Category Archives: Regulatory changes

Plain packaging, lessons to learn from the (possibly) coming tobacco identity crisis

I recently enjoyed a debate with an economic consultant friend of mine on the implications of plain packaging for cigarettes.  As an occasional smoker myself, I was very interested in what proposals to restrict branding opportunities for manufacturers might mean for my own habits.

A study by the British Brands Group found that removing on-pack branding would “make it harder for consumers to identify the brand at the point of purchase” and that “This has the potential to distort competition by focusing attention on price rather than quality, opening up the prospect that a regulation intended to reduce demand might perversely increase demand and sales if the intensification of price competition leads to lower prices and reduced average quality”.  Although increased demand might sound promising for the industry, the authors suggest that not only would the tobacco sector lose out  from smaller revenues, but so would the government, through a reduced tax take.

An important policy consideration identified by that study is the problem of parasitic copying, and the crucial role of regulation in protecting intellectual property: “the branding and packaging investments made by established brands can be undermined by copycat products free-riding on these investments and diverting sales … so distorting competition”.  This reminded me of a series of adverts I’ve noticed recently, I caught the below image in the New Statesman, and it was also in the Daily Telegraph:

The point being made by Japan Tobacco International was that plain packaging will make it more difficult to identify counterfeit cigarettes.  The ad argues that this would “be a dream for organised crime, but a nightmare for everyone else”, noting that fake cigarettes have been found to contain undesirables such as ground glass and even rodent faeces.  In the same edition of the New Statesman, Imperial Tobacco had taken out a full page advert, claiming that plain packaging will “make life easier for counterfeiters” and threaten the livelihoods of those directly employed in the supply, distribution and retail of tobacco.

On the other side of the debate, the Guardian offered an interesting perspective recently, arguing that “introducing plain packaging for cigarettes could certainly help to reduce the brand marketing appeal of cigarettes to teenagers”, and so stop them developing a habit in the first place.  The article points to research by the University of Stirling’s Management School, which led to a government consultation on standardised packaging.  That research is far too comprehensive to summarise here, but some of the issues it highlights include five ways in which the visibility of branded packaging may function as a marketing tool:

  1. By acting as an advertisement at the point of sale
  2. By making cigarette use appear ubiquitous, and more normal to consumers
  3. By inciting cravings in smokers who want to quit
  4. By ensuring long term loyalty from new users by “providing favorable and compelling images they can continue to experience”
  5. By reducing the effectiveness of health warnings, by reducing their potential size, and due to competition from ‘eye-catching’ logos

Conflicting views abound, and the findings of the British Brand Groups’ study, mentioned above, were echoed by London Economics in a report which found, by employing online simulation techniques, that “If consumers can’t differentiate between brands in the market, they opt for cheaper brands, whether it’s beer, cigarettes or almost any other product. If manufacturers respond by competing on price to maintain market share, prices may decline.”

So, perhaps intuitively, as prices are reduced traditional thinking suggests that demand will grow.  I’m no economist, but from my own experience I suspect that, if I found it more difficult to identify premium brands, and was less affected by their marketing at the point of sale, then price would have a greater impact on my decision.  As a result I might tend to buy cheaper cigarettes, and have no difficulty in accepting that this means I might buy more cigarettes.  On the other hand, I also believe I get satisfaction from knowing I’ve opted for a premium brand, and I’m sure the appeal of the packaging holds some sway in my decision.  Which of these factors will have the stronger impact I don’t know, but it’s a moot point given that I’ve made up my mind to try and stop altogether, and hope to have done so before plain packaging arrives.

Opinion is clearly divided on the economic implications, but a common thread throughout is the resounding importance of branding.  There is an important lesson hiding in plain sight here – though much of the comment is focused on how effective standardised packaging will be in reducing tobacco consumption, the more widely applicable analysis tells us how vital it is to growth, or even survival, that businesses are free to differentiate their products from those of competitors.  On the one hand, a failure to differentiate yourself may mean a race to the bottom on price, increasing demand but destroying your margins, and on the other it risks hampering sales and loyalty because your products are less memorable, and lose some of their glamour.

It is surely a good idea to tackle smoking, and standardised packaging may or may not be one way to do this, but for businesses which are not subject to such regulation, what is clear is that ownership of your brand, as secured through trade mark registration, and the freedom to leverage that brand to set yourself apart from competitors, will help you to get ahead.

Aggressive Protection of IP, and the High Court ruling on the Digital Economy Act

The IPKat, reporting from the Fordham IP Conference, recently noted the upbeat tone of the keynote delivered by Victoria Espinel, White House IP Enforcement Coordinator.  While new technology may have rendered effective copyright enforcement a daunting prospect, and in the minds of some a losing battle, Espinel’s keynote at the conference, and the Obama Administration’s recent White Paper strike a different chord.  Indicative of the new low-tolerance approach to IP infringement, are the words of Preet Bhara, U.S. Attorney for the Southern District of New York:

Aggressive protection of intellectual property is essential to America’s current economic prosperity and future success

Proposals aimed at clamping down on IP offences by the Obama Administration in the White Paper on Intellectual Property Enforcement Legislative Recommendations are varied and far reaching, recommending a raft of changes including:

  1. The use of wiretaps in cases of copyright and trademark infringements
  2. Clarification that unlawful streaming of copyright material is a felony
  3. More serious penalties for repeat IP offenders
  4. The creation of a new US right of public performance for works broadcast over-the-air

These are just some of the proposed reforms aimed at tackling what some consider to be an increasingly relaxed public attitude towards piracy and IP infringement.  The problem of how to enforce copyright online is significant to businesses in a wide range of fields, and a proper understanding of the relevant issues can be a considerable advantage when deciding if, and how to distribute content.  This is the motivation behind an upcoming webinar to be delivered by Azrights: Controlling Copyright in the Cloud.

Digital Economy Act Update

Meanwhile, the UK High Court recently rendered its opinion following the application by BT and TalkTalk for judicial review of the DEA and Copyright (Initial Obligations) (Sharing of Costs) Order 2011.  You might recall that our earlier post touched on the compatibility of the Act with European law, now the results are in (the case report is available here).

Of the objections raised by the Telecoms providers, only one was accepted by Justice Kenneth Parker, while four claims were dismissed confirming the courts view that the law is consistent with European legislation. The successful claim concerned an obligation on ISPs to bear a proportion of the costs involved in implementing the new legislation, and a number of parties have expressed dissatisfaction not only at the rejection of the remaining issues but at the degree of success that this claim enjoyed.  While elements of the charges to be borne by ISPs relating to Ofcom’s setting up, monitoring and enforcement of the rules were found to be unlawful, the judge maintained that they would remain liable for a significant proportion of the costs of operating the system and the appeals process – a burden likely to lead to higher prices for consumers, possibly to the extent that tens of thousands of people may be excluded from faster broadband access.

Data Protection

Of particular interest to this writer, is that the Judge makes the case for the classification of IP addresses as personal information.  The reasoning behind this is that, despite the IP address only identifying an internet connection (or an internet subscriber) rather than a particular user, it may still constitute personal data because:

the subscriber, who can be identified through the dynamic IP address, is inevitably linked to the data … as the person who, in a broad sense, has facilitated the infringement.

The suggestion here is that IP addresses, coupled with information about the time particular material was accessed by a subscriber assigned that address, may themselves be protected under Data Protection law.

Image courtesy of opensourceway, click the image for their page on Flickr

This ruling is a significant blow to opponents of the Act, but the AG’s opinion in Scarlet v. SABAM, continuing efforts by the Open Rights Group, and the possibility of appeal by BT and TalkTalk mean that the future of the Act is far from certain.  The Initial Obligations Code, which sets out in more detail the operation of the Act, has yet to be published, and the Costs Order will now need to be reviewed in light of the decision.  So, it is likely to still be some time before we can expect to see the full impact of the law.

Start Up Britain and Regulation: A Balancing Act?

270,000 businesses start up in Britain every year, and the new Start Up Britain intitiative hopes to promote entrepreneurship by offering reading material, business resources, discounts and a variety of other assistance.  Some legal resources are also available, to help new businesses steer a clear path through swathes of regulation, manage risk, and to offer some rudimentary assistance in protecting their intellectual property.  That these resources form part of a Government backed initiative to encourage entrepreneurship is telling.  Getting the legal advice necessary to manage risk, and ensure compliance, is an important and often expensive precursor to launching a successful business; one area of regulation we have written about before is data protection.

Proposed reforms to data protection law in Europe, including the right to be forgotten online, and changes to laws which affect when cookies may be stored and accessed by websites, are aimed at developing a “comprehensive set of existing and new rules to better cope with privacy risks online”.  However, while entrepreneurship is hailed as a means for economic recovery, over regulation would certainly represent a significant obstacle  to start ups.  While the barriers for entry to the online marketplace have traditionally been very low, and while web based businesses have been relatively free to design their systems and user experiences as they wish, these freedoms are increasingly weighed against the privacy of users.

Regular scandals serve to highlight the importance of more effective safeguards on the use of personal information, for example the loss of address, bank, and national insurance details for 25 million people in 2007; a BP laptop going missing with personal data for thousands of oil spill victims on board last month; and the exposure of names and email addresses following a cyber attack aimed at Epsilon, who provide e-mail services to several high profile businesses.  There is good reason for concern over the safety of information we provide online, but notably, in each of the cases mentioned here, the exposure of personal details was not necessarily attributable to a lack of consent or misuse of data, but to a breach of security.

Freedom to do business online must be balanced with controls on the use of data, especially as the growth of social media sees more and more interaction taking place on the web. However, if the scales are tipped too far one way or the other, regulation may have a severe negative impact on businesses, or the privacy of web users.

Following the increase last year in the maximum fine which can be levied by the ICO from £5000 to £500,000 and calls for the law to provide mechanisms for enforcement against global companies, the growing reach and impact of data protection law means a steadily increasing burden on website operators to obtain consent for the collection of visitor data, to control its use, and to control access to it.  While compliant businesses are likely to develop trust, and while stricter rules may give web users greater peace of mind, it might be argued that education could play a more significant part in preventing breaches of privacy online, and reduce the need for regulation.  It will be interesting to see whether the reforms strike the right balance, and allow entrepreneurship to thrive, or whether they eventually raise the bar to entry such that only larger players have access to the market.

Niche Firms for Legal Process Outsourcing and White Labelling

Last week Azrights announced the launch of its trademark registration white labelling solution for law firms.  It is the first comprehensive trademark white labelling service for UK law firms.

UK Regulatory considerations

The impetus behind it was the Solicitors’ Code of Conduct Rules 8 and 9 which prohibit fee sharing with non lawyers, and regulate referral fees.  These rules complicate solicitors’ ability to benefit from trademark registration work which they are often in a position to refer to others.

To run an effective trade mark registration service requires investment in IT, and other resources.  Many law firms offering such services have difficulty doing it cost effectively, and price competitively.  Their high charge out rates, and culture of invoicing larger sums generated from litigation, make it difficult for them to make money from the relatively modest amounts invoiced for trademarks.

Azrights introduced its white labelling service for two types of firm.  The first currently do not do their own registrations.  A virtual department would generate an additional income stream for them without an accompanying increase in overhead costs.

The second type of firm offers trademark registration services and may be looking to outsource the work in order to  focus its resources on more profitable, higher skilled work.  Legal Process Outsourcing is a much bandied about concept nowadays because law firms are under increasing pressures to reduce their costs.  So, it’s worth considering what is the difference between Legal Process Outsourcing (LPO) and White Labelling.

White labelling and Legal Process Outsourcing (LPO)

According to Wikipaedia a white label product “….enables a successful brand to offer a service without having to invest in creating the technology and infrastructure itself”.

The FSA defines white labelling as arrangements where a product or service is offered under the brand of one company (the distributor) while a separate company (the producer) actually makes the product or provides the service……. “White labeling allows producers access to a wider market than they would otherwise reach, and allows distributors to offer a wider range of own-branded products or services”.

According to wiki LPO is the practice of a law firm or corporation obtaining legal support services from an outside law firm or legal support services company.  When the outsourced entity is based in another country the practice is sometimes called Offshoring.

So white labelling might be a more complete solution, while LPO may just involve a discrete aspect of legal work being outsourced to the LPO provider.  Taking trade mark registration as an example, white labelling will deal with every aspect of the work, from beginning to end, while LPO may cover just specific aspects of operations, such as renewal of trademarks.

The continuing pressure on legal fees, the scope of SRA regulations, and consequent search by firms to find more cost effective solutions, points to law firms looking at solutions right on their own doorstep.

Why use a niche UK law firm for LPO or white labelling?

It is preferable for UK law firms to look to niche law firms in the UK when searching for the cost reductions that LPO can offer.  Lora Bentley, across the pond, expresses a similar opinion in her post Need to Outsource Legal Work? Try Boutique Firms in U.S. First

For example, by using the Azright white labelled trademark registration service UK law firms benefit from the investment in technology, and expertise that Azrights has built up over a number of years.  They get access to highly skilled help without the concerns that LPO as such entails.

Given they’re outsourcing the work to a regulated law firm in the same jurisdiction, few  concerns about quality and reputation that are usually associated with LPO arise.

Legal work requires a specific education, and training, and is regulated.  So, why send the work to other professionals whose rules are dissimilar to those of solicitors, let alone to overseas lawyers who are not educated in English law?

Often offshore LPO providers use as a selling point the fact that they have highly qualified lawyers whose hourly rates are a fraction – one tenth – that of a solicitor.  However, if paralegals in this country are well managed and supervised, and work in a process supported by effective technology and senior lawyers, they are, in my view, better able to offer the quality required by a UK law firm.

It is a mistake therefore to compare the hourly rate of an attorney in India or other offshore location with that of a UK solicitor in determining the savings that may be made by a successful outsourcing LPO provider.  If the work being outsourced is relatively low level and repetitive, or is administratively intensive, then it does not need highly skilled lawyers.

Indeed is it beneficial to use the services of highly skilled lawyers who may be over qualified for low level tasks?  I would worry they would get bored and prove less efficient.

On many types of work that are outsourced it may therefore be more appropriate to compare rates with paralegals in this country.  A very affordable service can be provided in the UK by a law firm that knows how to use IT, and different skill levels within an efficient process.  Access to IT and use of good management and supervision are key to LPO success.

A niche firm within the same jurisdiction has the specialist skills and experience to run an efficient operation much more cost effectively than non specialist firms or larger law firms.  Being subject to the same regulations it is therefore a safer place to entrust compliance with regulatory obligations by outsourcing law firm.

In the UK we currently have a surplus of well qualified law graduates, motivated to get experience.  Could it be that Richard Susskind’s End of Lawyers? is wrong in its assumption that LPO will go offshore, leaving a dearth of training opportunities for future lawyers in this country?  Perhaps Richard Susskind would have benefited by taking a closer look at smaller law firms, and the quality of personnel available to them due to the oversupply of law graduates seeking to train as solicitors.

Find out more about outsourcing, and our whitelabelling service on our website:

Whitelabelling for solicitors

Recipes, Rights and Repercussions

Copyright is a hot topic at the moment, especially following the PM’s announcement that UK copyright law is to be reviewed with a view to potentially incorporating fair use provisions along similar lines to those in place in the US.  This blog has covered copyright online a number of times before, in the context of peer to peer software, piracy, and the activities of anti-copyright campaigners.  It has generally been the case that the masses will respond and attack attempts to enforce copyright rather than the other way around, Operation Payback is a recent example of this and serves to illustrate the formidable impact that organized dissent can have online.

On the other hand, circumstances are relatively few and far between where the party seeking to enforce their copyright receives the support of the online community, but last week swift reputation assassination was the price paid by Cooks Source magazine for either ignorance of, or blatant disregard for, copyright law.  This is an issue touched on briefly in an earlier post, but something deserving of further exploration.

Blogger Monica Gaudio was congratulated by a friend for getting an article published.  Something of a shock to Monica, she had never heard of the magazine, and was quite taken aback to discover that they had reproduced one of her recipes without even contacting her.  The fallout might have been controlled if it were not for the point of view taken by the magazine editor, Judith Griggs, in responding to Monica’s request for an apology, and compensation:

the web is considered “public domain” and you should be happy we just didn’t “lift” your whole article and put someone else’s name on it! It happens a lot, clearly more than you are aware of, especially on college campuses, and the workplace. If you took offence and are unhappy, I am sorry, but you as a professional should know that the article we used written by you was in very bad need of editing, and is much better now than was originally.

What I find interesting in this case, is that despite taking no legal action to enforce her rights, the blogger to some extent achieved everything that bringing a lawsuit could have, and in far less time: she has received donations to cover her blogging expenses; the positive publicity gained is very likely to have an impact on her readership and could feasibly be monetised; her authorship has been firmly asserted; and the infringers have been punished.

The issue has been picked up by a variety of publications, including the Guardian, NPR, and a number of popular blogs, and the magazine’s Facebook page has been inundated with a constant stream of negative comment ever since.  No longer just a means of communication or entertainment, Facebook is big business (even the Queen has an account, adding to the existing presence of the British Monarchy on Twitter) and the repercussions of such an onslaught are likely to be significant.

These events should serve as a sobering reminder that copyright law is not something to be overlooked, and that to do so can have a considerable impact on a business.  They are also possibly a sign that the traditional approach of taking legal action to combat infringement may become marginalised in some cases, and that in the future more innovative strategies may prove more succesful, and cost effective.

Legal Services and The Latent Legal Market, Signs of Change?

Yesterday in our November newsletter we mentioned the Legal Services Act (sign up to receive future editions using the form on the right), and how from October 2011 the Act will allow non-law businesses to own a stake in law firms.  This is expected to signal the full entry into the legal services market of companies like Barclays, the Co-op, and AA.

So, it was interesting to read on Neil Rosen’s Legal Futures blog about the announcement by AA and Saga of the range of legal services on offer to their members.  Members who have taken out legal expenses cover will have access to some legal documents including wills and prenuptials, and to a certain amount of legal review.  These consumer-focused services are just the tip of the iceberg, and when the Act takes effect I would expect a push by a wide range of large brands into the market for small businesses too.

There are an ever growing number of start-ups due to the decline in the number of full-time salaried positions.  Many start ups and small businesses are either unable or unwilling to pay the fees law firms would need to charge to do their legal work.  So, boot strapping start ups are invariably looking for cheaper solutions.

Currently, a start up’s options are to engage a law firm to do their legal work – which is too costly for many – or to buy contract templates (not ideal), or to cobble together documents by copying those of competitors (definitely not recommended!).  This latent legal market represents potential work that many solicitors and others would like to attract, and so we, like a lot of other firms are experimenting as to whether we can develop innovative business models to meet this unmet need for lower cost legal services.  At Azrights we have come up with a solution, a unique membership site for online business, called OBIS.

OBIS not only provides guidance to businesses hoping to carry out some of their own legal work, for example by offering instructions on how to file their own trade marks, but also allows members to submit documents for review by legal professionals who have the knowledge and experience to identify errors.

The philosophy behind OBIS is to provide a way for an online business to more effectively manage its risks, and to give those businesses access to searchable resources representing years of accumulated knowledge and experience.  This will hopefully allow them to better understand the opportunities available online, and the minefield of risks that can be the downfall of ill-prepared businesses.  Using OBIS will give businesses a much greater chance of succeeding.  OBIS will launch in December.

To find out more register for my teleseminar on November 30th here.

End of Lawyers and the Legal Services Act

In previous posts I have commented both on the ‘End of Lawyers?’- a book by Richard Susskind and also on the Legal Services Act, which are two commonly discussed items by those interested in the UK law business landscape.

In the ‘End of Lawyers? The Legal Hybrid is already here‘  my message was I already see the need for some of the changes Richard Susskind predicts, such as for lawyers to become deeply multidisciplinary.  While in the Legal Services Act 2007 post  I mentioned that the Act is expected to  mark the beginning of a sea change in the legal services market, with more innovative solutions likely to materialise.

Naturally, these issues are occupying the minds of many of us who run law firms.  One such issue I have been thinking about a lot, concerns what Richard Susskind calls the latent legal market – that is those circumstances in which non-lawyers are generally unable to benefit from the legal input they require because conventional legal service is too expensive or impractical.  To quote from Richard Susskind’s first book ‘The Future of Law’ (p.27):

“In conventional, reactive legal service, when a legal risk has been perceived and a lawyer instructed, there is an expectation that some optimum disposal of the matter will be achieved.  In contrast, legal risk management techniques are often brought to bear in respect of legal risks that would otherwise not be managed at all or would be addressed too late.  And in this context, in the latent legal market, it may be entirely tolerable (commercially and as a matter of practicality) that any solution reached may be well short of the optimum position.  The point is that the legal risk is being  managed.  Without such techniques, such risks would not have been managed at all or may not have been manageable.  Thus there can be improvement if not perfection”.

Stephen Mayson in a speech ‘Legal Services Reforms: Catalyst, Cataclysm or Catastrophe‘ alluded to a similar matter – namely that one of the ways of reducing the cost of legal services may be to deliver less technically perfect and comprehensive advice sometimes.  It is not always necessary, in other words, to have the same ‘deliverable’.   For example, many SMEs often prefer us to draft a brief legal agreement for them, rather than to serve up the traditional 15 pages or so that the precedents appear as.  As long the SME understands the downsides and upsides of this approach, then why not provide the business with something more user friendly?

I am finding that the cost of legal services is increasingly unaffordable to many start ups and small businesses.  Either the size of the latent market is growing – for example, in society generally more people  have to set up their own businesses as the number of full-time salaried positions declines – or people are simply unwilling to pay the level of fees lawyers need to charge for their services (possibly because there are cheaper, alternatives available thanks to IT).  For this reason we have introduced a new system to provide affordable access to risk management and to our expertise.   Our press release here gives more details.

Your Business and the Digital Economy Act

In view of the controversy surrounding not only its contents, but the way in which it was passed, we had written on the recent Digital Economy Act in an earlier post.  In this post I would like to focus not on the broader policy considerations that have been dominating discussion, but on some of the implications for businesses.

Those businesses likely to be hardest hit by the changes are Internet Service Providers (ISPs), who now face the challenge of implementing procedures to comply with requirements set out in the Act to combat online piracy.  It will be some time before the effects of the Act are well enough understood to offer clear and comprehensive advice on the steps ISPs must take, and a thorough treatment of these is outside the scope of this article, but it is essential that businesses providing customers with internet access take legal advice early on, or they risk facing fines of up to £250,000.

For any business operating a website, an important element of the new legislation is the power granted by the Act in relation to injunctions blocking access to infringing websites.  The Act allows the Secretary of State to set out regulations providing injunctive relief where a website “has been, is being or is likely to be used for or in connection with an activity that infringes copyright”.  Until this power is used in practice it is difficult to predict the impact it will have, but businesses who depend on an online presence would be well advised to establish auditing procedures to determine whether their websites fall within the scope of the provision.  Sites that allow visitors to freely share documents or links without careful moderation are most vulnerable.

The Act also provides for the blocking, or limiting, of an internet connection in response to its use in connection with copyright infringement.  While this has been more widely discussed so far as it relates to domestic internet use, it is of the utmost importance to business owners.  If employees use the internet while at work to access or share infringing material, the provisions may just as easily be used to block or limit that connection.  Such a sanction has the potential to cripple a modern business venture, and it is not only the activity of those in your employ which may constitute cause for concern.  If your internet connection is shared over an unsecured wireless network, then infringing use of the connection by a passerby can have similar consequences.

The best way to manage some of the risks outlined in this post is to take measures early on.  Some steps you might take include:

  • Have a clear policy for use of the internet by employees, you might also consider blocking certain high-risk websites
  • Audit your own business websites to ensure that you are not offering copyright material for download
  • Ensure that any user-generated content on your sites is carefully moderated
  • If you use one, secure your wireless network to the fullest extent that is practical given your circumstances

For further information on developments surrounding the Digital Economy Act,  you might be interested in reading the following:

The Digital Economy Act

Amidst opposition within Parliament, considerable protest from thousands, and condemnation from some of the most respected companies in the world, the Digital Economy Bill was made law last week, becoming the Digital Economy Act.

Concerns surrounding the potential impact of the new legislation are numerous and varied, but the most controversial aspect of the Act is the slew of amendments to communications and copyright law, intended to better protect the rights of artists in the digital age.  It is far too early to tell how successful the new law will be in this respect, but many commentators are hailing it as a step backwards that will hinder the competitiveness of the UK, and lead to the harassment of innocent members of the public.

Below are some of the predicted consequences:

  • Innocent members of the public will lose out
    Commentators have suggested that making the owner of an internet connection liable for the actions of people using it will have far reaching implications.  It could spell the end for wi-fi in coffee shops, and leave those less tech-savvy home owners facing expensive lawsuits.
  • Increase the cost of being connected
    Some argue that the obligations imposed upon internet service providers (ISPs) will increase costs substantially, with these inevitably being passed on to consumers.
  • Drive serious pirates underground
    Once of the greatest concerns is that, while it may severely disadvantage innocent members of the public, the new law will drive serious pirates underground, barely impacting their operations. By utilising encryption, and clever schemes to achieve anonymity, those who have the drive to ignore copyright law on a large scale will not be phased by the new Act, instead they will use technology to hide their activity more effectively.

While the music and film industry herald the new law as an acknowledgement of their rights and a need for development in the law in response to technological advancements, it is not yet clear whether the Act will have a positive impact. Many are concerned by the alleged lack of scrutiny to which the Act was subjected, and advocate reform of the business models employed by those industries rather than the introduction of further legislation.

Legal Services Act 2007

Nowadays, when high street businesses like Spec Savers offer a choice of designer frames for prescription glasses, it’s easy to forget what the opticians market looked like before it was deregulated.  In those days there was little choice, and opticians dispensed NHS prescription glasses.

The legal Big Bang augured by Clementi’s  Legal Services Act 2007 is nowadays preoccupying many law firms who are wondering what the market for legal services will look like come the end of 2011.  That is when the main changes are expected to come into effect.

These will allow law firms and other businesses to apply for a licence to operate as “alternative business structures” (ABSs).

This will mark the beginning of a significant transformation in the way legal services are provided to consumers. While traditionally the provision of legal services has been an activity reserved to qualified practitioners, the ABS will permit non lawyers to have an equity stake in law firms, and may even lead to the flotation of some law firms on the stock market.

The ABS is also designed to foster more innovative ways of meeting consumer demand for legal services. The thinking is that such deregulation will allow more efficient and cost effective services for consumers.

It is widely believed that high street law firm doing conveyancing, probate and wills, and similar work is going to be the first to suffer from these changes.  However, no law firm will be immune.

It is difficult to see how the introduction of multidisciplinary practices (MDPs), able to provide businesses with a comprehensive range of services incorporating guidance on legal issues alongside commercial solutions, is NOT going to lead to a significant change for all types of law firm.  The very increase in choice and competition in the market for consumers, is bound to have an effect on every type of law firm.
Azrights is considering its position, and how to respond.  Currently, we are exploring the possibility of combining forces with graphic designers and web developers and internet marketers in order to provide a one stop shop to start ups requiring websites, identity creation, and assistance with names – company, domain and trade mark names.  They also need to understand the many areas of law that we handle, such as copyrights, designs, patents, as well as commissioning websites.

We are also focused on delivering innovative cost effective solutions.  One way we are doing this is in introducing more multimedia into the way we deliver our legal services.  For example, during trade mark registration, we often find that despite explaining legal principles in simple plain English letters, some of our trade mark clients either do not read the letters closely enough, or for some other reason do not grasp key issues about the  law and procedure.

When time is money, the need to re-explain points to lots of different people, becomes expensive.  But on the other hand, clients who purchase a fixed price trade mark registration service might take a dim view if we were to try charging them for extra time just to have something explained to them so they can provide further instructions, such as about how many classes they will proceed with.

So, for us, it was a logical step to deliver some of our explanations by video and podcast.  This works for us because it takes far less time to produce one podcast or video than to explain something ten times over.  As people differ, it stands to reason that some will be more receptive to receiving information through the spoken word rather than through written content.  So, a fairly easy change in fact revolutionises legal services, because it reduces the need for one to one consultancy time, while delivering more value to the client.

I would love to hear what others think about the changes being brought in by the Legal Services Act and our response to it as touched on here.