Alex Heshmaty considers the impact of the latest developments in the legal AI landscape.
Since ChatGPT was released towards the tail end of 2022, many of those working in professional services industries have been monitoring the huge strides made in generative artificial intelligence (AI) with a mixture of excitement, bemusement and some degree of existential dread.
Although the initial impact of AI was felt by copywriters, translators and graphic designers – many of whom lost their livelihoods as a result – 2026 is shaping up to be the turn of the legal sector to grapple with the full force of the growing waves of AI.
Big AI and Big Law
One of the most iconic images so far of Big AI reaching out to Big Law was the recent marketing campaign by Legora featuring Hollywood star Jude Law. Rival Harvey opted to make its namesake from TV drama Suits its brand ambassador. No doubt the marketing budgets wielded to secure A-list celebrities must be eye watering, commensurate with the company valuations of $5.6 billion and $11 billion, respectively.
But these costly marketing efforts are unlikely to make a dent in a potential rival valued at almost $1 trillion: Anthropic. The frontier large language model (LLM) created waves across the legal sector when it unveiled a legal plugin for its Claude product, immediately hitting the stock price of incumbent legal publishing behemoths such as LexisNexis and Westlaw, which have their own legal AI offerings. (‘Frontier LLMs’ denote the most advanced AI platforms available – typically the latest models of ‘foundational LLMs’.) Microsoft, which owns a 27% stake in OpenAI, quickly followed suit by launching a legal AI agent in Word.
Meanwhile, several companies – spanning law, legal tech and legal publishing – are attempting to develop their own foundational AI platforms. (‘Foundational LLMs’, sometimes called ‘core LLMs’, are the proprietary AI platforms trained on vast amounts of raw data – as opposed to ‘wrappers’, which provide an AI interface based on a third-party foundational LLM.) US firm Kirkland & Ellis has set aside $500 million to create its own AI tool, which aims to hoover up the “collective intelligence” of all its partners. Meanwhile both Harvey and Thomson Reuters are attempting to create their own LLMs from the ground up.
Big AI: threats and opportunities for the legal sector
The fast-moving developments in the legal AI space are making it challenging for law firms to know what parts of AI to embrace while navigating the risks. Brian Inkster, founder and CEO of law firm Inksters, says that despite the obvious disruption posed by legal AI, it does not yet pose an “existential threat” to the legal profession. However, it’s “a minefield at the moment and an ever-changing one” for law firms, and he urges them to consider what problem (if any) they are trying to solve with AI, rather than simply rushing to adopt it for fear of missing out.
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