and reuse the model for other projects. Two of the owners indicated that they have exactly this arrangement in their
projects, but the third stated that they demand the ownership and reuse rights in
their projects.
The responses on the right to rely were more diverse both within and across
groups. The architects differed in their opinions in giving other parties right to rely
on the model, with one architect refusing to do so, the other one doing so, and one
suggesting that owner should pay a considerable amount of money to all parties for
them to be comfortable in giving right to rely without any disclaimers. The contractors all agreed that they would like to be able to rely on the model provided to them
but differed in what they do in practice with one wholly relying on the model provided to them and others first scrubbing the model for errors and then relying. This
approach of verify and modify to deal with the right to rely issue is very practical
and efficient when compared to recreating the model from scratch as the literature
suggests. All of the owners stated that this issue was between the architect and the
contractor adding that they were hiring two experienced construction professionals
and felt no need to interfere with this (as one architect suggested).
On the issue of risk shifting, the architects were in agreement that a shift in risk
was impossible because typically they do not have the knowledge of means and
methods to make this a possibility. The contractors were in agreement that providing
input into the models can introduce the design risk to be assumed by them but with a
rigorous change management process this was very unlikely. The owners, like the
right to rely issue, did not involve themselves in this issue; one owner adding that
they have never seen a case where this risk shifting occurred.
There was unanimity of opinion on the standard of care question within and
across the groups. All parties felt that the standard of care would rise within the
industry because of BIM. All the tools that the technology brings to the table in eliminating errors and data validation will cause them to not be normal and accepted
errors anymore.
Finally, on the issue of BIM compensation, architects were in agreement in their
current desire to be compensated for the increased effort involved with the creation
of a model and the value recognized by the owner as a result of that. They also recognized that this extra payment will not be needed as they become more sophisticated
in using BIM. The contractors stated that they do not charge any extra for contributing to models as required by BIM and added that architects should not either. The
owners stated that they do not and would not pay extra for BIM because it is a process that makes the contractor or the architect more efficient anyway (less requests
for information, less change orders, etc.); this should compensate for additional
efforts.
In each of the five issues that were investigated, there was mostly consensus
within different groups (i.e., architects, contractors, and owners) notwithstanding
the differences in the size of the companies representing these groups, with a few
exceptions. It is important to note that for a few issues, there was mostly agreement
all across the different groups as to how those issues were perceived. This is
especially the case for the standard of care issue which is acknowledged by all parties
and which may result in a change in the courts view on the long-established standard of care doctrine. However, the right to rely and BIM compensation issues

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resulted in the most amount of differing opinions; consequently it can be asserted


that these are the two main issues that the construction industry needs to work
out in the years to come.
This study was an initial attempt at addressing what was felt to be an important
and evolving topic (i.e., BIM-related potential legal issues) in the construction industry. While being limited in its coverage of the construction industry, this study
showed that the issues discussed herein are in fact legitimate and important potential
legal issues as evidenced by the different perspectives held by different parties with
respect to those issues. The logical next step would be to investigate these issues
(as well as others) by having more participants and holding focus group sessions
with the attendance of multiple parties to promote discussion among different parties to be able to generate a more detailed picture of the issues and to ensure a better
representation of the whole construction industry. It is believed that the wider adoption of BIM will allow for further studies on the topic with the attendance of more
participants.
Another future research that can be performed with wider adoption of BIM deals
with the implications of the standard set of contract documents (e.g., Consensus
DOCS, AIA) and Integrated Project Delivery (IPD) contracts on the potential
BIM-related legal issues and how certain contract language can address such issues.
This study focused on the legal uncertainties which may be acting as obstacles on
BIMs wider adoption. Nevertheless, there is a myriad of other issues such as the
technology requirements and cost implications that can be slowing the adoption
of BIM; therefore a broader research investigating all possible issues would be very
beneficial for the industry.
Finally, while performing this research, a possible future research topic was
identified. Currently, architects typically charge based on hourly rates. Using BIM
as a design and documentation tool, the hours required to create and update a model
can significantly reduce, creating a decrease in the architects billable hours when
they have an increase in costs (the BIM software, training costs, licenses, and
increased hardware costs). Future research should investigate what impact this
dilemma will have on the architects pricing model.

Acknowledgment
The authors would like to thank Dr. Charles (Chuck) Smith and Dr. Robert (Bob)
Rademacher and all of the interviewees for their contributions to this work. The
authors would also like to thank the reviewers for their constructive and useful comments.

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