Monopolizing the Law

From a fascinating, must-read brand new book by noted antitrust lawyer Gary Reback, Free the Market: Why Only Government Can Keep the Marketplace Competitive.

Free the Market: Why Only Government Can Keep the Marketplace Competitive
By Gary L. Reback
Portfolio Books, 2009
*****
Chapters 14, “Storytelling for Lawyers.” and 15, “Monopolizing the Law,” clearly explain how LexisNexis and Westlaw became the market forces that they are today.
From chapter 15:
. . . The West-Thomson merger had precisely the effect that everyone, other than Thomson, the Justice Department, and the judge predicted it would.  Prices for print publications soared.  Thomson started putting fewer pages into each West volume of court cases and charging more for the books.  Price increases for West publications following the takeover exceeded both the rate of inflation and the rate of increases for prices in legal publishing more generally.  One study documented a price increase of over 70 percent for “value added” legal publications (books with supplements) in the four years following the merger.
Prices for online research also climbed astronomically.  Thomson raises rates to private firms each year.  In each of the recent years, Thomson’s charges for online legal research in the West databases have increased roughly 7 percent.  To search the comprehensive West database for state and federal decisions now costs more than $17 per minute.  The federal minimum wage, by constrast, is about $7 an hour.  In addition both Thomson and LexisNexis started charging law schools for online legal research, orginally provided free of charge.  Last year the annual rate increase to law school librarians was roughly 7%, breaking the budget of many university law libraries.
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7 thoughts on “Monopolizing the Law

  1. Its not really a monopoly, especially with Lexis, Hein and Aspen as strong competitors. What this article doesn’t take into account is the fact that print revenues from all publishers are suffering huge losses in the last 5 years. Many libraries, whether public or private, have just decided that with the Internet and online researching, its not worthwhile to keep print subscriptions. Part of the reason the print prices have gone up to some extent is because subscription rates have fallen greatly. Edison (or someone) once said “We will make electricity so abundant and and affordable that only the rich can afford to have candles” (that is a paraphrase of the quote). I think we are seeing a similar effect here. Electronic research is so affordable now, only law firms that want to maintain their prestige levels keep up their subscriptions to all the case books, etc.

    Also, keep in mind that the online services are much much more affordable then then were 10 years ago. There is a reason why only a handful of the largest law firms in the country used to have Westlaw/Lexis subscriptions and now even the smallest solo firm can easily afford one. Yes, subscription rates go up, but that 7% figure doesn’t point out that the reason why rates are often raised at law firms and law schools is because there are increasing number of users, which costs more bandwidth and IT expenses.

  2. Please speak with some law librarians about your figures — they are wildly inaccurate. Libraries are drowning right now due to the costs of serials (both print and electronic) and the ever increasing costs of database subscriptions. While it is true that many libraries are reducing their print collection development budgets, this is because their costs elsewhere have risen so quickly.

  3. David, I don’t doubt that overall costs have gone up, but what I do doubt is the cost per user has gone up, particularly in comparison to 10 years ago when only the largest law firms had Westlaw/lexis access. How many solo law firms had Westlaw/Lexis access even 5 years ago compared to now?

    I realize that there have been increases in the cost for these various services, but I also think both services have vastly improved their offerings, in particular the electronic resources. Remember how annoying it was to use either service even 6 or 7 years ago? They are much more polished, have many more tools to do various kinds of research activities thus a 7% increase in cost isn’t that outrageous, especially when you consider how many more law students and lawyers there are today.

  4. West’s, along with other publishers’, inflationary practices are indefensible, at least at the law school level. My budget has never gone up by 7%. All I can do is cut, cut, cut to keep up. Every month when I receive the West invoice, it’s “what can I cancel here?” It’s never “what should we be adding?” I am buying much less on speculation — especially products from publishers who have notorious inflationary rates — and much more on demand.

  5. Pingback: The History of CALR, Part 1: More on Thomson West and FLITE Takes Flight « Legal Research Plus

  6. Pingback: The History of CALR: Part 1: More on Thomson West and Flite Takes Flight

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