In a recent post on Slaw, Robert McKay has offered an interesting critique of the legal and professional publishing profession as it exists today (Fun but Dangerous Work: Surviving Professional Publishing), with insights as to new hires and advice to the legal publishing companies on the risks of de-hiring talent for short-term gain on the bottom-line.
Robert's perspective is very different from my own in that he chose professional publishing for his career, and did not simply fall into it as was the case when I first joined a legal publishing company. Nonetheless, his assessment of the current state of the profession is close to my own.
An accidental publisher
In my case, I intended to practice law, but the firm I was with suddenly split up leaving me with no choice but to look for an alternative. A friend suggested that I take a temporary position with a legal publisher until I could get back on my feet. In short, I was the very sort of person that Robert would never have hired, someone with no knowledge of the industry and with no intention of pursuing publishing as a career – a dilettante at best. Some period of time passed before I embraced the idea of being a publisher with the passion that Robert felt from the beginning. I did however like books and the process of creating them and assumed that was enough.
My perspective on legal publishing was validated an early meeting with Maurice Maxwell, of the original Sweet & Maxwell family, who inherited his career as a legal publisher. To him, publishing was simply an occupation "suitable for a gentleman". Your tailoring and table manners determined whether you were hired by one of the established legal publishing houses. Interviews were pleasant conversations over lunch, usually at a private club. If you could construct a sentence, that was a bonus.
Needless to say, that era is long gone. For a fresh take on the subject, by someone comparatively new to the role, I would suggest reading the chapter "Working for Legal Publishing Companies" by Danann Hawes in the book Legal Information Specialists: A Guide to Launching and Building Your Career, edited by Annette Demers and published by LexisNexis in association with the Canadian Association of Law Libraries. To Danann and his peers, it is an exciting time to be in legal publishing:
The legal publishing industry in Canada, while small compared to many jurisdictions, is fluid, adapting to changing market conditions and highly competitive. The days of being a “print publisher” are long gone, replaced with the need to not only have a complete online offering, but a robust offering of related and integrated functional tools to assist lawyers in their practices. Sustainability and revenue growth require “big picture” thinking, a focus on partnerships and acquisitions with external stakeholders, and a strong view to strategy and long-term thinking. There are many different types of jobs in this industry; legal publishers are strengthened by having employees with a diverse range of talents, educational and professional backgrounds. Having a broad understanding of legal research, knowledge of the legal marketplace, what lawyers need and how they think, are invaluable skill sets in this industry.
Danann's career had similar beginnings to my own, starting out as a traditional law book editor with private aspirations to do something else (in Danann’s case to become a screenwriter), but that but that soon progressed to content development in the wider sense:
Today, the print product is usually and merely the first content output. While content will usually have its first life in print, the words and pages will inevitably find a second home online, and now, increasingly, repurposed for other product lines, outside the traditional parameters of legal research. “Content” now is perceived as a general concept, developed and then streamed into various end states.
The quest for a new business model
As Robert says, legal publishing is still fun but it is definitely dangerous work, in the sense that it is a career that is fraught with uncertainty. It is clear that the legal publishers have lost control of their business model. This failure has put many a career at risk. “Survivors” are loosely defined as the persons who managed not to take the heat for this failure.
Needless to say, legal publishers are generally unwilling to admit this failure. Reference to it is usually framed in a positive light by diverting attention away from legal publishing:
While legal research is still the major revenue generator for each company, the strongest growth levers are with products outside the traditional print and online legal research.
Translated loosely, this means that there is no expectation of any significant growth in legal information publishing. Growth for legal publishers must come from selling other products to the same market.
In a recent post, From Westlaw to a Software Company – Thomson Reuters Bold Leap, Simon Chester describes the most recent efforts of Thomson Reuters to "re-conceptualize the company" with "projects that enable project management type workflow". In short, shareholder value can no longer be enhanced by selling and licensing legal information. "Cloud based solutions" have become the new mantra.
The old order is failing
In the major legal publishing houses, the business of legal publishing is based on a combination of publishing recycled government and court documents and publishing secondary content. The business model for both was a simple cost-plus formula, designed to minimize costs and maximize mark up. Government and court documents would have value added content generated by the publishers staff or by freelancers, but the costs would be minimal and the mark ups significant.
Authors of legal publications were persuaded to work for "reputation", while consumers of legal information were "educated" to accept high prices on the basis of the small market size. Any short-fall in revenue was off-set by price increases, usually disguised as product enhancements such as increased frequency. The key difference between primary documents and secondary works was essentially the scale of the mark-up.
The opportunities that existed when I first joined Carswell were enormous. Law reporting was inadequate to meet the demand for access to caselaw. There was no comprehensive Canadian case citator, statute citator, words and phrases, or Index to Canadian Legal Literature. Carswell published two or three texts a year. Loose-leaf services of specific topics were left to CCH to publish. Online services were a pipe-dream. The possibilities appeared to be endless.
The same was true when I joined Lexis Nexis. Butterworths had previously curtailed its publishing program of secondary content and the opportunity that existed to match and surpass the competition was inspiring. There was no Halsburys Laws of Canada and no Juris Classeur encyclopedia for Canada and Quebec. Quicklaw when acquired was in need of major enhancements and upgrades to meet expected future competition from Carswell and Canada Law Book. It was great fun.
The easy money is gone
At the heart of the problem with the business model is the massive decline in the value of recycling government and court documents. Originally, the transition to online was seen as an extension of the same business model, with the same opportunities to grow revenue as more and more content became available online. That premise proved to be true only as long as there was one online service provider. The emergence of free services and the competition for customers that followed the development of alternative online services that are virtually clones of one another has resulted in lower prices and declining revenue in the most profitable area of legal publishing.
Secondary content is also a troubled area. Here the problems are the result of the abandonment of support for the development of secondary content by the library and research communities, the exhaustion of the loose-leaf format, and uncertainty as to the choice and pricing of digital formats.
- With secondary content, the publisher could be certain of a minimal number of purchasers for every publication of quality as major law libraries acquired copies of virtually every print legal title published by a major legal publisher. This practice ensured that the legal publisher would cover its basic costs, while the additional sales to the legal profession would provide the profit margin. In recent years, budget constraints and the have reduced the number of assured sales for every title, thereby reducing the certainty that the publisher will be able to recover its investment when it publishes quality scholarly writing. Even with budget restraints, this is an unfortunate outcome, that could be remedied if different choices were made regarding collections.
- In the late seventies and early eighties, the major legal publishers copied CCH and introduced loose-leaf formats across the board. To customers, looseleaf were seen as a means of maintaining currency without having the pay the full cost of a new edition. That premise was undermined when the cost of annual supplementation came to exceed the cost of buying a new copy of the publication, and when the hidden costs of filing releases were fully understood. The consequences of this shift in cost from main work to supplementation may be seen today in the stacks of the great library collections which resemble graveyards for discontinued loose-leaf publications.
- Digital formats are now seen as the new format of convenience, with the potential to deliver the promise of performance and cost effectiveness that looseleaf services were intended to deliver. The issue is which digital format to use for which content and how to use it profitably.
Every era presents new opportunities and challenges
In every generation, legal publishers have faced new challenges and new opportunities, with varying degrees of success. In the early seventies, legal publishing in Canada was dominated by Canada Law Book and CCH Canadian, while Carswell and Richard de Boo were perceived to be going nowhere. Canada Law Book published most of the major legal treatises and all of the major law reports, while CCH had the leading looseleaf services in key subjects such as publications in corporations law, labour, family, estates and tax.
By the eighties, Carswell had displaced them all as it became the leading publisher of legal information and new players like Maritime Law Book took a share of the market. By the nineties, Carswell had acquired Yvon Blais and become the national legal publisher. Canada Law Book has since been folded into Carswell while CCH has gone quiet, if not dormant, since its failed in its attempt to acquire Quicklaw. Carswell is now being challenged by Lexis Nexis, and on and on it goes, with one publisher edging up while another loses market share.
In the coming decade, it is up to Danann and his peers to move the industry forward, to make the choices and take the risks that will determine their ultimate success or failure and the success or failure of the legal publishers who employ them, be it in the cloud or elsewhere. As Robert says in his post, it is a fun but dangerous industry. Enjoy.