Legal teams are no strangers to pressure. From tighter budgets to faster turnaround times, the demands on in-house counsel have only intensified in recent years. But now, something more structural is changing.
And it's happening fast.
Across industries, corporate legal departments are experimenting with tools that promise to automate swathes of routine work: contract review, compliance checks, due diligence, and even internal legal queries. At first glance, it’s a welcome efficiency boost. But there’s a knock-on effect that private practice lawyers should be paying attention to.
If a machine can triage NDAs or flag risk clauses in vendor contracts, why pay an external firm to do it? That’s the calculus more GCs are making — and not without reason.
According to the 2024 LexisNexis Legal AI Report, 65% of UK in-house legal teams are already using or planning to use generative AI tools, and 44% said they expect a “moderate to significant” reduction in spend on external counsel as a result.
The message is clear: in-house teams are keeping more work in-house.
For private practice lawyers, especially those in mid-sized firms, this trend introduces a challenge. If clients are using tech to take care of the low-margin, high-volume work internally, the work that’s left is often higher stakes — but it’s also under more scrutiny.
Clients expect more strategic insight, faster delivery, and pricing models that reflect the reduced volume.
The 2024 Thomson Reuters State of the Legal Market report found that corporate clients are placing “greater weight than ever” on value over pedigree, and 60% of general counsel said they are reassessing their external legal panels based on efficiency and cost transparency.
This puts pressure on the traditional billable hour model and on firms that struggle to match the responsiveness or price point that AI-augmented in-house teams can offer.
Ironically, the shift could benefit lawyers who operate independently. Consultant lawyers — especially those using AI tools themselves — can offer clients the best of both worlds: senior expertise without the overhead of a traditional firm.
They’re faster to adapt to new technology. They don’t need to justify bloated rates. And they’re able to slot into in-house workflows more easily than large teams with rigid structures.
In other words, as AI eats the middle of the market, the extremes — high-volume internal work and flexible external expertise — will thrive.
If you’re a private practice lawyer watching your client instructions slowly dwindle, this isn’t just about technology — it’s about a shift in how legal services are being valued.
But the lawyers who embrace it? They’ll find themselves at the centre of a new kind of legal service — tech-enabled, client-aligned, and fully in control of their practice.