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| Shore's
Research, Commentary and Consulting Receives Prestigious
Recognition.
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Fine Print: LexisNexis Integration and
Workflow Tools Move Beyond Vertical Search |
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13 February 2006 |
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Serving market verticals with new content services is a
hot trend these days if recent content industry conferences
are any indication. Yet content services such as LexisNexis
have been out there for decades doing just that for many
business sectors. While everyone seems to be piling on the
vertical search bandwagon LexisNexis is moving aggressively
to get beyond mere search services and far more integrated
into the real workflow of legal professionals. It's a
tricky move that may not lead to huge profits in the short
run, but with competition closing in from the Web and from
enterprise technology providers it's the path that major
aggregators must get right if they are to enjoy healthy
profits in years to come. |
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When people go agog as of late
over the so-called vertical search movement I suspect that
people at
LexisNexis manage a somewhat wry smile or two in
private. While LexisNexis cuts a fairly wide swath through the
corporate space in general its focus on legal services placed
it as one of the early innovators in providing content
aggregation and search services specially tailored to the needs
of a specific professional sector. But in today's sophisticated
legal services marketplace time doesn't stand still for
even a USD 2.5 billion business information services provider
such as LexisNexis. Search is still an important fixture in
their range of services, but legal firms are focusing more on
resources that can lead to key advantages in the battle for
client billables.
A spate of recent announcements from LexisNexis highlight the
key areas in which many aggregators need to focus their value
propositions for verticals. The new
LexisNexis Total Litigator service provides a workbench of
information tools and services designed to service litigators
throughout the lifecycle of a matter, including drafting,
service of process and filing, legal research, gathering
intelligence and discovery.
New modules in its updated Total Search service can locate
experts on a particular type of matter inside a firm and can
mine
content from both LexisNexis databases and a firm's own content
resources to discover deal-making documents from past agreements that can
accelerate the formation of documents for new deals. A
new relationship with enterprise search engine provider FAST
enables clients using this increasingly popular search
interface to organize their internal content using LexisNexis
taxonomies. And if all that weren't enough there's also a
new search toolbar that allows LexisNexis subscribers to
have quick search access to the LexisNexis resources from their
favorite Web browser.
While individually these may be viewed as incremental
improvements to a popular service, in combination they reflect
both the opportunities and challenges faced by today's major
providers of business content. In the Total Litigator and Total
Search services LexisNexis serves up powerful workflow tools
that focus on solving business problems more than simply
retrieving the right documents at the right time. But at the
same time the FAST taxonomy tools and the search toolbar point
out that many users are looking elsewhere for content inside
and outside their firms and using popular general interfaces to
find those sources and solutions. So as aggregators continue to
provide more sophistication and integration in their services
oftentimes it is still fundamentally a battle to answer the
question, "What have you done for me lately?"
The increasing sophistication of aggregator services such as
those being introduced by LexisNexis is sure to appeal to
participants in specific verticals who can benefit from both
their content collections and the deep knowledge that they have
of how people use content in their field. But it's not clear
that the benefits that these sophisticated services provide are
going to justify the costs their clients bear for the
underlying subscription content collections much longer. Here
are a few thoughts about what business content aggregators must
do to begin to move beyond singe-digit growth:
- Don't assume that workflow tools will solve
everything. Tools such as Total Litigator are powerful
ways to express the value of underlying content collections
and services in a new light. But the buzz around workflow
solutions does not always add up to long-term profit
potential. Looking at financial information aggregators such
as Bloomberg, Reuters and Thomson demonstrates that decades
of software development designed to solve business problems
more efficiently with tools and vendor content may lead to
incremental gains in market share over time but margins are
unlikely to improve. With a wealth of I.T. solutions pushing
in on aggregator value propositions, oftentimes workflow
solutions only allow vendors to keep abreast of the
push towards content collection commoditization.
- Decide what business you're in. LexisNexis seems
to have become more aggressive in positioning itself as a
legal solutions provider more than a database provider. This
is in part because of its already high level of
specialization in legal services, but its expertise that's
only beginning to be realized in a fairly limited scope. If
there's unique value in a database then it's generally worth
it to maintain it as a resource. But most aggregators
equipped with largely non-unique sources in their collections
will be better off moving away from the all-purpose
subscription database model and carving out larger portions
of corporate solutions budgets with solutions that move up
the value chain away from their core content collections.
Look at solutions from the business on in, not the collection
on out.
- Think about your sales model as much as your product
model. Many of the large business content
aggregators seem to be centered on sales at a very high level
in the enterprise or on pay-per-view access to individual
articles. Yet Shore's research indicates that many purchases
by individuals in corporate settings are undertaken not for
the benefit of one person but for their departments or work
units. When you're dealing with an apparently saturated
marketplace that middle tier of users may seem like an
expensive path to profits. But with less high-value content
being purchased centrally servicing those middle-tier buyers
cost-effectively for more than one-off purchases is a key
component for building future profits. If you sell something
as a universal commodity, then you're exposed to the
long-term disadvantages of content that's not valued highly
enough for specific reasons by specific audiences.
The long-term picture for content services will continue to
feature major aggregators being squeezed by software services
providers and individual publishers increasingly adept at
reaching their audiences through major search engines. By
focusing intensely on the needs of specific verticals companies
like LexisNexis will be better equipped than most aggregators
to find a healthy position in this changing marketplace for
content. But it's a position that will require constant tuning
and a careful shift away from services that heretofore had been
viewed as core assets. Yes, focusing on verticals is a great
idea, but make sure you bring along your reading glasses to
focus on the fine print of what those verticals really need.
-
John Blossom
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