Research done by KPO Consultants suggests that the LPO sector is moving towards mergers, acquisitions and consolidations.Big BPO players including Infosys, HCL, WNS, Wipro, EXL and others are seeking a toehold in the LPO space. Their financial strength enables them to use multiple entry routes to the LPO field. The margins in the BPO industry are 12-15%, while LPO offers margins as high as 40%, using fewer employees. Moreover, established India-based BPO firms are already serving foreign clients, including financial institutions, insurance companies, and corporate law departments, all of which are big users of legal services. After the foreign firms develop a level of comfort with Indian vendors, the LPO pilots are bound to start.

LPO (Legal Process Outsourcing) industry is growing exponentially and India continues to be the hottest destination for Law Firms, Corporations, and other businesses from US, UK, and other European countries. There are a lot of positives in India’s favor for these countries to offshore/outsource their legal work to India. However, India also continues to suffer from several challenges which are working against this phenomenal growth. According to a recent survey, a majority of professionals believe that LPO is a synonym of its predecessor BPO and requires execution of elementary activities which are devoid of any knowledge and skills.

It is a casual and quite an ordinary Monday morning outside the office of a leading LPO in Gurgaon, where we went to take the survey, the ambience inside is nothing beyond the usual hustle and bustle of an upcoming firm. However, within this business-as-usual ambience and the beneath the polished and serene countenances of most of the employees- there was something unusual, even in the air. If you stay a bit longer and become of a party to the usual office grapevine-, you would get enough clues as to the genesis of the “unusualness” in the air. It is a mix of anxiety and a fear of the unknown, which shoots up every time the rupee climbs higher against the US Dollar. Since the industry is still in its infancy – quite naturally, the exact impact of such currency appreciation cannot be measured from prior data or experiences and in turn, leaving most of the employees – with a tinge of apprehension.

Legal services are the next destination for the Indian outsourcing industry. With the legal services industry in the US estimated to be $166 billion, employs approximately one million trained attorneys and 500,000 support personnel such as paralegals and legal assistant, the opportunity for offshoring to India is abound. According to a study by the US based Forrester Research, the current annual value of legal outsourcing, which is worth $80 million can rise up to $4 billion and can fetch around 80,000 jobs in India by 2015. KPO Consultants estimates that Indian LPOs can become around $20 billion industry in the next decade.