Is the Billable Hour Doomed? AI and Self-Service Reshape Legal Work

As AI advances, traditional billable-hour models face disruption in the legal industry. Rhys Hodkinson, Chief Revenue Officer at Definely, highlights how generative AI and legal technology are driving in-house teams and law firms to rethink their approach to billing and service delivery. In-house legal teams increasingly demand efficiency, cost-containment, and self-service options for low-complexity, high-volume tasks.

Forward-thinking law firms are adopting subscription-based models, leveraging AI-powered tools to automate routine tasks while reserving expert input for high-value work. This shift not only improves margins but also aligns with client expectations for value-driven legal services. Firms that fail to embrace these changes risk losing relevance as in-house teams continue to adopt technology to perform tasks traditionally outsourced to law firms.

Hodkinson emphasizes that law firms can retain revenue and client trust by creating proprietary AI solutions tailored to client needs, such as drafting or reviewing contracts. Efficiency and innovation will define the future of legal billing and service delivery.

5 Key Takeaways:

1. AI Disruption: Generative AI is challenging the traditional billable hour, automating low-value tasks.
2. In-House Demand: Legal teams prefer cost-effective, self-service options for routine tasks.
3. New Models: Subscription-based services are gaining traction as alternatives to hourly billing.
4. Client Expectations: Efficiency and value are increasingly driving legal service delivery.
5. Adapt or Fade: Law firms must adopt technology or risk being left behind by innovative competitors.

Original interview by Legal Dive with Rhys Hodkinson, Chief Revenue Officer at Definely, “Why smart firms are rethinking the billable hour using new AI tools.”