Since its inception in 2009, Uber's primary opposition has been the law. In municipality after municipality, governments have sought to ban or limit the company from doing business, though many have ultimately relented. Most recently, the California Labor Commissioner's Office ruled that an Uber employee should be classified as an employee, not an independent contractor, potentially putting the company's whole premise in doubt.
Uber may have the last laugh, though. While the ride-sharing company hasn't announced plans to launch a business aimed at lawyers, the Uber model could inspire a similar overhaul of the legal profession, which has been estimated to be worth as much as $400 billion. There's nothing sinister about this. Rather, it reflects a marketplace inefficiency that could be remedied with a better tech-driven vehicle for connecting clients with lawyers.
Lawyers may not like this development, but they should embrace it - even if for no other reason than because they really don't have a choice.
Choosing a Lawyer
Like a plumber or an electrician, getting a lawyer isn't top-of-mind for most people. Instead, most people wait until some incident has prompted the need for a lawyer. For instance, if your neighbor's tree falls in your backyard and destroys your $2,000 shed and part of your fence and that neighbor refuses to pay for damages, you may find yourself in need of an attorney's services.
How do you go about that? The time-honored way is to ask around, but chances are you'd prefer a specialist (as in property law in this case) rather than a generalist and the odds that someone you know knows the right specialist are slim.
What then? Years ago, you might have consulted the Yellow Pages. These days, you go to Google.
A 2013 survey by the law firm Moses & Rooth, for instance, found asking a friend is still the primary method of finding a lawyer. Some 34.6% of respondents say they use this method. Next on the list is visiting a search engine like Google or Bing (21.9%) followed by "ask my current lawyer." Around 10.8% of people still consult the Yellow Pages. Just 2.1% go on a social network to ask.
When seeking a specialty lawyer though, search engines are No. 1 with 32.2% compared to 32% for "ask a friend." The survey also shows that for younger consumers, search engines are the primary default for searches for attorneys. (When searching, consumers also much prefer the term "attorney" over "lawyer," according to a 2010 analysis.)
Once consumers find some names of lawyers, they search them further for reviews and visit the attorneys' websites to get a better idea of their level of professionalism. Some also consult Yelp, though not so many, according to the 2013 Moses & Rooth report. Though social networks scored low on the survey, two years ago is a long time. As the population ages out, social networks may become more of a factor in attorney searches. However, the personal nature of some legal issues, such as divorces, will likely limit the utility of such networks as a mechanism for search.
Models from Other Professions
The way we search for attorneys is antiquated compared to other professions. If you want a local contractor, for instance, there's Angie's List, which provides local reviews on such professionals. Angie's List only lists reviews attached to real names and purports to prevent companies from reviewing themselves and competitors. The service is subscription-based and charges a nominal fee ($9.99 a year in the New York area).
An alternative to seeking a local handyman is Thumbtack, which connects consumers with local contractors, who submit bids for jobs. The site is free, but Thumbtack takes a cut of transactions.
If you're looking for a doctor, meanwhile, chances are you do so through an HMO. Consumers may not love the process (and doctors certainly don't), but an HMO vets doctors on your behalf and connects you to a local generalist or specialist.
Even the medical profession is in danger of being Uber-ized, though. Pager, a startup, promises to get you a house call with a doctor in two hours. Pager is now available in New York and San Francisco.
Attempts to Shake Up the Legal Services Model
Though often portrayed as being cloistered from market forces, the legal profession has already embraced its share of The World is Flat globalization. Legal Process Outsourcing (LPO) gives clients the opportunity to outsource legal work to India or other areas of the globe where fees are much lower. LPOs can also apply in the U.S. though. If you need a lawyer to make a court appearance on your behalf, you can find one with an LPO.
Still, for the average person, finding a lawyer is much more difficult than getting a ride from Uber.
That makes sense from a certain standpoint. If you want a ride to the airport, you don't really need to know that much about your driver, except that he has a clean record, safe vehicle and has treated his previous riders well.
With attorneys, you need a bit more information. What's her trial record like? What's her area of expertise? How long has he been practicing? Does he return phone calls and emails? What are her fees like? Are his clients pleased with the service and outcome?
That's why, lacking an HMO-like organization, the market seems to be demanding that lawyers need something between Uber and Yelp, with a bit of Angie's List and Thumbtack thrown in.
Many have tried. Firms like the 14-year-old LegalZoom and comparative newcomers Nolo and Rocket Lawyer, have attempted to put contracts and other DIY tools into consumers' hands. As Consumer Reports pointed out, though, such services may ultimately cost more in the long run. Then there's Shake Law, a mobile-based service that lets the layman draft legally binding contracts in, presumably, the time it takes to shake hands. Shake hasn't been around long enough for us to see the outcome of those contracts and any resulting claims. Only time will tell.
If a consumer has an issue that requires a lawyer, there are other tech-based options as well. Priori Legal provides a network of lawyers at a discounted rate and promises "vetted lawyers at transparent prices, straight to your inbox in under an hour." The firm I founded, and others like it, have been doing that for many years for businesses. Nothing new there except the consumer-directed focus which is useful. UpCounsel lets you post a job and get free proposals, a la Thumbtack. HireanEsquire is another mechanism for a legal marketplace.
Still another in this space is Avvo, which has been around since 2006 and provides unsubstantiated ratings, as well as reviews and disciplinary records for lawyers in all 50 states. Clearly, some venture capital firms believe that there's a future for disruption in the legal market. Last year, VC firms sank $150 million into primarily consumer-focused legal startups in 57 venture rounds, according to TechCrunch.
The Relationship Algorithm
Why have none of these solutions managed to create that revolutionary Uber moment in legal, though? What secret sauce is missing? The relationship component. Relationships with attorneys are built on trust. There is a personality quotient that factors into the selection process that is irrelevant when selecting a taxi driver, plumber, painter or similar non-professional service provider.
In some cases, such as divorce or estate planning, the knowledge that an attorney has of his client's life and family are so intimate that the selection process for such an attorney can be agonizing and time consuming for these clients. A relationship algorithm would have to assess personality, credibility, authenticity, and character. An algorithm that accurately assesses a human being's character? On what basis? Against what standard and moral paradigm? Good luck with that. Simply the idea of judging one's character algorithmically is morally offensive to normal people. If someone can invent ethically sound and accurate relationship science, there are far greater challenges to be solved in society than access to legal services. That is what's missing, though, and until that piece is solved or at least, partially solved, via artificial intelligence, pattern recognition and more, it will be challenging to deliver upon a truly Uber-like model for the legal market.
There are certain specialties and types of work within the legal market that require less relationship science such as a corporate filing or a trademark filing, etc., but such tasks are becoming more standardized anyway and ultimately, will be largely automated, obviating the need to hire a lawyer altogether.
The New Reality for Lawyers
So far, no one has had a major impact on the legal market. That doesn't mean they won't, though.
One reason is that law is a profession that's not obviously adaptable to the Internet the way, say, booking a flight is. That was also true, until recently, of taxi rides, though.
For Uber, the paradigm shift was the mass adoption of smartphones, which suddenly gave the average person a mechanism for hailing a ride anytime, from anywhere. Google Maps and GPS also helped this process.
For the legal profession, there's no obvious impetus except for the existence of Uber. Uber has been such a huge hit that it has prompted entrepreneurs and investors everywhere to think of an "Uber for X." As Inc. magazine recently noted, there's an Uber for everything from massages to pet sitting to medical marijuana. The legal profession seems like an obvious candidate as well.
The "Uber for Lawyers" may not actually look that much like Uber. It would likely need a bit more vetting and reviews to be practical. A mobile aspect would also be handy, but it would probably have to be equal parts desktop and mobile, since looking for a lawyer is a very considered purchase and not something you do spontaneously and impulsively.
What does this mean for lawyers? As has been the case with other professions, this new arrangement will disproportionately reward those who are adept at marketing themselves in social media. Lawyers with large followings who have written or spoken on a variety of topics will have a natural advantage over those who have been more reticent. This also opens up more opportunities for lawyers to become independent contractors and not be beholden to a particular firm.
Such lawyers will be part of a larger trend. By 2020, some 40% of the U.S. workforce will be freelance, according to a study by Intuit. That's up from 30% in 2006.
The On-Demand Economy
On-demand. It's a catchphrase now. I started using this as a tagline for my firm, ZentLaw, in 2002 and now everyone is using "on-demand" for everything. My use of the term came out of my background in the entertainment industry.
The term was used for on-demand programming in its early days. My work in TV and as a lawyer in the early days of cable gave me a keen understanding of the term. Years later when I opened the firm, I used on-demand to refer to the fact that our clients could get in touch with a ZentLaw lawyer anytime, anywhere for anything they needed. It took off as a marketing concept and has proven staying power leading the pack of followers who use the term now to market their own legal services outfits and legal tech offerings.
With the increasing number of freelance lawyers and growing segment within legal of lawyers in solo practice, these lawyers will be available to perform work as and when needed, especially in areas or during periods when demand is weak.
Right now, we have a saturation in the legal market of professionals with average job growth on the horizon. Uber has brought the on-demand economy to the forefront of a debate about worker classification. That topic is not resolved as of this writing but what does this mean for the legal industry? Lawyers and similar professionals often can't unionize. Yet, will they work as temp workers without benefits, expenses, liability insurance coverage? It's already happening through staffing agencies such as Axiom. If a new category of worker is created, though, will that apply to law?
Professionals are presumed to have greater autonomy than non-professional workers and therefore may not need the protection that an additional worker classification affords. If they have such
protection, will that price lawyers out of Uber-like referral marketplaces? It could.
The average lawyer earned $131,990 in 2013, versus $47,230 for the average worker in America. If lawyers do not have such protection then will lawyers work for an Uber-like referral marketplace? Will they be nearly forced to do so as doctors were under HMOs? If so, then lawyers' earning power will sharply decrease as it's corrected and standardized by what the marketplace provider chooses to pay as opposed to what the lawyer chooses to charge.
While some lawyers will be proactive about cultivating a network and social media presence, others will assume that business will not really change. While no one knows for sure, make no mistake, an "Uber for Lawyers" is coming. The sooner the legal market realizes this, the better. In fact, savvy lawyers should make every effort to keep tabs on when such a product or service emerges. The future is coming. As local fights against Uber have demonstrated, you can only fight it for so long.