Photo: Pradeep Gaur/Mint
Photo: Pradeep Gaur/Mint

Opinion | Disruption and innovation in the legal industry

Unless lawyers loosen their grip on the business of law, the profession will not see the disruption it needs

In 1990, there was no world wide web. The internet was just a network of computers that was only useful if you knew where to look. Most people exchanged data on the internet using the file transfer protocol (FTP). Files were stored on servers and if you wanted to download them, you had to use an FTP client to connect to the server on which that file had been stored. The trouble was that you had to know exactly which FTP server your files were stored on. Before 1990, there was no easy way to do that.

The world’s first search engine was built to solve this problem. It was called Archie and was literally just an index of files stored on various FTP sites across the internet. You searched the Archie index, found the file you wanted and clicked on the URL of the FTP server on which it was stored to download it. But Archie was designed to index just the title of the file. If that was not descriptive enough, you could end up downloading something unrelated to what you were looking for. For a search to be useful, what was needed was a useful way to catalogue and appropriately annotate every file on the internet.

As this was ultimately a question of how best to organize information, popular wisdom at the time suggested that librarians—since they devoted their entire lives to organizing data—would find the answer. Search engines like AltaVista and Yahoo! hired armies of librarians and put them to work categorizing and hierarchically arranging the internet. But given the pace at which information was added to the internet, human curation methods soon proved to be completely futile. No matter how many librarians were thrown at the problem, it was impossible to devise a method by which all the information on the internet could be organized manually. Ultimately, it was left to a couple of computer science graduates from Stanford to build an algorithm that automatically ranked webpages by order of importance, thereby creating the modern search engine.

This is how most disruptive change takes place. The experts we believe hold the answers to difficult questions are often so accustomed to doing things the tried and tested way that they are unable to find new and innovative solutions to problems even in their area of expertise. Disruption always comes from where we least expect it.

Much has been said about the need for innovation in the legal industry. Many attempts have been made to find solutions that smooth out the bottlenecks in the system and introduce greater efficiencies into the business of the law. Yet, despite all the clamour, there has been little headway. What progress has been made is peripheral at best—limited to simple technology solutions that improve the ease of conducting due diligence reviews or that improve the way billing is done. Very little, if anything, has been done to change the way law itself is practised.

Lawyers are the acknowledged experts in the law. If alterations are to be made as to how the legal industry must function, it is inconceivable that these changes can be implemented without their involvement in the design. What is less apparent is how much of an iron grip lawyers exercise over their profession. They determine who can practise law and how they should conduct their business. Lawyers educate lawyers and practise before judges who were once lawyers themselves. They organize themselves in bar councils that then determine how they can (and cannot) advertise and with whom they can share profits. If you receive poor service from a lawyer, you have to make a complaint to a disciplinary committee made up of lawyers with little or no opportunity to appeal.

What is the reason for this deep level of control? The answer most frequently offered is uniformity. Given the complex environments in which lawyers operate, certainty of interpretation and predictability of process ensures consistency in outcome. When lawyers share a common language and context, they are able to more efficiently conduct negotiations and effect a resolution of disputes. If one lawyer can accurately predict what another will do or say regardless of circumstance, they can both cut to the chase and find solutions in the best interests of their clients.

However, the inevitable consequence of this is that there develops within the legal system an obdurate resistance to any attempt to change the way things have always been done. This means that any new technology that has the effect of modifying traditional or customary practices gets thwarted on the grounds that implementing it would involve the “practice of law" by someone (or something) not legally permitted to do so. As a result, if innovation has to take place in the legal sector, it must do so at the margins.

If librarians had exerted the same sort of control over the organization of information as lawyers do over the business of the law, the modern internet might never have come to pass. Larry Page and Sergey Brin would have had to get a degree in library science before they were allowed to build their search engine—and even then, might never have been able to advertise to monetize their business.

Unless we lawyers can loosen the iron grip that we have over the business of law, the profession might never see the disruption that it needs and deserves. If we truly want to bring the profession into the 21st century, we’d do well to recognize that this will not happen until we get out of our own way.

Rahul Matthan is a partner at Trilegal and author of Privacy 3.0: Unlocking Our Data Drive Future. Ex Machina is a column on technology, law and everything in between. His Twitter handle is @matthan.

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