Thomas Alsop
Research expert covering the global hardware industry
Legal tech - statistics & facts
Legal service providers across the world have had to consider ways of reducing their costs while creating new methods that are different from the competition – presenting additional challenges. Legal tech refers to the use of technology software and solutions to support the legal industry and provide legal services. In 2022, the global legal tech market was valued at 28 billion U.S. dollars, with the market set to increase further in the coming years. An array of technologies are being deployed to provide legal services at a cheaper, more efficient, and improved standard. Artificial intelligence, natural language processing, and robotic process automation are just some of the tools used to facilitate this, both in business-to-business and business-to-consumer settings.
The post-pandemic recovery across the legal services industry
The coronavirus pandemic brought about new challenges in the way legal services were provided to customers. Due to restrictions on movement, collaboration tools and other digital solutions were adopted. Even in more traditional legal service settings such as courtrooms, hearings were switched to take place virtually through the aid of live streaming platforms. However, as the world returned to a new normal, a new, higher priority was given to the digitization of processes and data management. As a result, legal tech has the opportunity in the long term to make a positive impact on the activity of legal professionals. This includes improvements to the quality of work provided to clients, as well as a reduction in the time taken to complete tasks, freeing up capacity.The Big Four are recognized as leaders in legal tech
Important contributors toward the growth of legal tech have been Alternative legal service providers (ALSPs). An ALSP can be defined as any business providing legal services without being a law firm. Among the largest and fastest-growing ALSPs that have been able to obtain legal services licenses are Deloitte, EY, KPMG, and PwC – otherwise known as the Big Four. The types of service offered by ALSPs are even more complex, fueled in part by the pandemic and now, further economic uncertainty. The growth of alternative providers, including legal tech startups, will help to better facilitate the relationship between consumers and legal services. Supported by increased levels of adoption, the impacts of legal tech are set to be felt more extensively across the world.Tech-related investment is essential during a recession
In 2023, businesses must navigate a recessionary environment in addition to other economic, social, and political pressures. Lessons from the pandemic would confirm that companies that invest in legal tech in the lead-up to a period of economic difficulty tend to have higher revenue growth during the time of recovery following a downturn. As such, the growth of the legal tech sector provides an opportunity to change how legal services are delivered. The next-generation workforce immersed in a digital world, coupled with the growing demands for reduced costs and time savings, has resulted in firms facing increased pressure to adopt or develop legal tech solutions.
