A market research report has published data suggesting that the global legal AI market will grow at 35.9% per year/CAGR in terms of revenue between 2019 and 2026 – and that doesn’t seem unreasonable at all.
Data from New York-based Zion Market Research said that: ‘The rising funding for AI and its growing adoption in legal firms are major factors driving the global market growth in the upcoming years.’
Usually when market research companies suggest high figures for future market growth – of any product or service from demand for bananas to semiconductors – it’s usually best to take the figures with a pinch of salt.
But, in this case, that figure doesn’t seem too wild at all. If companies such as Kira Systems can today be at 120 clients, with many of those clients added in the last couple of years and those businesses rapidly expanding their use of the technology and hence increasing total spend; and for us now to have between 25 and 30 legal AI doc review/analysis companies (depending which ones you count) all operating in the market from Brazil to US to Canada to UK to Germany to Singapore to Japan – then this does seem possible.
You’d only need modest growth across the board in terms of client acquisition and higher use levels inside each client to drive this kind of market expansion.
We are also starting off from a relatively low base. If we look at market uptake, moving from a handful of firms to dozens of firms in the space of a couple of years, then growing at 36% per year for the next seven years is not impossible at all as a combined market. Moreover, as more legal AI companies come to market they will also add to the total – as long as they don’t cannibalise existing demand.
This is good news in general, but will also please investors, which have been pouring money into legal AI tech companies, as well as those businesses that have bought up legal AI startups, from iManage to Donnelley Financial to Elevate.
Some of the other numbers Artificial Lawyer saw in the sample of data seem a little less solid. But, who knows, maybe they are right too. We will see soon enough.
You can try and get the full report here and then you’ll be able to make your own mind up.