With the legal tech market now valued at $27.6 billion, it was only a matter of time before a company serving lawyers would succumb to the siren’s song of deregulation and launch a DIY service to compete with its own customers directly.
Now, don’t get me wrong: I’m not opposed to DIY services. As far back as 2005, I advised lawyers that DIY was here to stay and encouraged them to develop ways to compete with these services or maybe even launch their own. But that’s not the point.
It’s one thing for lawyers to face competition from unaffiliated sites like Legal Zoom or Rocket Lawyer that are built for and generate revenues from consumers. It’s quite another for a company like Findlaw – which builds websites for lawyers (and not very ethically, some would say) — to gin up a service that competes directly with its own constituency. What’s worse is that Findlaw also provides other marketing services like search engine optimization and lead gen — which makes it privy to the very data that it can use to channel consumers to its own DIY sites. And not only can Findlaw use customer data on the front end to attract customers to its DIY services, it can also ensnare lawyers on the backend by charging them for leads who decline to purchase DIY services, or to win back prospects that Findlaw diverts to itself.
FIndlaw’s entry into the DIY lawyer market is just the first breach in the dam. Soon (if it hasn’t happened already), law practice management platforms and lead gen sites for lawyers will look to tap into the rich source of customer data they have aggregated to compete against their own customers. Some of these companies may use the data to start their own competing law firms in states where non-lawyer ownership is allowed while others may simply sell it as a competitive intelligence product to other lawyer subscribers.
Meanwhile, lawyers can’t expect the bar associations to help them out. Findlaw and its parent, Thompson Reuters sponsor most bar associations who won’t dare risk losing lucrative sponsorships by rocking the boat. And besides, Findlaw’s conduct primarily threatens solos and small law firms which are rarely a priority for many bar associations. The Federal Trade Commission is more likely than the bars to protect lawyers from lack of transparency and anti-competitive practices.
In the meantime, solo and small lawyers must fend for themselves. This means asking vendors questions about (1) the kinds of data they collect on lawyer fees and billing practices, the duration of cases, percentage of intake success and search terms, and (2) how it will be used.
And most of all, steer clear of Findlaw.