I’ve been through lots of market research in the last year. Just to connect a few dots, we know two of the largest companies in our industry, Veritext and US Legal, are merely investments in the portfolios of larger holding companies, Leonard Green and Abry Partners. Those larger companies are invested in the private equity game, a game of buying, holding, and flipping (BHF) companies for profit in the same way someone might BHF houses, stocks, or bonds.
Approximately one out of every four court reporting companies are unprofitable. Combine that with the knowledge that in order to BHF companies, holding companies often load up the investment company with debt in what’s called a leveraged buyout. Veritext and US Legal may be servicing huge debts that the smaller shops don’t have. Their seemingly endless cash flow and price warfare over the last decade may have been at a loss. They wouldn’t be the first. VIQ Solutions has a bunch of transcription subsidiaries and operates with losses in the millions.
Anecdotally, multiple sources have reported lawyers are unhappy with both Veritext and US Legal, and it appears both corporations are increasing their rates faster than smaller court reporting companies, something they wouldn’t be doing if they were not feeling some financial strain.
This is probably the decade and the next golden age for court reporting. The behemoths are likely weighed down by debt and a management structure that cannot be supported without ridiculous prices. Smaller, more efficient firms will be able to rise up and take back all of the business that was gobbled up. I don’t need an anecdote for that one. The latest from MAGNA, Veritext, and the Big Bully Brigade was “waaah we’re bigger and can provide things little people can’t. Just believe us! Because bigness!” A lie so unconvincing that I think a six year old could’ve figured it out as long as that six year old was not Victoria Hudgins.
Stenographers need a pat on the back. The increased competition over the last few months alone has the larger corporations showing signs of strain. US Legal, still terrified to mention court reporting’s biggest commercial blog, has appointed Sara Giammanco as the Director of Reporter Engagement.
I wonder why they needed one of those. Could it be because Peter Giammanco supports digital court reporting? Does anyone really believe they’ll stop acting passive aggressively toward court reporters until court reporters put the company down a la some increased competition and bankruptcy? It’s very simple. People say what they’re paid to say. We’ve seen it with Stenograph. We’ll see it here too.
Maybe I can help the big boxes. Here’s some free consulting for them: Cudahy lied. The stenographer shortage can be solved by recruitment. The science and data available today, namely the Testifying While Black 2019 and Racial Disparities in Automatic Speech Recognition 2020 studies, show that alternatives to stenography aren’t as accurate. They aren’t cheaper. The market preference is stenographers. So basically you morons threw out the fundamentals of business by ignoring consumer preference, service quality, and cost of revenue, a blunder from which I doubt you’ll be able to recover, given the only thing you’ve ever been good at is wrongfully convincing stenographers they’re overpaid. People are prone to confirmation bias, and the business types have allowed their belief in technology™️ to rob them of all common sense. It would’ve been a lot smarter to turn stenographers into salespeople and train them to sell upcharges like expedites, roughs, and realtime instead of beating us down on price and constantly putting us in a state of feeling unworthy. You know, maybe I’ll start a company here in New York City and do just that.
Knowing that the big boxes are probably servicing big debts and seeing how they’re now scrambling to appease the profession that months ago they were claiming was dying no matter what™️, I think it is incumbent on every reporter to realize a single truth: If you fight, you will win.