"Disruption" in the Legal Market: It is the User That Matters (not the Lawyer)

There is a debate as to whether disruption is already happening in the legal practice, that is it coming, or that it ever will.  Folks who talk about this often get labeled “futurists” or “new normalists.”  Those who discount this talk and state that nothing really is happening in the legal markets are said to have their head in the sand, represent incumbent interests, or are simply curmudgeons.  Recently Sam Glover opined on this topic during the ABA Techshow.  Jordan Furlong penned a response shortly after.  In reading both, I found myself agreeing while also drawing a deeper distinction. 

The legal market is not one big market – it is combination of a number of sub-markets and fragments (such as supply-side (law firms and lawyers) markets like expert tools, marketing, and technology and demand-side that is easily broken into consumer, corporate, and government).  Sam’s main point is that disruptive innovation (which he actually defines instead of just throwing around) has not yet come to the legal practice.  If it has, it has only been at its edges.  He compares the devastating impact of Netflix on Blockbuster to the change in legal research providers as an illustration that there has been no Netflix moment in legal.  While I agree generally, the problem is that the legal market is not so neatly defined as the DVD rental market is. 

The key to remember is that while lawyers may not see disruption; that is more or less irrelevant.  The true test of disruption is the customer’s (a.k.a. user) opinion.  The law and the legal practice does not serve the lawyers, it serves the customers.  Sam hits on this when he talks about there being no threat to lawyers actually representing clients.  The role of the lawyers in a client’s matter is irreplaceable and the coveted attorney-client relationship is one of the last standing social and professional bonds that allow for the purest advice and counsel.  These should never be replaced.  But that is only a small fraction of what today’s lawyer actually does or better yet, what the average customer actually needs.  It is in outside of this area where disruption is and will continue to occur and where the customer is experiencing greater access to law services, legal information, and simply - easier access to lawyers.

I am a business designer so I always begin my analysis of a business model from the perspective of the user.  Note in Jordan’s post the comments of Susan Cartier Liebel, “The confluence of events . . . will conspire to ‘disrupt’ the way consumers ‘think’ of legal services.”  The key here is to focus on what the consumer is experiencing. These can be individuals, groups, organizations, NGOs, or governments – call this the mass market.  Lawyers and other legal professionals are users of a different kind – they use the law as a tool and use a number of related tools to inform and craft their work. – call this the expert market.  These two groups experience the law wholly and completely differently. 

By taking the mass-market perspective, one can see that disruption is present in the market.  The entire legal market need not be replaced in order for disruption to occur – rather a segment of the market – or sub-market can be experiencing disruption.  Some brief examples follow:

FairDocument is a startup that is focused on changing the ways customers engage lawyers in creating wills and estates.  Think of them as the hybrid of LegalZoom’s canned legal instruments and “this is not legal advice” disclaimer with a small or solo practice that focuses on this niche but lack scale to reach a broad audience.  In many ways, FairDocument is the right-sized approach to this customer need – low-cost product backed by an actual lawyer and protected by the attorney-client relationship.  What is this disrupting?  The mass market that is not comfortable with a pure play online experience but wants to avoid the transaction friction and cost of a typical lawyer engagement.  From the lawyer’s perspective, this is altering part of a solo’s or small firm’s business model and cost of acquisition of clients.

Lexspot is another startup that has focused on a specific niche and may be disruptive in its own way.  It provides the first marketplace where consumers can learn about their immigration options, compare flat fees across lawyers, and “unlock” 30-80% savings on legal fees using its technology. This online platform empowers users to educate themselves and complete portions of legal work themselves, thereby enabling lawyers to significantly reduce fees while still providing quality legal representation.  This service works with lawyers (not against them) creating an lower friction impact for both the consumer and the lawyer. 

Kunvay is taking the often overlooked but critical task of transferring ownership of copyright and IP in the creative online marketplace and flattening it while increasing awareness of this legal need. 

So, I am not sure if Sam is rooting for disruption or not.  But I do know that lawyers in general should be rooting for disruption as it has a tendency to create new opportunities and new markets.  The key asset that lawyers have is that while this change continues, they retain the fundamental attorney-client relationship– something no technology or process can substitute – and one of the most powerful user-centric devices in any market.  If lawyers are smart they will participate in the disruption because their position could be strengthened.  Or simply put, they may be able to have their cake and eat it too.

Joshua Kubicki3 Comments