If you are a senior manager at a legal publishing company.. especially a big player we suggest you take some prozac before reading this piece at Semantic Web.com.
The precis is simply put.. …Investors are getting wary of the outlook for the big legal publishing players as a convergence of events could (will) severely disrupt revenue flows and future business opportunities for the likes of LN & TR Westlaw
What you are about to read, we know to be nigh on accurate as we’ve heard the same privately from a number of sources.
Following is the crux of the argument. We know there are eternal optimists (we might use the word “deluded” ourselves) out there who believe that it will all be alright in the end.. sorry chaps but change is on the way
Semantic Web report
Enter The 7 Forces Of Disruption
In the introduction to this series, we described the 7 factor perfect storm hitting other markets. While the headline numbers may look great, each of these 7 factors is hitting legal publishing:
Factor # 1: Digital economics.
The publishers do not own the base data, which comes from court records. These can be replicated at close to zero cost. Semantic Web technology will make those mountains of data more accessible.
Factor # 2: Generational shift in habits.
The generation of lawyers that grew up with Facebook, LinkedIn and Twitter will look for answers outside of the normal channels; particularly if a cost squeeze forces them to be creative.
Factor # 3: Globalization of markets.
Try selling content at US/UK prices when you are selling to BRIC (Brazil, Russia, India, China).
Factor # 4: Globalization of competition.
Lawyers and publishers in BRIC countries will bring price competition one way or another.
Factor # 5: Deleveraging.
In this case the deleveraging is lawyers paying off student loans when they can no longer charge really high $ per hour rates. They simply won?t pay as much for information because they cannot pay.
Factor # 6: Great Recession.
Customers are pressing legal firms for lower prices. Big firms have gone smash and many have cut back. They will seek lower costs from publishers.
Factor # 7: Regulatory change.
People in the industry are pushing for more AntiTrust action. The more radical option is Law.gov, which we will explore in the next post.
Sometimes The Acts Are Played Out Very Fast
The 7 Act Creative Destruction Play is unusual. Any playwright who tried this would fail. We tend to get a really looooooong Act 1. Act 2 is also agonizingly long for the innovators who are ahead of their time. But then we can see Acts 3, 4, 5 and 6 play out really fast. What do you mean Apple is a big music publisher, how on earth did that happen?
Investors May Sense That Something Is Up
Investors love oligopolies and the strong margins enjoyed by the big companies in those oligopolies. So their share price must be rising faster than the market as a whole? Well, no, they are not. We took the 3 companies that Kendall F. Svengalis describes as oligopolists ? Thomson Reuters, Reed Elsevier and Wolters Kluwer and looked at their share price compared to the S&P Index over 12 months, 6 months and 3 months
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Finally we know how many legal publishing types are, quite frankly; sadly lacking any awareness of? Semantics – so here’s a quick crash course
Wikipedia: Semantics[1] is the study of meaning, usually in language. The word “semantics” itself denotes a range of ideas, from the popular to the highly technical. It is often used in ordinary language to denote a problem of understanding that comes down to word selection or connotation. This problem of understanding has been the subject of many formal inquiries, over a long period of time, most notably in the field of formal semantics… http://en.wikipedia.org/wiki/Semantics
This quote by? Felix Frankfurter Associate Justice of the United States Supreme Court. should probably be committed to memory? .. All our work, our whole life is a matter of semantics, because words are the tools with which we work, the material out of which laws are made, out of which the Constitution was written. Everything depends on our understanding of them.
We’re aware that it’s computer science semantics that the article above refers to. But HOB also believes that those in legal publishing? whose job it is to make the decisions for the future of the publishers they work for and their legions of employees will have to have a firm grasp on both aspects of semantics so as to negotiate a very prickly path..a path made all the more difficult by a global recession which is changing the way law firms view the way they operate and thus the way they manage, collate and use information.