The Economics of Legal Research
One doesn’t normally expect a Blog quite as focused as the Huffington Post to spend much time on the legal publishing industry but Peter Schwartz’s post on the Reinvention of Legal Research is worth a bit of attention.
A couple of extracts:
When online legal research platforms were proprietary, online publishers imposed per-minute and per-use pricing structures. This pricing model facilitated client cost-recovery and allowed publishers to use law firms as information wholesalers. Because information is now a commodity, law firm clients will no longer pay for online legal research. New flat-rate pricing models for online research products reflect this reality.
The large legal publishers are in trouble. If law firms can no longer pass through online research costs to clients, multi-billion dollar legal publishers such as West and Lexis can no longer support pricing models premised on law firm cost recovery. Because West and Lexis cost structures depend on this pricing model, they are beginning to experience painful margin squeezes, compounded by the entry into the legal research marketplace of both nimble, low-cost competitors and new rivals with deep pockets such as Bloomberg.
The economic models that have so long prevailed are not inevitable; rumblings like Stanford’s objections to a 10% hike in the price of a tax journal or the AALL saying no to Westlaw sponsorship dollars because Eagan won’t play ball on legal information pricing surveys, show that consumers are wondering exactly what the duopoly offers in the way of better searching that justifies the premium prices.
Great quote from an old Larry Bodine column:
Do you have links to the Standford objection and the AALL rejection of Westlaw funding?
Here is the story from Library Journal under the headline, Law Libraries Spurn Sizable Publisher Sponsorship –
AALL protests Thomson-West’s withdrawal from its Price Index, and further comments here Updated: Did AALL Refuse Thomson-West Sponsorship Cash for the Annual Meeting? “Yes” and the response from Eagan
The Stanford story appears to be here, but my firm’s settings will not permit access to confirm
Paul Lomio is the Director of the Robert Crown Law Library at Stanford, and his brief post about the 10 percent increase in the cost of CCH’s Taxes: The Tax Magazine is on the LegalResearchPlus blog.