Wow. What a year 2019 has been! It says something about a market when after what was an already frantic period of change that things are still humming with significant activity. Here are some of the stories that caught Artificial Lawyer’s eye over the last 12 months. Clearly, not everything could be included, but hopefully this covers some of the key developments.
Legal Tech Regulation
For the first time we saw real pushback on the ability of legal tech to deliver change in the market. First in France, with a ban on the publication of the analysis of judges’ decisions – a story that Artificial Lawyer broke and which then went global, and then later in the year we saw a regional lawyers’ organisation in Germany seek to ban DIY contract platforms on the basis that consumers needed to have a lawyer involved. And, we also saw California enter the fray, initially with the aim of freeing things up – but perhaps accidentally risking adding new regulation where it might not be needed.
The Big Four
When analysing the most popular stories on Artificial Lawyer, ones about the Big Four always receive a high level of engagement. This is for the simple reason that a lot of law firms see the Big Four as ‘a threat’, rather than a force for good, and which are shaking up the status quo and being an essential catalyst for positive market change.
The chances of the Big Four taking out the Magic Circle are very slim, what is more likely is that they will offer clients a wider set of choices, especially around legal process work and improving legal processes in themselves. However you see them, the market certainly cares about what they do. And that’s a good thing.
Below are a few of the stories that hit the headlines – in particular EY’s rapid expansion into the field of legal process work.
(Note: the link above also includes a write up of the MDR LAB cohort 2019 – and incubators have certainly been another major theme of the year.)
2019 is definitely the year that smart contracts broke through the theoretical discussion barrier and ended up in the real world. Use of smart contract technology within complex agreements remains at an early stage, but importantly law firms are now actually making and selling to clients their own smart contracts. Clause has been central to these developments.
We have also seen some very interesting work around smart contracts and new approaches to financial services – with OpenLaw in New York doing some great work there. And we have also seen the UK embrace smart contracts especially, in part because of a desire to be the legal centre for disputes that arise from their use, and in relation to crypto assets.
Consolidation and Casualties Along The Legal Tech Road
2019 saw two things in terms of the companies that make up the legal tech market: increasing consolidation and platformisation (i.e. not merging, but making an explicit effort to link closely to other point solutions to provide a more compelling total offering); and the beginning of fears that the legal tech bubble, that has seen so much investment (see: Around $1bn Invested in 2018 Into Legal Tech/NewLaw Companies – Investec ), may be about to burst.
The reality is that consolidation only claimed a handful of companies, while the majority motor on independently. And as for a bubble bursting…have a read of the piece below.
Legal AI Doc Review + Analysis Market Just Grows and Grows
The widening use of legal AI tools for different aspects of doc review and analysis has been a mainstay of 2019. While well-known companies such as Kira Systems, Seal Software, LawGeex, ThoughtRiver and Luminance keep on steadily expanding, there has also been a stream of smaller and sometimes new companies making ripples in the legal AI pond. Here’s a few of the stories about the new(-er) kids on the block.
Plus – we have seen some interesting new moves from the more established players, such as:
ALSPs (…and Law Companies) Find A Receptive Market
If disaggregation is the name of the game, then ALSPs (and…Law Companies) are custom made for this new era of legal industrialisation.
But, of course, if it’s all going to be about cheaper human labour then the story will not end well. Luckily, it’s not, and these legal businesses with a focus on process are now steadily embracing legal AI doc review tech to help them perform in ways that humans alone could never achieve.
From Artificial Lawyer’s perspective, the Seal Software and UnitedLex deal was really a watershed moment that marked the wider acceptance of legal AI tech + humans, over just cheaper human labour. And that is a significant victory in terms of everything this site is working toward.
As you can see, that’s quite a lot of important stuff happening that has helped to shape the market in just 12 months.
And this is all part of a very fluid situation, with one event triggering another. I.e. X happens, which drives Y to happen, which amplifies the importance of X, which then makes Z happen as a reaction, and so on, domino-ing all the way across the legal sector – or at least the larger commercial firm end of it.
The legal market is more dynamic now than at any other time since….well, it’s hard to remember when it was like this. Globalisation was exciting, but all those mergers across borders did little to change the way that legal work was produced. Now, this is starting – and starting is the key word – to change.
There is also so much else that could be added here. For example, the steady growth of legal ops; the continued rise of no code platforms and workflow automation systems; the use of contract data for more than the legal team’s benefit (see Juro Launches NLP-Driven Contract Reader To Boost Inhouse Efficiency); plus the first legal tech hackathon ever in Japan – which Artificial Lawyer helped to judge; and of course the launch of the now landmark legal innovation event of the year – Legal Innovators, which will be back again in 2020 and also take place abroad.
But, hopefully the above covers many of the key themes, and certainly represents many of the stories that Artificial Lawyer readily looks back on when asked about important market change.