Dye & Durham Ltd. (DND-T), a legal software company, has announced another round of price hikes for its services in Canada, Britain, and Australia. The increases, which affect dozens of services, come after the company previously raised prices in Spring 2022. One of the affected services, eCore, has increased its list prices by 21% excluding tax and government fees. This is the third time eCore has raised prices since D&D’s acquisition of its parent company, OnCorp. Direct Inc., in 2017.
The Ontario government-authorized service provider has seen significant increases in its list prices, including a 400% rise in the cost to register or renew a business name in Ontario. The list price to incorporate a for-profit Ontario company has also gone up by 430% over the same period. Additionally, corporate search costs have more than quadrupled. Meanwhile, D&D is doubling the price of its newly acquired Ghost Practice legal practice management software from $55 to $120 per user per month.
D&D CEO Matthew Proud stated that the price increases are a result of the company’s significant investment in its products and the need to keep up with competitors’ prices. Proud emphasized that their products deliver substantial value and that the pricing adjustments are necessary to drive revenue and earnings for shareholders. Other legal software consolidators like PC Law and Leap have also raised their prices after making acquisitions.
Previous price hikes by D&D have faced backlash from clients due to their size and scope. In response to the outcry, dozens of complaints were lodged with the Competition Bureau of Canada, leading to a class action lawsuit. However, an Ontario Superior Court judge stated in a procedural ruling that there was no real evidence that the lead plaintiffs suffered a loss of business. In 2022, concerns over reduced competition and high fees prompted the UK’s Competition and Markets Authority to force D&D to divest its purchase of legal software provider TM Group (U.K.) Ltd.
D&D’s recent price increases have not translated into a significant loss of business, according to the company. Proud highlighted that since implementing the eCore price increases, only 4% of communications to their contact centre were related to the move. The company believes that its loyal customer base values their products and expects low churn as a result of the price hikes.
D&D’s price hikes have drawn attention to the importance of access to corporate records for media organizations, who often rely on this information for news gathering. D&D’s main rival for this service is ESC Corporate Services Ltd., owned by Information Services Corp. Cyberbahn used to be another competitor, but D&D acquired it from Thomson Reuters Corp. in 2019. eCore recently informed customers that the cost to obtain corporate reports would nearly double to $64.50 each.
The announcement of the price increases coincided with a selloff in D&D stock after the company forecasted slightly lower-than-expected operating profits for the next quarter. Analyst Thanos Moschopoulos of BMO Capital Markets described the stock as “undervalued” considering D&D’s earnings profile and its ability to capitalize on recovering property deal volumes.
More detail via The Globe and Mail here… ( Image via The Globe and Mail )