Rising Legal Tech Giants Will Dominate—Not Democratize—Practice

The consolidation of legal technology players has begun, including Clio’s billion-dollar acquisition of vLex late last year. Power players like this are pitching end-to-end super-platforms for lawyers, with AI-enabled research, case management, document generation, workflows, and more.

It’s a potent proposition. But the industry should be cautious about the consolidation of legal tech players, especially as they hand over workflows, know-how, and business models as training for these companies.

The data legal tech companies accrue will shape the future of legal practice. One day, the platforms may start competing with their customers, offering legal services without human lawyers.

These platforms pitch that lawyers can serve more clients, be more effective, quickly get up to speed on emerging law, and stop wasting time with rote tasks like sending invoices, handling payments, or managing intake. But the more a platform offers, the more influence it stands to have over how a lawyer delivers services.

Take healthcare, where Epic dominates the market for electronic health records management systems. This fact alone gives Epic enormous passive influence over how health systems use their data. If it’s too hard to extract data from or add data to the records system, promising research might die on the vine.

Beyond that, Epic has leveraged their power (and their customers’ data) to become more involved in the care relationship, from algorithmic risk assessment tools for doctors to “agents” to help patients navigate care. Just by owning the data platform, Epic can carve ever more value out of the doctor-patient relationship.

This is the playbook for market dominance in the internet age, from ads to services to physical goods: Build a platform to intermediate a relationship or service, and capture as much value from that service as possible. And in the age of AI, lawyers are about to speed-run a lesson in platform power.

It’s not about how capable AI might be or who is allowed to offer legal services. It isn’t hard to imagine a future where a one-time super-platform gradually offers direct legal services itself.

It might start by helping to match clients and lawyers or helping lawyers access a “vast untapped client market.” For ordinary people with legal questions, a platform could offer access to a document library, or a chatbot where individuals could get limited-scope help or create simple legal documents.

For an extra fee, they might get a simple review from a lawyer on the platform. For in-house departments, a platform might offer an automated “co-pilot” to help save money on outside counsel, with just-in-time fractional support from a human as needed.

In the right regulatory environment, a company could launch a law firm, powered by the most advanced AI models in the industry. After all, what better way to build and fine-tune a model than with the help of thousands of expert users?

The problem isn’t that the people running these companies have ill intent. In the rush to invest in AI, legal tech vendors are poised to accumulate ever more leverage, and build an ever-deeper moat. Yesterday, legal vendors created vast, proprietary research databases. Today, vendors are absorbing decades of knowledge and specialized workflows as structured data to train custom AI models.

As we’ve seen with other technology industries, left to their own devices, legal tech platforms will merge until there are just a few dominant platforms.

Over time, a firm’s ability to launch a new service might depend on whether their software vendor supports it, not whether it’s possible. A firm might one day find itself competing with its one-time vendor, powered by the knowledge extracted from that firm and many others.

Rather than democratize the law, AI could help fuel yet another wave of consolidation, where the benefits accrue to those with the most capital, the most data, or the most market share. It’s not hard to imagine a world where high-quality legal services are just as expensive and inaccessible as it is today, but where dominant legal tech platforms are absorbing most of the value.

Of course, firms can protect themselves in individual vendor relationships. They can strike agreements to limit the ability of legal tech firms to retain and use customer data for their own ends. Emerging technical standards, such as confidential computing, can help ensure those agreements are honored.

And there is still time to build better portability standards into vendor contracts, to ensure that firms can move their data and workflows from one technical platform to another.

Beyond individual relationships, there remains an opportunity to jointly invest in common, open infrastructure for information about the law, rather than scrambling to build new proprietary systems.

Ultimately, this is a collective problem and not a new one: The technology platform economy and lax antitrust policy has helped concentrate market power rather than distribute it. Fail to solve it, and the future of legal services will be just another monopoly.

This article does not necessarily reflect the opinion of Bloomberg Industry Group, Inc., the publisher of Bloomberg Law, Bloomberg Tax, and Bloomberg Government, or its owners.

Author Information

Keith Porcaro is a senior lecturing fellow at Duke University School of Law.

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