The Law Publishing Business Is Finished
Delusion only lasts for so long but at a certain point all the indicators cannot be ignored; law publishing, as a business in its own right has run its course; it’s pretty much over, if not necessarily, according to the caselaw, in the toilet.
Previously I suggested a likely scenario envisaged in the not too-distant future. If accurate, I predicted that by that time professional publishing will have become no longer a business in its own right. Rather it may evolve into an increasingly not-for-profit skillset within larger media entities that simply wish to maintain overall relationships with and profits from certain market sectors, such as lawyers, accountants and tax advisers. That many, if not all the relevant component competences have already been outsourced to the Philippines and thereabouts, with predictable results, is a strong indicator of what will be the next steps. In my view the time has arrived, more or less. I would reiterate the point that there is little to indicate that there is no longer a need and demand for professional information that is published in current and future media but rather that, with notable exceptions, these activities have reached a point at which they are no longer businesses but rather are departmental functions. There is much evidence in support of this. Therefore, as with a law or accountancy practice that for one reason or another produces certain professionally-oriented publications, even using dedicated and expert staff to do so, their business cannot be said to be that of publishing.
The primary evidence is from the major suppliers themselves, all of which continue to stress that they seek to engage with major clients at every possible opportunity and provide legacy content-rich software and business support of one kind or another, within which there may or may not be professional publishing components. Their statements to this effect are frequent and consistent. Further, within those businesses lies the fact that, other than for exceptionally important and high-value cash-cow purposes, growth-oriented revenues and profits do not and are not anticipated to come from what were their professional publishing business units. Recent acquisitions confirm the trend, with Lexis Nexis (RELX) taking over Intelligize, a business that, split infinitive notwithstanding, “provides a leading analytics solution enabling legal, academic and business professionals to efficiently mine data and insights from SEC filings, M&A contracts, transactional agreements and corporate governance documents”. As an account of Simba Information’s Global Legal Publishing 2016-2020 suggests, “Law Books No Longer King; Online Databases Set Pace”. The research indicates that tools and solutions are among the fastest growing legal publishing activity tracked by Simba but with a market estimate of nearly $3bn., the category has a much larger impact on the total performance in legal publishing. Hugh Logue of Outsell, produced a 2016 report indicating that the legal and regulatory solutions market declined by 5% to $22bn in 2015. The same company anticipates growth in financial information and tax and accounting solutions.
The major information providers have to a most significant extent, moved on, selling or closing information assets, some that are non-core and reconstructing others to shift the emphasis and attention away from the essential elements of innovating in and running publishing businesses. There is little interest in creating new content but rather in reusing, sometimes, existing primary source material to support electronic tools. In the case of Thomson Reuters, though, one might wonder as to in what areas they are competent or to be trusted at all. Organisationally, layoffs continue as possibly cynical tactics are applied at senior management level to trigger cost-saving bonuses for themselves by suitably timed redundancies and skulduggery to achieve, sustain or increase profitability. Hot-desking is increasingly encouraged and available office space in some cases is being reduced, having the effect of disengagement of people from their industry. They concentrate almost exclusively on the needs of the largest and richest international clients, mid-sized ones being too diffused and inappropriately staffed to be managed as clients for solution-selling. Below that, small firms are largely an irrelevancy to the major publishers. Yet often to the frustration of even the big firm intermediaries such as law librarians and knowledge management specialists, they are obliged to deal with possibly questionable business practices and snake oil salespeople masquerading as trainers and technical advisers, when the need and desire is for expertise, experience and intimacy that are not made available, because they do not exist. In these respects, it may not be the intermediaries’ unwillingness to evolve that is at issue but rather questions of ethics and ways of doing business.
At one level, so little appears to have changed. Living and working, as I do, in the City of London, I frequently find myself around Fleet Street and the Inns of Court. Be there at the right times of day and it is charming to observe the serf class of part of the English legal profession shuffling to and from court pushing trollies loaded with evidential and other documents, as well as mountains of legal tomes. It makes one wonder where are the document management systems, process and intelligent software and online information collections and tools. To the outside observer, certain practitioners seem to be doing things pretty much as they were half a century ago. Things are changing, though and their consequences can be seen in the sometimes troubled relationships between information providers and so-called “gatekeepers” of the customers, each, arguably, more conservative than the other.
Perhaps it is the case that corporate aspiration requires people to look to a different environment than the more solid, even mundane world of professional publishing business and this is a greater driver than understanding, measurement and observation of customer requirement. What dynamic aspiring or senior executive with no established personal relationship to the law would want to be immersed in its intricacies and foibles? However, in these ways one sees the customers continuing to debate formats and products or services about which the suppliers care no more. So often customers even speak of the suppliers by different brand names than those that are used by the suppliers themselves. Their respective agendas are sometimes not aligned.
One might wonder if the proposition relates only to the top three or four suppliers and if, below that, lies a law publishing business environment that is not so dysfunctional and operates more satisfactorily for all parties. My suspicion is that it does exist but perhaps not for long. There, everything is smaller, especially revenue, profit and the depth and breadth of the cash cow element. There simply is not the beneficial residue that sustains for a long time, so that sooner or later the processes or disposal and acquisition, restructure and reassessment diminish the number of places where law publishing business can be found. I think that there are few places to hide from the inevitable.
The influential Dewey B Strategic blog speculates that BloombergBNA might purchase Wolters Kluwer or Wolters Kluwer might purchase BloombergBNA. I doubt both, particularly the latter but what is left of Wolters Kluwer’s Legal & Regulatory division and/or its Tax & Accounting division, maybe even Governance, Risk and Compliance, would make sense in better hands. Nevertheless, I am advised that, in the foreseeable future, there is no likelihood of WK making any significant disposals, though I think that its destiny lies in healthcare markets.
For all that, lawyers, tax advisers, accountants and corporate officers will continue to demand their stated requirements in ways that match their own evolution rather than those of their suppliers, who do not always listen. Maybe now and again, on the publisher side it’s that, as if it were the U.S. political coup d’état, “the lunatics have taken over the asylum” and the publishers have become the architects of their own inevitable demise. As House of Butter’s Sean Hocking writes, “the inherent conservatism of the legal publishing industry will one day be its downfall as all the individuals with an ounce of guts and common sense are sent out to pasture”. Perhaps in despair of the law publishing business, he opines, “law firms have been missing a huge trick in terms of publishing strategies as the legal publishers decided that well researched and presented information was all in the past and its technology, algorithms and deliver that’s important. All fantastic if there’s any decent content to draw from!” Still, to some extent and in some form, customer needs have to be served, not least because an even more seductive obligation is that of liberating them from the burden of a little of their sometimes considerable wealth. So, it may be a case of “law publishing business is dead…viva law publishing”.
To avoid the words outsourced or off-shored, it appears that the biggest information providers are simply opening “operation centres/centers” in locations with low wages and low corporate taxes. For instance, in the U.S. rather than off-shoring or outsourcing these large corporate outfits simply move their operations to the southern states where wages are lower and state governments offer corporate tax incentives. So all is good, corporations can honestly say they are not moving jobs out of the U.S. and everything is great again.
Excellent piece Robert.
Thanks Jason. Interesting to read Verna Milner’s comments too. I suspect Downtown Houston doesn’t count, though.
Robert, you are right of course. The legal publishing business as we knew it has come and gone. We were fortunate to have been a part of its dramatic growth and then its transition to the digital world. Others will take it forward in new and unexpected ways. As you say, the “law publishing business is dead…viva law publishing”.
Thanks Gary. Indeed not much different from what you’ve been writing for several years, e.g. http://www.slaw.ca/2010/08/03/the-battle-for-relevance/. The “new and unexpected ways” will, I hope, be equally intriguing.
Robert, as far as the eye can see, the traditional law publishing business is gone. I suspect if we hadn’t moved to digital when we did our story would be very different now. We’ve since “stripped the covers” as I like to say and now focus on commentary and practical materials for different areas. Books are still very present, but it’s no longer a focus. Print as a medium is still important for many, but no longer drives decision making regarding products and now “solutions.”
Thanks Jason. I agree entirely with you but would go further still. I don’t think that the argument is about printed books but rather about information versus tools. The publishing business which, in my view is about creating and delivering intellectual and informative ideas has moved to a software model which processes them. The latter model relies more on the ideas being already in existence and makes the assumption that there is a lesser need for the intellectual process of creating ideas. I would argue that increasingly there is perceived to be no need to focus on generating evolved concepts arising out an evolving system of law. Hence there is no longer a commercial and profit-oriented business model to support content generation but merely a software one of which publishing is a minor and ever-reducing component part. There must continue to be an intellectual response to evolving law but I am certain that it will not be undertaken in the same way and by the same commercial entities and there are those who would seek to minimise the importance of jurisprudential thoughtfulness in law.
I’ve always thought that our very best publications addressed the developing ideas of law; we set out the practice as it is now but also suggest what it could or should be. I expect that the law reform commissions, law schools, and the courts will continue to do this work. But I’ll be sorry if it’s no longer valued as part of our work as legal publishers.
Thanks, Robert, for a very stimulating discussion!
Thanks Susan. Of course you are correct. I too would be sorry if the role and influence were to be diminished. In my next Slaw column, presently only in draft, I suggest that especially in an era of global political gloom, one needs to be grateful for the cleverness of the best lawyers and the published information and guidance that underpins them, to encourage the supremacy of law. In my opinion, it might be devastating if legal analysis became commoditised and automated to such an extent that opportunities to evolve beyond the status quo were diminished, hence the need for great jurisprudential thought that is published in some form or other. That might not, however, be the role of some that would presently be defined as law publishing businesses.
I think this may be an opportunity for small legal publishers. They will create the secondary sources of the future, the basis of all software and algoritms the big legal publishers will need.
Dear Mr.Leymonth
Thanks for reading the article and for commenting on it. I’d like to agree with you but it might be more of a wish than an expectation, in my view. Very shortly, my next Slaw contribution will appear, entitled, “Then there were two”, looking at the prospects, as I see them, for the smaller UK law publishers. They may be feeders for the bigger ones, as I suggested in http://www.slaw.ca/2015/04/24/the-future-of-legal-publishing/, though I’m not sure if I’d bet my own money on it. It may well be the case, however, in relation to emerging tech businesses, especially as we read about the likes of ROSS Intelligence. I’d separate secondary source content from software and algorithms.