AI news ·
Cost concerns grow as law firms adopt AI
Law firms face steep upfront AI costs as clients demand faster service. Corporate departments expect outside counsel to use automation without billing for saved hours.
Law firms are accelerating their adoption of artificial intelligence tools, but rising cost concerns are giving partners and clients pause. Reed Smith LLP partner Christopher M. Sheaffer says clients repeatedly ask how his firm uses AI across practice groups and which specific programs are in use.
Sheaffer said clients frequently ask how his firm uses AI tools across different practice groups and which programs are in place. The questions reflect a growing demand for transparency and efficiency in legal services, pushing firms to invest in technology even when budgets are tight.
The price of innovation
Firms are pouring money into AI-powered legal research, document review, and contract analysis platforms. These tools can speed up routine tasks and reduce long-term expenses, but the upfront investment is steep. Midsize firms, in particular, face difficult trade-offs between staying competitive and managing cash flow.
Client pressure mounts
Corporate legal departments now expect outside counsel to use advanced technology. They want assurances that firms are not billing for hours saved by automation. This pressure forces firms to adopt AI or risk losing clients, even when the return on investment remains unclear.
Why this matters for legal professionals
For lawyers and legal operations staff, the shift toward AI means new skills are no longer optional. Grasping AI for Legal is becoming essential. Professionals who can evaluate, implement, and manage AI tools will help their firms control costs and win client trust.