The New Competition

“The average [computer] programmer today can do the work of five or six programmers in thelate 90s,” says Jason Anderman. “And one lawyer today can do the work of ... one lawyer in the late 90s.” The difference, says the founder of American website whichdraft.com, which offers numerous downloadable commercial contracts for free, lies in their respective approaches to innovation.

It’s a sentiment shared by Chilwin Cheng, co-founder of the new Canadian website Firedwithoutcause.com, which provides information, documentation, and damages calculations at low prices to people who believe they’ve been wrongfully dismissed.

By automating and streamlining necessary but straightforward and/or repetitive tasks, sites like Whichdraft and Firedwithoutcause.com can offer legal services more quickly and cheaply than the average law firm associate, or even the average legal secretary. And by lowering or outright eliminating the bar on legal fees, they can tap into a vast latent market: the average consumer or small business owner who would never consult a lawyer because lawyers are too expensive.

No one, says Cheng, especially not someone recently laid off, would hire a lawyer at several hundred dollars an hour to get an extra week’s severance pay, which averages about $687. But for between $40 and $60, Fired Without Cause can provide not only free tutorials on the law governing dismissals, but also a severance package calculator that assesses a client’s offer against a database of thousands of similar cases, as well as customized counteroffer letter templates that Canadians can use to negotiate with an employer.

“If the average Canadian can save a month’s rent, or three grocery trips, that’s a huge deal,” says Cheng. “We provide the information to people at a cost that is proportional to their problem.”

But is 50 bucks a pop — or, in the case of Whichdraft, free — enough to pay the bills? Anderman freely admits that his site does not generate revenue, yet. Whichdraft aims to make money through a mix of premium services to paying subscribers, custom services for corporate clients, and the value of its database, which contains multitudes of legal contract in their various permutations. Firedwithoutcause.com is counting on volume and on the wider profit margins generated by automation.

“Data is free,” says Cheng. “Wisdom is free — just look at all the legal blogs out there. But information — where someone has to roll up their sleeves and gather all the data and interpret it — that, people will pay for.”

In the future, Cheng hopes to offer a lawyer referral service for clients who realize that it might be worth hiring a lawyer. The ability to prescreen, he says, is a huge asset for lawyers who often spend non-recoverable time sourcing quality clients. “We’ve got a database of several hundred people who may well be very good candidates for lawyers’ advice. They know they want to move forward. That’s gold.”

The jury’s out on whether sites like Whichdraft and Firedwithoutcause.com spell the end of the business of law as we know it, but they certainly are harbingers of change. To cope, it may be time for lawyers to think a little less like lawyers and, just maybe, a little more like software designers.