Vendors know that information technology professionals don't manage contracts very well. This clause provides for the automatic extension of the agreement if the vendor isn't notified by a certain date a few years down the road, when no one has seen the contract for a while or there are new people in charge of the project for which the deal was done.
Vendors describe an automatic renewal as a customer convenience.
They argue that it prevents service lapses and eliminates an administrative burden for you. The unmentioned risk is that you might be paying for a service you no longer need. But the reality is that a lifetime of administrative effort required to renew contracts is more than paid for if just one unwanted automatic renewal is prevented. What's more, conditions and requirements change rapidly today. Automatic renewals pre-empt making choices.