Relx Value Slumps Amid AI Concerns

Almost £14 billion was wiped off the market value of London’s largest media and data companies, as fears emerged that artificial intelligence could undermine core segments of their businesses. Relx, a leading information and analytics company, lost just over £6 billion from its stock market value following the launch of a new AI product by Anthropic, which can automate tasks in the legal industry.

The legal sector represents a key market for Relx, generating approximately £900 million in revenue during the first half of the year, equating to nearly one fifth of the company’s total sales. The decline in value reflects broader anxieties regarding AI’s potential impact across various industries.

The London Stock Exchange Group experienced a notable 9 per cent drop in its share price, which translated to a nearly £4 billion reduction in market value. The introduction of Anthropic’s Claude Cowork chatbot aims to streamline tasks such as contract reviewing, compliance workloads, and templated responses, providing tools aimed at optimising efficiency.

Anthropic has rapidly emerged as a competitor to OpenAI, with backing from Amazon. The San Francisco-based start-up is reportedly in discussions with banks regarding an initial public offering anticipated later this year. At the end of the previous year, LSEG formed a partnership with Anthropic, licensing some of its financial markets data for use with Claude.

Other traditional data and information companies such as Experian and Sage also faced significant declines, resulting in an aggregate loss of £2.5 billion. The sell-off extended to American companies, with Gartner and Intuit experiencing drops of 22 per cent and 11 per cent, respectively.

As concerns mount regarding AI potentially diminishing demand for traditional products, many companies in the sector are striving to adapt by integrating machine learning into their offerings. Analysts have suggested that advertising companies and traditional media firms are particularly vulnerable amidst these technological advancements.

Despite these challenges, some analysts argue that companies can mitigate negative perceptions associated with being labelled as “AI losers” by launching and promoting revenue-generating AI products. This evolving landscape calls for a strategic focus on innovation and adaptation within the media and data sectors.