Why do LexisNexis and Westlaw have a monopoly?

I'll share my thoughts, having worked for LN many years ago (back when it was called Mead Data Central, starting before NEXIS even existed).

MDC, based on a project started in Ohio, began building LEXIS, libraries of state and federal court decisions and related materials. Addition of materials started slowly-but-steadily and increased speed over time.

After a few years, West saw that its hard-copy position was being threatened, so it started Westlaw. At first, its search capabilities were noticeably more feeble and its collections were more limited, but Westlaw eventually became competitive.

I believe the answer to your Q (BTW, they constitute a duopoly, rather than a monopoly) lies in the following:

  • It takes a huge amount of money and time to build the extensive, integrated, organized, specifically-searchable collections that these two services have. Anyone who started trying to compete now would have an insurmountable burden.
  • Contrary to your assertion, not all of the materials these services offer are available to the public [for free elsewhere].
  • Lawyers who need to do research appreciate having everything (including citators such as Shepard's) in one place.
  • Lawyers who use these services a lot do not mind paying for them because, directly or indirectly, those lawyers' clients end up footing the bill.

I rarely need to do legal research. Sometimes I just do Google searches. Occasionally, when I need to use one of those services (e.g., to obtain a case that I cannot find anywhere else), I do so by credit card.

4 Replies to “Why do LexisNexis and Westlaw have a monopoly?”

  1. Great answer from Dana H. Shultz (read the comments too). She mentioned what I think is the main reason. The "drug dealer" business model:

    Introducing the system via law schools. (Students first learn to do research using books, then they get to use LN and West, which are made available to law schools at a comparatively low cost. In my opinion, if the new service is not made available, taught and supported in law schools, it will never be more than an also-ran.)

    The first one is free, but the rest will cost you.

     The first thing I did when I was hired to do in-house work at company with a tiny legal department is to ask for a Lexis or Westlaw subscription. I was trained in law school to use it and do all my homework with it (and never using  the law library for actual legal research), so of course I am going to want it after I leave school. I was trained to be lawyer using these specific online services.

    That said, I also share other's opinions that this area is ripe for tech disruption. I am more than happy to switch if it makes my job easier.

    As a sidenote, I believe that is why Microsoft offers cheap/free student licenses for office.

  2. Because the Government doesn't publish law in a structured, open, transparent manner.

    The question implies another – is this duopoly situation good or bad?

    It is bad in that it is a moat for the legal profession itself. It is hard for individuals, whether researching for themselves or as activists or for their small businesses, to learn how law works if the basica materials are hard to find and expensive.

    It is hard for startups to innovate on top of the proprietary information. Think Quora-like systems, or social network systems, on top of structured legislative data. Think github-like historical views of changes to the law. And no doubt much more…

    In the end the Internet will disrupt the legal profession, reducing the costs of routine law and accessing basic knowledge.

    Right now lawyers are often just bad user interfaces to unnecessarily obscure law. Fixing that will give lawyers time to do what they really should be doing – brokers to hustle to make larger, more important deals work (down to their complex detail).

  3. What Dana said. The firms form a duopoly, held in place by two barriers to entry: comprehensive content; and siloed metadata.

    I can offer an extended side-note based on personal experience. I am coordinating a project to develop Zotero styles for legal referencing, at the CitationStylist site. When complete, the tool will require structured metadata, which Zotero normally acquires directly (and automatically) from online sources. This won't work very smoothly for us in the short term, for two reasons. The smaller reason is that, as other respondents have indicated, neither of these leading publishers supply structured metadata or unique identifiers in their pages. The larger reason is that their terms of use specifically ban creation of an "archive" using site content, which is precisely what reference management tools like Zotero are designed to do. So this is not purely a matter of market preference: the firms are aware of the potential for competition, and their Terms of Use are designed to forestall or weaken potential challenges to their business model.

    Another, less prominent duopoly exists in the citation domain, in the US legal market. Because there is no system of unique identifiers for cases and statutes (think DOI or ISBN), the standard-form citation is the only way to identify a case across services (Lexis, Westlaw, Fastcase, Bloomberg, etc.). Standard citation forms are currently set by The Bluebook, which has a minor competitor in the ALWD Manual. The citation forms defined by the two are essentially identical (ALWD self-consciously shadows The Bluebook). These particular citation guides are incidental beneficiaries of the curious lack of standard unique identifiers for primary legal resources, and they, too, have an exclusionary bent — I myself have been banned from accessing The Bluebook Online, specifically because of my work on implementing the Bluebook/ALWD style in unrestricted, publicly available code.

    It is worth noting that, in my own experience at least, this "exclusionary bent" appears to be closely related to the proprietary domain in the US environment. In the CitationStylist project, collaboration with open-access publishers and with citation style maintainers in other jurisdictions has been much smoother, and is proceeding apace.

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