Internet Newsletter for Lawyers
Most of the current profits from legal publishing remain tied to the provision of loose leaf services which were first introduced about 50 years ago. It is worth pausing for a moment to admire the resilience of this business model.
It has a simple beauty. The customer places an order and receives a book and a ring binder. Further regular updates follow, all paid for by the customer. The publisher has no need to reprint the costly volume and the update work is carried out by the customer, whose responsibility it is to ensure those updates are catalogued correctly and filed in the right book, in the right chapter and in the right order.
Many of the most popular paper based services have become almost automatic reorder items for large law firms, and this has led to successful law publishing being tied to inertia in the client base. Up until now, the model has worked very well, but nothing lasts for ever. Customers change. Worst of all, they get younger and demand to do things differently and more efficiently.
The pressure for change is not unforeseen. Law publishers have recognised and discussed it for the last thirty years and they know that the day will come when digital media will replace these paper services. Nonetheless, it remains a significant problem to replace lost paper revenues with new digital revenue. A digital service, in the customer's eyes, should not cost any more than the old books and, in fact, they intuitively realise that it should be less costly.
After all, the internet means that these products could be updated overnight without the customer knowing and without the fuss of traditional paper based services. Lots of information on the net is free anyway …
When you have spent 50 years slowly increasing book prices, then it absolutely goes against the grain to devalue your precious back catalogue by sending out inexpensive CDs or making content available online at discounted prices. The subscription rates have to be maintained and new, digital services must be priced at the same level.
Unfortunately, customers see publishers charging twice for the same product and believe digital services are cheaper to produce. By avoiding the issue publishers have lost the argument and the opportunity.
Bluntly, the traditional law publishers dare not produce quality digital products because this will hasten the inevitable decline in the sales of book based legal reference material, especially those very profitable loose leaf services. Take precedent material for example. Why is it that the vast majority of precedent material provided by UK law publishers is still in paper format, when there are any number of document assembly products - such as HotDocs - being used effectively in other parts of the world?
It will not be possible to replicate the existing paper margins (up to 90%) in the new world of digital publishing. Especially as these book publishers have to learn a completely new trade whilst fighting off lots of new, quick and lean competition, unfettered by history and institutional shareholders expecting a seamless transfer from paper to digital business without missing a beat in performance.
Is it possible to transfer the business model of the existing publishers to the new digital age? Surely not without a great deal of pain. Staff reduction and copious re-training of the remaining staff are just two of the issues to be faced if old book publishers attempt to metamorphose into bright, young, digital things. It seems unfair but customers cannot be expected to forgo technical and technological advances out of sentiment.
Lawyers have had to change too. Web publishing has given them greater opportunities. Where the vast majority of legal content, whether commentary or precedent material, is provided by lawyers on a royalty system, publishers have rarely paid much for it. The reward is in the recognition.
Recognition of the individual is one thing, but recognition of an individual law firm is quite another. Until recently, it was a laughable idea that all but the very largest of international law firms might consider publishing but in the last 10 years the rise of the law firm as publisher has begun.
Virtually all law firms have become publishers by necessity as the essential, and generally painful, web site has grabbed many otherwise chargeable hours. Solicitors are forcibly turned into reluctant digital publishers – but why? Again, publishers have missed an opportunity.
Cards on the table. I'm prepared to back my opinions and I have recently made an investment in Henry Scrope's www.Emplaw.co.uk business and believe it is a great example of a small and nimble competitor creating a better product than the massive, incumbent players. Henry's employment law site is easy to use and has a vast amount of free and useful material, alongside excellent and well written commentary and digital research tools, all of which is available at reasonable subscription terms, coming in at less than half of the price of the incumbent law publishers.
Search on Google.co.uk: the site is first for UK employment law, entirely on merit and without corporate funding.
Digital publishing is a different business and has to provide services to customers at highly competitive rates. Technology can increase profits and, in turn, should increase profits for customers by passing on lower costs and creating opportunities for new business. An example of this is the arrangement that Emplaw has made with Norton Rose to introduce an extranet for their clients delivering both Emplaw research material and HotDocs precedents. This was launched in 2000 and has been very successful.
In Summary, it seems to me that there are many opportunities for new digital legal publishers, and a willing customer base for useful and appropriately priced material.
Russell Shepherd is Chairman of Capsoft UK (www.capsoft.co.uk), based in
Edinburgh. He developed Everyform.net, a site providing free forms on the
Internet, using Capsoft's document assembly product HotDocs. Everyform was
sold in 2001 to Reed Elsevier for an undisclosed seven figure sum. He has now
made a substantial investment in Emplaw (www.emplaw.co.uk), the innovative
employment law subscription website developed by solicitor Henry Scrope, and
is now the Managing Director of the business, with Henry Scrope continuing as
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