A Toronto law firm has become the latest in a string of companies to begin selling their internal technology to third parties. Having developed AI technology for proofreading documents, Fasken decided it was too good to keep to themselves and have begun selling it to their clients and competitors.
The earliest example of this trend is Amazon, who found themselves building large server farms and developing a cloud computing platform at scale in the early 2000s that has since become a market-leader in its own right -- Amazon Web Services. AWS is now a wildly profitable business: Revenues grew 47% in 2018 to hit $25.7bn.
In financial markets, Blackrock's trade execution and risk management platform Aladdin is another leading example. Aladdin has become the platform of choice for many of the asset manager's institutional clients and Blackrock's technology services unit generated $800m of revenue in 2018 - up 20% on the previous year.
In the insurance industry, Ping An Group - the largest insurer globally by market cap - has established a subsidiary called Ping An Technology to service the companies within the group. Ping An Technology has now begun licensing their proprietary technology to third parties and offers cloud computing alongside computer vision and artificial intelligence services. The subsidiary employs 6,500 people and expects to generate 50% of revenue from sales to customers outside of the wider group.
In general, Western insurance companies have yet to pursue these opportunities, although not all of them have technology worth paying for.
Fasken Martineau DuMoulin LLP, a Toronto-based law firm known as Fasken that has offices in Canada, the U.K., South Africa and China, in May launched a spinoff venture to market and sell its artificial-intelligence platform, among other tech tools. The platform was developed in house over the past two years to automate a range of law office tasks, such as proofreading legal documents and searching for precedent cases. The goal is to “automate as many tasks as possible for lawyers,” said Mark Bowman, a counsel in the firm’s corporate, commercial, privacy and cybersecurity practices who leads the new initiative, Meese AI. Mr. Bowman said his previous work as a software engineer helped him come up with the business, which plans to sell its products to Fasken clients, largely other law firms.