In July 2015 LexisNexis acquired MLex, a newsletter service specializing in international legal analysis of regulatory risk. In recent years MLex has cracked the US market as a “must read” for antitrust lawyers. MLex editors employ an investigative approach combined with in-depth forensic examination of issues by reporters, lawyers and industry experts located in 15 bureaus around the world. In the last eight months they have launched two new products emerging from vortexes of regulatory uncertainty: Brexit and the election of Donald Trump. These two newsletters will be examined in part two of this post.
The market for specialty news.
I recently interviewed MLex founder and CEO, Robert McLeod. MLex has ridden a wave of demand for deep specialized news. McLeod discussed MLex’s rise in the context of recent dislocations in the news industry. The Pew Center has documented the decline of the traditional newspapers.
McLeod witnessed the transformation from inside the traditional news industry where he has deep roots as a professional journalist. He started as writer with Bloomberg in 1993 when Bloomberg had only 17 reporters in Europe. McLeod focused on antitrust and merger control in Paris, covered energy and investment banking in London and was promoted to bureau chief in Belgium. McLeod traces his idea for MLex back to 2004. As Internet browsers began eroding the market share of traditional newspapers, the owners of news outlets responded by cutting the most highly compensated reporters – the ones who covered the most complex regulatory and business issues. Newspapers began seeking business and regulatory content from news agencies like Bloomberg and Reuters. There was one catch. Newspaper editors wanted “copy” but they wanted “watered down” versions for general news readers. McLeod recognized that there was still a market for very sophisticated business coverage or as he likes to say …“smart copy.”
Since broadband has leveled the playing field. Startups like MLex had a unique opportunity to complete with big news organizations. McLeod left Bloomberg in 2005 to launch MLex.
MLex – “11 Years to Overnight Success”
McLeod filed his first MLex story on July 7, 2005. He recalls celebrating when the first reader clicked on the story. He watched the traffic grow steadily. He found four US law firms who agreed to subscribe for the first year. MLex was not an easy sell. Forty five firms said they were not interested… they already had a source for all the antitrust news they needed. McLeod was confident that he could deliver a product that provided deeper analysis and more compelling content than his competitors.
Over the past decade MLex has branched out into coverage of: financial services, anti-bribery, compliance, data privacy, globalization and convergence of regulatory risk. McLeod offered an outline which highlights the acceleration of global regulation.
McLeod’s Outline of Regulatory Acceleration:
- · It took 120 Years for antitrust regulation to spread around the world from US.
- · It took 40 years for anti bribery to spread around the world from the US.
- · It took only 12 years for data privacy and security regulation to go global.
McLeod expects the next big regulatory issue to go global in less than 10 years. All of these regulations expose companies to serious risks running the gamut from huge fines to jail time for executives. Many of the regulatory regimes are converging and companies which are exposed on one issue may discover risk exposure on other issues. This convergence will increase the risk of litigation. According to McLeod “Companies which operate multiple jurisdictions have to update their compliance materials every three months. The job of the global GC is to keep the CEO out of prison.”
Today MLex has 85 reporters in 15 bureaus located in key political and financial centers around the globe including Washington DC, New York, Sao Paulo, Beijing, Jakarta and Geneva. Subscribers represent more than 800 law firms and corporations around the globe.
New Issues in the Pipeline.
McLeod anticipates that tax and intellectual property will be next areas to experience a surge in global regulation.
McLeod also sees opportunity arising from being part of LexisNexis. LexisNexis has a deeper bench of technologists and programmers who can help them add enhancements to the product. McLeod would like to see new visualization features such as regulatory "heatmaps." They plan to offer lawyers the ability develop custom newsletters on discrete issues that will automatically update. One use case would be shareable pages on specific issues related to a deal.
While library budgets remain tight, specialty news sources for practice groups remain one of the few areas where spending is increasing. Specialty news addresses every lawyers need to feel smarter than their client, while also responding to every GC's demand that outside counsel follow the business issues facing their industry. Specialty newsletters like MLex are positioned in a market sweet spot where they can simultaneously reduce information anxiety and enhance opportunity.
Up Next: Part Two-- MLex Tackles Brexit and The Trump White House