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A recent study from IDC, commissioned by Relativity, reveals a growing reliance on generative artificial intelligence (GenAI) across the legal sector, with 69 per cent of 300 surveyed legal professionals forecasting increased usage over the next two years.
Conducted in multiple countries, including the United States, United Kingdom, and Australia, the study gathered insights from attorneys, paralegals, legal operations, and IT professionals, underscoring GenAI’s potential to streamline legal practices worldwide.
The report, titled, Generative AI in Legal 2024, highlights how GenAI is being adopted across various legal tasks, from document review and contract analysis to legal research. In fact, document review is projected to become the leading use case for GenAI, with 65 per cent of respondents planning to implement AI for this purpose within the next year and 93 per cent within five years.
Legal professionals express a high degree of comfort using GenAI for document review, seeing it as a reliable tool for automating one of the most labour-intensive tasks in legal work.
David Horrigan, discovery counsel and legal education director at Relativity, commented on the findings, stating, “With a long tradition in eDiscovery, we were also pleased to see that eDiscovery was where the respondents trusted AI the most, with 89 per cent indicating they were very comfortable or somewhat comfortable using AI for document review.”
He added, “It’s also worth noting that—although the study indicates legal research and contract analysis are currently the leading legal uses for generative AI—document review is expected to be the leading use within a year. We think it’s due to the long history of technology-assisted review (TAR) in eDiscovery, and we’ve addressed some of those early concerns from a decade ago, as well as concerns respondents expressed in the study, with the Relativity aiR suite of generative AI offerings.”
“Although US-based technology companies have been leaders in the development of generative AI, the legal industry spans the globe, and, in compiling this research study, we sought to capture how legal professionals around the world are working with and responding to the rise of generative AI,” said Ryan O’Leary, research director for privacy and legal technology at IDC and the lead analyst for the study.
“As the study indicates a range of comfort in using generative AI, it does uncover that document review will soon be the leading legal task performed with generative AI—confirming the transformative power of generative AI to the modern legal industry.”
Market dynamics and revenue implications for eDiscovery
While the efficiencies GenAI introduces into document review are expected to streamline workflows, the impact on revenue models for eDiscovery providers may be complex.
Industry insights from ComplexDiscovery OÜ suggest that, as AI-driven efficiencies take hold, providers could see a reduction in review-related revenue on a per-matter basis, with anticipated reductions ranging from 10 per cent to 30 per cent over the next three to five years. However, these revenue shifts will likely vary by case type, data volume, and the specific AI models deployed.
Providers are advised to avoid generalising the impact, as individual case outcomes may differ based on these variables. Importantly, AI-enabled efficiencies also position providers to handle greater case volumes more quickly, potentially offsetting revenue reductions through increased throughput.
Efficiency and cost reduction drive broader GenAI adoption
Beyond document review, legal professionals report that their primary motivations for adopting GenAI are automating routine tasks and reducing costs.
Approximately 58 per cent of respondents cited automation as a key reason for using GenAI, with another 48 per cent emphasising cost efficiency.
These benefits illustrate how GenAI is enhancing operational efficiency and allowing legal teams to focus on complex, high-stakes work.
Demand for AI governance and ethical practices
A high percentage of respondents indicate that robust AI governance and ethical guidelines are top priorities for integrating GenAI successfully. Nearly 78 per cent of survey participants emphasised the need for clear governance standards from GenAI providers, along with transparent ethical principles.
This focus on governance underscores legal teams’ commitment to maintaining confidentiality and data security, hallmarks of the legal profession.
David Horrigan at Relativity noted that these priorities closely align with Relativity’s own AI strategy. “We’re encouraged that the legal professionals in the Generative AI in Legal 2024 study confirmed some of the most important parts of the AI strategy we’ve implemented at Relativity,” he said.
“The two most important things the respondents wanted to see in generative AI providers were AI governance capabilities (78 per cent) and clear AI principles (68 per cent), and one of the most important things we did on our AI journey was to publish Relativity’s AI Principles.”
The report further notes that while legal departments influence AI purchases, no single group leads in the decision-making for AI acquisition, highlighting a need for coordinated innovation and governance to ensure responsible AI use across organizations.
Concerns over data privacy and bias
With increased GenAI adoption, legal teams also highlight concerns over data privacy and potential biases in AI outputs.
Data security remains a top priority, as legal professionals seek to protect sensitive and confidential information.
Concerns over data bias and quality similarly rank high, as errors in these areas could directly impact legal decision-making.
Smaller firms eye AI as a competitive tool
GenAI adoption patterns differ by organization size, with larger firms—particularly those with over 1,000 employees—experiencing close to a 50 per cent increase in usage.
Smaller firms, however, view GenAI as a way to level the playing field, particularly in automating tasks that don’t require specialised expertise.
Billing models also influence GenAI adoption, with firms using billable hours showing a greater inclination to adopt GenAI than those on task-based billing models. This trend suggests that billable-hour firms are motivated to reduce non-billable work, increasing productivity on revenue-generating tasks.
Training and skill development key to success
A key theme from the study is the need for enhanced AI proficiency within legal teams. About 73 per cent of respondents report that their organisations are investing in skills development related to GenAI, with initiatives that include on-the-job training, third-party consulting, and employee education programmes.
These efforts are seen as essential to helping legal professionals maximize GenAI’s potential while effectively managing associated risks.
Given the rapid pace of AI advancements, organisations are prioritising upskilling their teams to safely incorporate AI into their workflows. This investment will be crucial as GenAI’s role in legal operations continues to expand.
Future outlook and ethical AI integration
The study suggests that GenAI is on track to become an indispensable tool in legal workflows, particularly in tasks like document review and contract analysis.
As GenAI adoption accelerates, legal professionals will need to carefully balance efficiency with ethical considerations such as data protection and bias mitigation to preserve client trust and meet regulatory standards.
While challenges remain, including data security and ethical governance, GenAI has the potential to reshape legal operations, helping organisations improve service delivery, reduce costs, and refocus resources on strategic work.
Read the complete article at Generative AI Adoption in Legal Sector Expected to Surge, New Study Finds (complexdiscovery,com).
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