E-Commerce and the Practice of Law
Judge Arthur M. Monty Ahalt ( Ret.)
This Article was first published in the Prince George’s County, Maryland Journal/Newsletter
“When you come to a fork in the road, take it.” Yogi Berra
Lawyers are finally grasping the information age through the medium of e-mail. They are finding the speed, efficiency and productivity of communication in the electronic world. The other day I completed a non-binding arbitration at 3:00 p.m. The parties wanted a written decision. They had one in their e-mail inbox at 5:00 p.m. No mail delay. No paper jams. Just Friday of last week I rescheduled a mediation involving three parties with one phone call and two e-mails (a process that used to take two days with telephone tag).
When you think about e-commerce you probably think first about selling things online. The first example you would come up with, if asked, would be LL Bean or Amazon.com. While e-commerce is certainly all about selling on the Internet it is much more. E-commerce is about redefining the nature of relationships in the commercial world. The commercial world includes the legal profession. After all, lawyers sell legal services to clients who purchase legal services. So e-commerce for the legal profession is about redefining the relationship between lawyer and client.
Before we examine how that relationship will be changed by e-commerce, let’s take a look at some of the numbers in the e-commerce world. The Internet had 56.2 million host computers as of June 1999. That is a 69 percent increase over the 36.7 million computers in 1998. In 1993, 90,000 Americans had access to the Internet. In 1999 there were 92 million users. The number of households online has grown from 5.8 million in 1994 to the present 39 million. Some experts say that there will be 60 million households by 2003.It took 38 years for the telephone to penetrate 30 percent of U.S households, 17 years for television and 13 years for personal computers. The Internet has accomplished in five years what it took the telephone 70 years, the radio 40 years and television 15 years to achieve: connecting more than 50 million people.
E-commerce is penetrating the legal profession through e-mail. Every day another lawyer starts using e-mail either because a client requires it or a colleague starts demonstrating its productivity. Bottom line: e-mail is a very cost effective and reliable way to communicate in written form. E-mail is beginning to redefine the relationship between lawyer and client.
The numbers are exploding. In 1998 there were 263 million e-mail boxes in the world. They produced 618 billion messages. In the same year the U.S. Postal Service delivered 101 billion pieces of mail. Some surveys estimate that those Internet users send and receive more than 20 messages a day. That totals 2.1 billion messages a day for all users.
This phenomenal growth is causing many firms to grapple with the critical questions. How can we compete in such a market? How can we be successful? The answer to the questions is certainly not by maintaining the status quo. Firms that take that approach will be run over by others who understand the new environment and take advantage of all that it has to offer. Sam Guiberson, a “prime time” trial lawyer from Houston, Texas, puts it this way: “If you haven’t learned to speak the language of technology in the 20th century, you will have no voice in the 21st.” Sam says that lawyering will become more about relationships, the more it involves technology.
Most of the press of recent has been going to the glitzy web sites and the fancy portals, which pretend to be one-stop shopping. But rendering a professional service such as legal advice has a personal confidential element, which is interfered with by the openness of web sites. On the other hand e-mail, even though Internet based, allows for the development of a relationship. Many think of e-mail as the ability to have continuous on-line contact. E-mail is the glue, which is holding e-commerce together. It has the promise of being the beginning-to-end solution for electronic commerce.
Let’s take a look at what e-mail promises. Of course e-mail’s main attribute is the delivery of a text message. E-mail containing text only, however, is disappearing fast. First, e-mail attachment of Word or WordPerfect files started to appear. Now even elementary systems deliver multimedia content to homes and offices. HTML – formatted news in an e-mail – is becoming common. E-mail products are being produced to carry photos and sound. The refrain “you’ve got mail” has turned to “you’ve got pictures.”
Not just one format exists for e-mail attachments. There is not just one attachment for sound, but dozens. There is not just one format for images, but also several choices for black and white faxes alone.
Yet e-mail is more that just a delivery vehicle which competes with the United States Postal Service, UPS or Federal Express. It has the promise of being the beginning-to-end electronic solution. It will be used to advertise goods and services, buy them, ship them and pay for them. E-mail will be a series of digital transactions between lawyer and client and lawyer and the court, which will speed up the delivery of legal services with great time saving efficiencies. New technologies will enable the good persuader to become a super persuader. E-mail promises not just to replace the postman, or special delivery truck, but it will replace telephone calls, cashiers and even checks.
E-commerce makes location insignificant. So if a law firm in Hawaii can do a better, cheaper job then they will compete for business in Maryland. E-commerce also changes distribution channels and creates new distribution channels. Peter Drucker, the management expert for the information age, points out, “New distribution channels change who customers are. They change not only how customers buy but also what they buy. They change consumer behavior, savings, patterns, industry structure – in short, the entire economy.”
by Judge Arthur M. Monty Ahalt ( Ret.) – December 1999
