Are the walls of Jericho about to come down?
♫ So let your trumpets blow
Round the walls of Jericho
Let your mighty voices sound
Until the walls come tumbling down…♫
– Music, Lyrics and recorded by: John Fullbright
What do Uber, the taxi-replacement service, and the practice of law have in common? This was recently posted by a friend in Facebook:
Transportation in the new digital economy; Vancouver is Uber-free, but I tried it in Sacramento. Download the app and fill in basic information (e.g. credit card) in advance. When ready, the app confirms pickup location, takes your destination address, estimates the fare and wait time for pickup, and (if you approve) calls a driver. Best feature: when you arrive, just step out of the vehicle and go; payment is automatically charged to your card. No fiddling with charge cards, signatures, etc. A very positive experience – I will definitely use the service again.
Uber is a disruptive technology/service that is changing the face of ground transportation in cities where it has taken hold. Does Uber hold any lessons for the practice of law? To start, let’s look at the commonalities of taxis and the practice of law. Each:
- Has a monopoly that excludes competitors.
- Calculates the fare at the end of the ride.
- Is highly regulated.
- Extols the virtues of their regulations as protecting the public’s interest.
- Claims that their exclusivity is necessary to ensure the proper operation of the market for their services.
What are the differences between taxis/the practice of law and Uber?
- Uber app estimates your fare in advance.
- Uber app shows the route you will be taking.
- Uber collects feedback from riders and uses this to ensure quality control.
Uber claims that they offer predictability, lower prices for a similar product, greater convenience, reliability and quality of service by focusing on the client experience.
What evidence is there in support of Uber’s arguments? Well, the Competition Bureau says ride-sharing services are good for consumers, calling them innovative and likely to create lower prices and better service (http://bit.ly/1Nj0Xcg).
What happens when Uber comes into a city?
- The condition of taxis suddenly improve.
- Uber itself begins to face lower-cost competitors.
Certainly there are many detractors and negative aspects of the Uber model. But Uber is an example of the emerging platform business model, in which competitors can enter a marketplace for virtually zero marginal cost against entrenched competitors.
Can this happen to lawyers? Clients don’t necessarily want a lawyer; they want a solution to their legal problem. Does it matter to them if a lawyer or a non-lawyer provides the service?
I have often said that the hardest law to repeal is the law of economics. In this case, Uber and similar services have the law of economics on their side. Consider that if we do nothing, as lawyers we may let our mighty voices sound until the walls come tumbling down….
The views expressed herein are strictly those of David Bilinsky and do not reflect the opinions of the Law Society of British Columbia, CBABC, or their respective members.
David J. Bilinsky is the Practice Management Advisor for the Law Society of British Columbia.