General Practice, Solo & Small Firm DivisionMagazine

The Value of Your Dollar

BY JEFFREY ALLEN, EDITOR-IN-CHIEF

"You get what you pay for!" "Quality costs money." "Nothing good is ever cheap." "You can get anything you want at Alice’s restaurant" (Okay, I admit I just tossed that last one in for fun.) Seriously though, the first several of the maxims quoted play on a common theme: you cannot acquire good, useful products without paying dearly for them.

Many lawyers (and many non-lawyers) with whom I am acquainted buy into the truth of these sayings. They believe firmly that they must pay high prices to obtain good quality. They apply this concept to clothes, cars, computers and many other goods that do not start with the letter "c." Many also believe that this "universal truth" also applies to the software that they buy for their computers.

While some truth may flow through the folk "wisdom" of the sayings, paying substantial sums of money does not guarantee that you acquire good quality products. It does not even guarantee that you acquire reasonably good quality or useful products. Who among us has not spent good money for something that never worked right? Who among us has not bought expensive software that, in reality worked no better than much less expensive software?

Lawyers are prime targets for expensive boutique software. After all, we have special needs that can only be met by software carefully written by the software elves with lawyers in mind. These specially crafted boutique programs almost always sell for premium prices.

Part of the premium price results from the fact that lawyers constitute a finite (and not all that large) market. A software publisher will not likely sell anywhere near as many copies of a product written just for lawyers as it will sell copies of more generic products that do very similar things. Basic economics tell us that the larger your potential market the higher the volume of sales you can expect. The higher the volume of sales, the lower the per unit cost of producing the program—the research, development, production, and advertising costs are parceled out over more copies of the program.

If a publisher invests $1 million in development of a piece of software and sells 1 million copies, the development costs come out to $1 per copy sold. If the publisher can only sell 100,000 units, the development cost allocation is $10 per unit. If the developer can only sell 10,000 units, the cost allocation is $100 per unit. Basic production economics tell us that production costs will decrease with mass production as well. The more units our publisher makes, the less it will cost per unit to make. The bottom line is that low-volume boutique software programs will almost always cost more than generic software.

Confidence that lawyers will understand the basic production cost logic discussed above may cause software publishers to feel that they can safely charge significant sums of money for "legal" products or for "legal" versions of generic products that may have very little difference from the generic product. The "legal" version appeals to lawyers’ egos by recognizing that lawyers have special needs that can only be satisfied by "legal" versions of the software.

Before running out to purchase dedicated attorney software at a premium price or the expensive "legal" version of a software program you believe you need, I encourage you to consider what the boutique software or the legal version of the generic software offers that the generic version does not. Maybe the "extra features" will justify the price for you. Maybe not.

I currently operate my own office. It consists of me, an employed lawyer, and a secretary. In an earlier life I had partners, more employed lawyers, and more secretarial/clerical personnel in my office. I started using computers in my office in 1985. During the last 15 years, I have bought more software than I care to remember, including some of the expensive legal boutique variety. In more recent years, I have discovered that I can satisfy most of my professional software needs with software that was not specifically created for lawyers and is, therefore, generally much less expensive than the legal boutique pieces.

The primary software needs of a law firm include word processing time and billing, general and trust accounting; calendar; name/address records and, of course, telecommunications. Some lawyers may also want a spreadsheet program. Others may want presentation software in addition to the basics. These are not needs exclusive to lawyers. Many other professionals have requirements for each type of software listed above. Accordingly, you can find generic versions of each type of software that may well satisfy your needs and will, almost without exception, cost less than lawyer boutique software designed to meet the same need.

Am I telling you not to buy the more expensive lawyer-specific or legal boutique software? Perish the thought! Some of you will find the extra features justify the price differential. All I am suggesting is that you consider the differences between the legal boutique version and the generic version and evaluate the price differential before shelling out the big bucks.

Several of the articles in this issue of Technology & Practice Guide explore some of the more reasonably priced software. We think you will find the articles useful in determining what software will satisfy your requirements.

By the way, for those of you trying to minimize your exposure to carpal tunnel syndrome, our next issue will look at voice-recognition technology. n

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