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Long-tailing the legal service: The Googlawfirm

Sunday, October 15, 2006

Hit-driven economics is a creation of an age without enough room to carry everything for everybody. Not enough shelf space for all the CDs, DVDs, and games produced. Not enough screens to show all the available movies. Not enough channels to broadcast all the TV programs, not enough radio waves to play all the music created, and not enough hours in the day to squeeze everything out through either of those sets of slots. This is the world of scarcity. Now, with online distribution and retail, we are entering a world of abundance. And the differences are profound.

Being an underdog? Worry not, the internet gives you hope. Welcome to the economy of abundance, where there is a demand for everything, everyone.

I am sure that most of you have heard about Anderson's Book, The Long Tail. But if you haven't heard it, here's a short description from wikipedia:
"....products that are in low demand or have low sales volume can collectively make up a market share that rivals or exceeds the relatively few current bestsellers and blockbusters, if the store or distribution channel is large enough..... Where inventory storage and distribution costs are insignificant, it becomes economically viable to sell relatively unpopular products; however when storage and distribution costs are high, only the most popular products can be sold".

If you look at the wikipedia's graph above, the long tail is the yellow part. Let's assume that this is a music or film industry. The red part is the Hit, bestseller singers like, say Robbie Williams, or blockbuster movies like say, Saving Private Ryan. The yellow part is for the less known singers, street musicians, amateurs, Cafe Singers, or independent movies, etc. Now, the bottomline here is, there is always a market for everyone. The traditional 80-20 power law, where 80 per cent of the market is controlled by 20 percent producers could no longer be applicable.

What makes long tail possible? First, The Internet. Second, human's psychology. Hey, everyone's unique. I like documentaries, you like war movies and the other loves drama. There's no accounting for some people's taste.

Recently, there is an article in Law.com on how the future legal service will respond to this long-tail phenomena. The article asked several important questions. Here, I'll try to suggest some possible answers:

Q: Lawyers mostly create new legal work at high cost for one client at a time. Aren't lawyers at increasing risk of competition from Internet-based models of legal service and information?

A: Yes, as they are doing this virtual online legal service thing

Q: And are they even at risk of having to compete with their own past work, much of which is now available on the Web in official and unofficial repositories?

A: As far as I know, some companies' legal departments are now looking for answers to their problems in Blawgs. It is more efficent, and cheap.

Q: What indeed will the long tail of lawyering look like? Will the power law effect that the "rich get richer" on the Internet, exacerbate existing inequality in the legal profession?

A: Could be in terms of internet companies, No for lawfirms. Traditional lawfirms are, I think, is being jeoperdized by the Internet. They still survive as they relied on (1) Trust, (2) Jurisdictional Protection (through bar exams), (3) Local Networking. Lawyering is a service business and "Trust" is the best marketing tool. This is what differs lawyering from selling books at Amazon. But, it may not last long.

Q: Will local and traditional CLE organizations be supplanted by national Internet-based CLE organizations and CLE content aggregators? If so, will speaking and reputation-building activities be drastically reduced for lawyers whose volunteer efforts have made CLE work until now?

Lawyers will speak through blawgs, I think.Q: If Internet-based services can assist clients in locating just the right lawyer, and if lawyers across firms can work together collaboratively on project teams, exactly what is the role of the law firm going forward?

A: If the legal service can be completely unbundled, then there is no need for a lawfirm. But it may take time to get there. Only until lawyers can practice in different jurisdictions, maybe. Confidentiality could also be an issue if we can work cross-lawfirm, I guess.

Q: In an era of information abundance, much of it highly pertinent to law practice, does one risk liability by not taking full advantage of it? How do rules of ethics and liability need to change to acknowledge the fact that lawyers cannot know everything, even with a good portion of the world's information literally at one's fingertips? Will tenacious clients be able to find out more about their legal problems than their own lawyers have gotten round to discovering?

A: When I talk to computer programmers, they know more about creative commons licensing than any corporate lawyers I've ever met. Creative Commons is the "living law" of intellectual property licensing, but there are some lawyers who never even heard about it.

Consider the role of tax consultants and investment consultants, they are taking the role of lawyers. Also, internet users are becoming more advanced and they have a very good personal knowledge management skill. Lawyers know better on how to wrap their arguments, they know the theories better. But, practice may not always require theories. Take for example free boilerplates provision available on the internet. Programmers just put it in their programs and launch them. But of course, there are cases when they still need alegal advice from a lawyer.

I think giant internet companies will eventually replaces lawfirms. I think both Google and Yahoo has the power to do it. Take for example, Ask Yahoo and Google Scholars. They can make a good future consultation service. All they need to do is to agregate! Google can agregate legal knowledge from various continents in their website and provide a legal service across all jurisdictions. This will certainly kill all giant lawfirms but it will help lots of lawyers to spend more time with their family :)

Email me in movanet@yahoo.com if you are interested in the concept