If
you’ve
been
paying
attention
to
legal
tech
announcements
lately,
you’ve
probably
noticed
a
pattern:
the
legal
tech
industry
is
experiencing
an
unprecedented
wave
of
consolidation.
LexisNexis
and
Harvey
recently
announced
a
strategic
alliance
that
will
let
Harvey
and
LexisNexis
users
have
the
benefits
of
both
platforms.
The
practice
management
behemoth
Clio
last
month
announced
the
acquisition
of
the
legal
research
platform
vLex.
And
then
just
last
week,
the
premier
document
management
system
provider
NetDocuments
announced
partnerships
with
Harvey
and
Legora.
NetDocuments
also
announced
a
greater
integration
with
Microsoft.
Customer
Desires
and
Expectations
Why
all
these
combinations
now?
I
think
they
are
all
driven
by
AI.
Indeed,
when
you
look
at
what
these
vendors
are
doing
and
saying,
it’s
all
about
expanding
AI
capabilities
for
customers.
So
why
all
this
activity?
Quite
simply,
it’s
because
customers
want
this
expanded
capability.
People
experience
the
ease
and
time
savings
of
AI
one
place
and
want
it
every
place.
But
here’s
the
other
thing
customers
want:
simplicity.
The
fewer
tools
and
platforms
they
have
to
use
to
get
things
done,
the
better.
They
want
their
AI
tools
to
work
seamlessly
as
if
they
were
all
from
the
same
provider.
And
finally,
particularly
in
the
legal
environment,
they
need
assurance
that
their
work
can
be
done
securely.
But
Why
Combine?
But
that
doesn’t
necessarily
explain
what
we
are
seeing
in
the
recent
combinations
and
acquisitions.
Those
events
are
driven
by
two
reasons.
Legal
tech
vendors
have
to
combine:
they
can’t
do
it
alone
and
only
other
legal
tech
vendors
can
offer
the
requisite
security.
Build
v.
Buy?
First,
providing
AI
everywhere
all
the
time
ain’t
easy.
It’s
particularly
difficult
if
your
business
model
is
based
on
supplying
good
but
limited
products
which
almost
every
tech
product
maker
does.
NetDocuments
is
more
or
less
limited
to
providing
an
excellent
document
management
system.
vLex
is
limited
to
legal
research.
Even
Clio,
large
as
it
is,
is
primarily
a
practice
management
system
provider.
So
it’s
a
classic
build
versus
buy
decision.
It
would
be
tough
for
a
document
management
system
provider
like
NetDocuments
to
become
an
AI-based
legal
research
provider.
Or
for
Clio
to
develop
an
AI
system
similar
to
what
vLex
has.
Harvey
started
as
a
legal
drafting
tool.
While
it
has
expanded
its
set
of
tools,
it
would
be
tough
for
it
to
develop
its
own
legal
research
tool
to
compete
with
LexisNexis.
Or
a
document
management
system
to
compete
with
NetDocuments.
vLex
is
a
great
legal
research
tool
but
for
it
to
develop
a
practice
management
system
to
compete
with
Clio
would
be
well-nigh
impossible.
And
even
if
these
companies
could
develop
their
own
systems,
by
the
time
they
got
there,
their
competitors
would
be
way
ahead.
But
the
other
option
to
meet
AI
demand
is
to
acquire
or
combine
with
those
who
can
provide
what
you
can’t
or
can’t
provide
very
well.
Hence,
we
see
these
combinations:
Harvey’s
strategic
alliance
with
LexisNexis
to
integrate
the
LexisNexis
legal
research
and
writing
capabilities.
Clio’s
acquisition
of
vLex
which
gives
both
platforms
something
the
other
one
lacks.
And
now
the
NetDocuments
alliance
to
bring
Harvey’s
drafting
capabilities
and
tools
to
NetDocuments
customers.
It’s
all
about
expanded
AI
capabilities
for
customers.
What
About
Security?
The
second
reason
for
the
recent
activity
is
the
need
to
better
assure
lawyers
and
legal
professionals
that
their
work
will
be
secure
so
as
to
meet
ethical
requirements.
By
necessity,
legal
tech
companies
have
to
combine
with
other
legal
tech
companies
who
understand
the
need
for
this
kind
of
security
and
can
provide
it.
An
integration
with
a
publicly
facing
company
like
ChatGPT
might
provide
a
tool
that
could
theoretically
do
what
customers
want
but
it
could
not
meet
the
security
requirements.
As
Dan
Hauck,
Chief
Product
Officer
of
NetDocuments
puts
it
about
ndConnect,
the
product
that
will
integrate
with
Harvey
and
Legora,
“ndConnect
extends
our
unique
document
and
AI
capabilities
to
third
party
AI
vendor,
while
keeping
the
full
protection,
findability,
and
productivity
of
their
foundation
platform.”
The
NetDocuments
press
release
reiterates
this
idea,
“ndConnect
is
NetDocuments
new
interoperability
program
designed
to
securely
and
seamlessly
integrate
third
party
AI
solutions
into
their
NetDocuments
environment”.
By
the
way,
note
the
concept
implicit
in
what
NetDocuments
is
saying.
It’s
not
just
talking
about
partnerships
with
Harvey
and
Legora
–
NetDocuments
is
talking
about
combinations
with
other
third
party
vendors.
In
other
words,
we
will
likely
see
more
of
this
in
future.
What
Does
the
Future
Hold?
Certainly,
economies
of
scale
may
be
part
of
these
moves.
But
AI
works
most
satisfactorily
when
it
can
be
used
everywhere
for
everything.
And
used
securely.
That’s
what’s
fundamentally
driving
this
wave
of
combinations
and
why
we
will
see
more
in
the
future.
Law
firms
should
be
aware
of
these
combinations
and
scrutinize
the
integrations
that
AI
providers
offer
to
make
sure
they
work
simply
and
securely.
Stephen
Embry
is
a
lawyer,
speaker,
blogger,
and
writer.
He
publishes TechLaw
Crossroads,
a
blog
devoted
to
the
examination
of
the
tension
between
technology,
the
law,
and
the
practice
of
law.