It’s that time of year when predictions for the year ahead are made, often unwisely. Here’s one from me, about which I’m pretty confident. 2025 will be a pivotal year in the pricing of legal services as generative AI begins to be meaningfully deployed across the profession. What will at first see dozens of 6-minute units of time saved in the carrying out of this or that task, will eventually see hundreds, then thousands of units of billable time no longer being passed on to clients. So, what comes next?
The AI Challenge: Hundreds of Units, Thousands of Tasks
Generative AI is already capable of replacing the mundane, repetitive tasks that make up so much of legal work. What was previously billed as hours of work for tasks like legal research, document review, reports on title or contract drafting can now be completed in moments by AI. This presents a clear challenge to law firms that have built their practices around time-based billing.
As AI continues to take over the grunt work, lawyers’ roles will evolve. Rather than spending time on routine tasks, they will be able to focus on what truly adds value—offering strategic advice, managing complex disputes, and using their expertise to solve problems creatively. The question is no longer how many hours to charge, but what value is being delivered to the client.
Moving Beyond Billable Hours
This shift creates a challenge for law firms that have long depended on the simplicity of the billable hour model. The question clients will begin asking is simple: Why should we pay for hours when AI can do that in minutes?
The answer lies in reframing how we talk about value. The true worth of legal services has never been in the time spent on a task; it’s always been about the outcomes. AI might handle a document review, but it can’t strategize or advise on the next best steps in a complex negotiation. Lawyers will need to demonstrate their value in a way that’s not tied to hours worked but to results delivered.
And let’s not forget that while the use of AI reduces the cost of production, the value in the service being delivered is likely increased, as law firms are able to process the work more efficiently.
The Opportunity: Value-Based Pricing and the Skills You Need
Here’s the opportunity: AI allows law firms to rethink pricing entirely. Instead of billing by the hour, firms can move towards value-based pricing, where the focus is on outcomes, not inputs. In this model, clients pay for the value lawyers bring to the table—the successful resolution of a legal matter, the protection of a business interest, the strategic advice that leads to growth, the peace of mind.
Law firms need their lawyers to really ‘get’ value pricing—not just the principles behind it, but how to communicate the value they offer to clients. This is a game-changer. Firms that invest in value pricing skills are going to be better positioned to serve clients more effectively and to capture the true value of their services.
By integrating AI into their business model, law firms can deliver faster, more accurate, and more cost-effective results, without sacrificing the high-value insights that clients expect. AI handles the routine; lawyers provide the strategic edge. The result? A better outcome for the client and a more sustainable business model for the law firm.
Conclusion: Focus on Results, Not Time
The days of relying on the billable hour are all but numbered. As generative AI takes on the routine legal work, law firms will shift to a value-based pricing model that emphasizes the results they deliver rather than the hours they spend. The opportunity lies in having lawyers that think and act in terms of value, not just time. Firms that embrace this shift will be well-positioned to thrive in a world where the best outcomes matter more than ever before.
So, dear reader, are you going to diary this forward a year to see whether I was right, or do something about it?