In his keynote address at the Summit, Michael Wilens, president of West Group, made observations about how the Internet revolution changed information technology and what could be learned from the economic downturn in the information industry last year. In a panel discussion that followed, entitled "Rethinking the Information Company, Gaining from Adversity," Lisa Mitnick, senior vice president, Legal and Tax Solutions, from LexisNexis, also noted that the rise and fall of many Web companies has created opportunities for established companies to acquire innovative businesses, technology, and talent that she believes will revitalize the traditional information industry. As a follow-up, both Wilens and Mitnick were interviewed about how West Group and LexisNexis, both leaders in legal and business information, are responding to these challenges and opportunities.
 

Web Migration
Wilens used several visual analogies in his keynote address to explain why information companies were hurt financially when users migrated from other media to the Web. He compared the early adopters of technology to the leading edge of a slinky and the bulk of users to the trailing edge, which holds off until the last minute and then jumps all at once. A double bubble economic model occurs, he explained, when risk-averse customers, the trailing edge of the slinky, buy the same product twice in different media and create a revenue bump. But when the majority of users finally accepts a new technology, as they did last year, the slinky effect occurs, the second bubble bursts, and revenue declines. Wilens and Mitnick were both asked about the effect that migration of users to the Web had on their companies and on future business strategies.
 

Rapid Change
The Internet also eliminated the advantage of proprietary platforms and energized product development, according to Wilens, which created both challenges and opportunities for the industry. In his keynote, he stated that product cycles have decreased from 3 years to as little as weeks because of new Web technology. The upside of these shorter time frames is the ability to quickly respond to competitive demands, but it can also lead to an unstable product with more changes than customers may want.

Wilens pointed out the difficulty in predicting whether advances in content, technology, or distribution will drive the future direction of the industry. He compared it to the three-body problem in physics which holds that when three or more objects interact with each other, their trajectory is impossible to calculate. What is critical, Wilens explained, is to be able to respond rapidly to change when it occurs. As a follow-up, Wilens and Mitnick were asked how the advances in information technology brought about by the Internet revolution have affected their products and how they are preparing for new developments that might occur in content, technology, or distribution.
 

Merging Old and New
In her talk, Mitnick pointed out that the traditional information companies that came through last year financially intact now stand to benefit from the post-dot-com shakeout. The current buyers' market offers opportunities to reinvigorate products and services,she noted,through investments in acquisitions, new talent, and infrastructure. More over, the integration of innovative Web services with the depth and breadth of traditional services should produce a new generation of products and services that will transcend what has gone before. Both Wilens and Mitnick were asked to describe how their companies have benefited or expect to benefit from the Web revolution in this respect.
 

Interview with Michael Wilens

How was West affected by the migration of users to the Web?

West's print business remained flat and relatively unaffected by the Web last year because lawyers still love the leather books. The CD-ROM business was a different story and had a much higher attrition rate, as subscribers dropped subscriptions and began to rely solely on the Web for electronic access. The online growth last year was 11 percent and currently represents 60 percent of the business. The positive effect of this change is that actual usage has increased 40 percent and support costs are lower than for CD-ROMS. The challenge for the company, but good for the customer, is that the Web is much more competitive than CD-ROM, since the competition is just a click away.

What effect will these changes in usage have on your business strategy going forward?

West will introduce West Pack to drive business from both the print and online sides of its business. West Pack combines access to online databases with print subsets at a discounted rate. The cannibalistic effect has been accounted for in this year's plan and a recent pilot demonstrated exceptional market acceptance.

How have the advances in information technology brought about by the Web revolution affected West's products and how are you utilizing the faster product development cycles to get closer to your customers?

It is easier and faster to change a Web site than a CD-ROM, and, with over 60 percent of users now on the Web, West can upgrade its service and add features and new content more readily. However, continuous upgrades annoy some customers who prefer a more stable interface. West has responded by introducing My Westlaw, which allows users to personalize their interface by selecting just the new features they will use. For example, a medical malpractice lawyer might need to change the interface in order to see JPGs of a new collection of medical pictures, but a lawyer in a different practice area could ignore the feature. Change is controlled within tabs pre-organized by practice areas. Enhancements can be purchased as optional tabs, which are easy to turn on. West has also leveraged advances in built-in, interactive help and natural language to make the service easier for first-time users.

How is West prepared to respond to the three-body problem, i.e., developments in content, technology, or distribution, which may have a major impact on the market and direction of the industry?

Last year, West invested in infrastructure and acquisitions, and 2002 will be a year of consolidation and deployment. Westlaw is moving to a new platform, a collection of large Sun servers with very large memory footprints (internally named Novus), and will migrate over 100 terabytes of data from its mainframes to Novus in the next 2-3 years. Among other benefits, this will result in fast XML content searching, as well as the ability to more easily develop extensively customized products.

West has also positioned itself to be technology neutral in the area of productivity tools. West originally developed WestWorks, an integrated practice and information management system, as an ASP and DSL solution. However, when it became apparent that ASP and DSL telecommunications were problematic for some firms, West purchased ProLaw, a leading provider of case management software, and merged it with West Works. ProLaw is a client server package that runs on a law firm's own server, and it has widgets that plug into many different portal solutions. Thus, it doesn't require firms to change their infrastructure or invest in new technology in order to deploy it. Over time, ProLaw will provide its software on either a client-server or ASP basis.

West is also ready for a wireless revolution. Users started with print, moved to proprietary online service, then to CD-ROMS, and then to the Web. The Web leveled the playing field and eliminated desktop footprint. Going forward, people are becoming "always on," with wireless devices, beepers, instant messengers, cell phones, and GPS receivers in their cars. West has built Westlaw Wireless, a wireless product accessible through a variety of devices (e.g., Palm Pilot), and makes it free to subscribers. In addition to allowing users to access Westlaw content, directories, KeyCite, and e-mail from remote locations, the wireless service turned out to have an unexpected outcome. As an interesting unexpected bonus, the simplified interface for wireless access has been redeployed to provide special tailored access for blind researchers who need simple screens for their reader software.

How has West benefited or does it expect to benefit from the dot-com shakeout? Can you give examples of new alliances or acquisitions West has made that will blend Web innovation with Westlaw's deep content?

During the height of the dot-com boom, technologists were hard to hire. This year, West has been able to recruit and hire top-notch people from former dot-com companies with a mixture of traditional and Web experience. At the start of the downturn, West also acquired FindLaw, a Web legal site with huge traffic, but minimal revenue. This is a case of cultures working together. It gives West new content, an expanded presence on the Web, and it provides FindLaw with the resources to develop and expand its services. FindLaw also expands the West Legal Directory service substantially, making it competitive with the Martindale Hubbard Directory on LexisNexis.

What would you most like to see West accomplish in 2002?

2002 will be a three-legged stool: 1) West will focus on its premium content, add more value-added, unreported cases, and strive to remain the highest-quality provider; 2) West also plans to lead the market in innovation with services such as knowledge management, ProLaw, and FindLaw; and 3) West will focus on customer satisfaction by hiring a senior customer experience czar and incorporating the best of e-commerce, online customer service solutions.
 

Interview with Lisa Mitnick

How has LexisNexis been affected by the .migration of users to the Web?

LexisNexis user migration has gone from its proprietary software and services to an array of Web-based information services introduced in the mid-'90s. The migration of LexisNexis customers to the Web has opened the doorway to reach new users across the enterprise, to deliver greater functionality and better product offerings. In addition, the Web platform is more readily accessible, and the training process is more streamlined and cost-effective.

What effect will these changes in usage have on your business strategy going forward now that the migration is largely completed on LexisNexis?

We will continue to grow our business on the Web, leveraging its solid foundation to couple comprehensive information with the best Web innovations and solutions.

How have the advances in information technology brought about by the Web revolution affected LexisNexis's products, and how are you utilizing the faster product development cycles to get closer to your customers?

The Web is the best thing that ever happened to the traditional information industry. It has been a wake-up call to re-tool our approach and enhance our competitive stance. The next generation of LexisNexis products will mirror customer activity cycles and leverage Web technologies to produce functional, task-based solutions along with enterprise-wide services. They also will capitalize on our global technology infrastructure to allow products and services to be customized for individual geographic areas and needs, while using a common platform and consistent underlying navigation. This is increasingly important to companies doing business on a global basis.

How is LexisNexis prepared to respond to the three-body problem, i.e., developments in content, technology, or distribution, which may have a major impact on the market and direction of the industry?

LexisNexis is making investments in and leveraging all three. We are integrating high-value content with technology to deliver task-based applications that enhance productivity and improve decision-making. LexisNexis has focused on acquiring proprietary, value-added content, such as Shepard's and Matthew Bender, and signed exclusive licensing agreements with CCH, Tax Analysts, and Congressional Quarterly. At the same time, we have invested significantly in XML technology to enhance the value of this content. LexisNexis has created a gateway that converts content to XML on the fly and enables us to deliver the content in the format customers want. LexisNexis SmartIndexing is also applied across all news content. In addition, we frequently work closely with our customers to deliver customized taxonomies and indexing that reside on their intranets in the form of a customized user interface. LexisNexis has a full suite of e-solutions which facilitate publishing of content inside and outside an organization, as well as corporate portal solutions. And we currently have a strategic alliance with Plumtree Software by which we deliver a legal portal.

How has LexisNexis benefited or does it expect to benefit from the dot-com shakeout? Can you give examples of new alliances or acquisitions LexisNexis has made that will blend Web innovation with LexisNexis's deep content?

LexisNexis came out of 2001 with solid results, and it is well-positioned to take advantage of opportunities that might arise. Throughout 2000 and 2001, LexisNexis made a number of acquisitions, including Pressaccess, Riskwise International, and Courtlink, all three of which are examples of acquisitions which will be combined with other LexisNexis content to create task-based e-solutions. Pressaccess is a dot-com business providing public-relations solutions for PR executives to manage their calendars, find, and talk to journalists. Riskwise is a comprehensive set of risk management solutions and provides due diligence, consulting services, real-time identity verification, and other value-added services. Courtlink provides Web-based services for electronically filing legal documents and accessing and monitoring court records.

LexisNexis has also been actively pursuing technology alliances. A good example is our relationship with iPhrase. iPhrase's natural-language search and navigation technology is being integrated with LexisNexis's Advertising Red Books and Directory of Corporate Affiliations. The integrated applications will allow users to type in natural-language queries and get back context-sensitive questions, targeted results, and hierarchical representations such as corporate trees from the data. Reed Elsevier's (LexisNexis's parent company) Venture Group made an investment in iPhrase and is investing in other start-ups with high potential and close synergies with LexisNexis's business strategy.

What would you most like to see LexisNexis accomplish in 2002?

We will continue to increase customer satisfaction and preference, partnering with our clients to deliver world-class, easy-to-use information solutions. To that end, we will continue to invest in content, technology, and distribution that enable us to solidify and expand our customer base globally.