For decades, the billable hour has served as the dominant commercial foundation of legal practice. It has influenced how law firms measure productivity, how lawyers progress through their careers, how partners are compensated and ultimately, how clients pay for legal services. Although alternative fee arrangements have steadily gained acceptance over the years, time has remained the profession’s principal unit of value.
Artificial intelligence has begun to challenge that assumption.
The future of the billable hour was never debated as a standalone topic at any of these events. Yet it emerged repeatedly, often indirectly, across discussions on law firm strategy, legal technology, client expectations, AI governance, legal design, professional training and arbitration.
Rather than asking whether AI will replace lawyers, many discussions focused on a more immediate commercial question: if technology reduces the time required to complete legal work, how should clients evaluate and pay for the expertise that remains uniquely human?
The conversations did not produce direct answers. Instead, they illustrated that the legal profession is entering a period in which efficiency, judgment, transparency and commercial value are becoming increasingly intertwined.
General counsels are reassessing what they pay for
One of the clearest indications of this changing landscape emerged during LegalTechTalk 2026’s discussion on: “What Metrics are GCs Using to Evaluate Outside Counsel?”
Moderated by Mori Kabiri, Founder of Legal Operations KPIs, the panel featuring Olga Dmytriyeva, Head of Legal & Compliance — Americas at IMI and Aminata Ba, Head of Legal, Europe at Menzies Aviation examined how in-house legal teams are evaluating law firms at a time when artificial intelligence is rapidly changing legal workflows.
The discussion was not framed as a debate about abandoning hourly billing. Instead, it explored how AI is reshaping client expectations regarding efficiency, communication and value.
Olga Dmytriyeva observed that artificial intelligence is enabling lawyers to complete many tasks significantly faster than before. Research, drafting and document review, which traditionally demanded substantial lawyer time, can now often be completed more efficiently with AI-assisted tools. While acknowledging these technological advances, she noted that clients are becoming increasingly interested in understanding how those efficiencies are reflected in the services they receive.
Her remarks suggested that transparency is emerging as an important component of the client-law firm relationship. Clients are no longer interested only in the quality of legal advice, they also want greater visibility into how legal work is being performed, the technologies being used and the extent to which those technologies improve efficiency.
Instead of questioning the use of AI itself, corporate legal departments are beginning to ask whether improved efficiency should influence the way legal services are priced and delivered. That expectation, however, is closely linked to communication.
Illustrating the point through personal experience, Olga recounted a long-standing relationship with an external law firm whose legal work she had consistently valued. The relationship changed when she unexpectedly received an invoice that was significantly higher than previous bills without any prior discussion or warning. Her concern was not solely the amount charged. As an in-house lawyer, unusually high invoices required internal approvals and explanations before senior management. Without advance communication from the firm, she found herself defending costs she had neither anticipated nor been consulted about. Attempts to discuss the matter after the invoice had been issued proved unsuccessful, eventually leading her organisation to discontinue the relationship.
The experience highlighted an issue extending beyond billing practices. Trust between clients and law firms is shaped not only by legal expertise but also by transparency in commercial dealings. As AI enables greater efficiencies, unexpected invoices or inadequate communication may become increasingly difficult to justify. The discussion also examined how clients distinguish between paying for expertise and paying for inefficiency.
Drawing upon her experience managing legal matters across multiple jurisdictions, Aminata Ba explained that clients engage law firms because they expect them to function as coordinated professional organisations. Where transactions require input from specialists in different practice areas, clients naturally anticipate internal collaboration.
What clients should not be expected to fund, she argued, are inefficiencies created by that internal coordination.
Recalling one matter, Aminata explained that she later realised she had been billed for internal meetings during which lawyers briefed one another on facts she had already provided. From the client’s perspective, such discussions formed part of the firm’s own internal management rather than legal advice delivered to the client.
Her observations reflected an important distinction. Clients are prepared to pay for legal expertise, strategic advice and specialist knowledge. They are becoming less willing to pay for internal processes that do not directly contribute to solving the client’s problem.
Artificial intelligence further sharpens that distinction. If technology enables firms to streamline internal communication, manage knowledge more effectively and reduce administrative duplication, clients increasingly expect those efficiencies to benefit the overall service rather than merely improving the firm’s internal productivity.
Taken together, the remarks of Olga Dmytriyeva and Aminata Ba illustrated a broader evolution in client expectations. Corporate legal departments are not simply asking whether law firms use AI. They are increasingly evaluating whether those firms use technology responsibly, communicate openly about its impact and translate technological efficiencies into meaningful client value.
Market forces are accelerating the conversation
The broader commercial implications of these changing expectations were explored during the keynote address by Nikki Shaver, Chief Executive Officer and Co-Founder of LegalTechnologyHub, at LegalTechTalk 2026, titled “The Dilemma Zone: Why Legal’s Inflection Point Demands New Thinking.”
Presenting research on the rapidly evolving legal technology market, Shaver noted that corporate adoption of AI had risen significantly, increasing from approximately 24 per cent to 52 per cent within a year. Organisations that had once prohibited the use of generative AI were increasingly integrating it into their own operations and, in many cases, expecting external advisers to do the same. This shift, she suggested, fundamentally changes the relationship between clients and law firms.
As AI becomes embedded within legal workflows, the conversation inevitably extends beyond productivity. It begins to affect commercial expectations, service delivery and pricing. Clients who understand that technology enables work to be completed more efficiently are likely to ask how those efficiencies are reflected in legal services.
Nikki did not suggest that the traditional economic model had already been replaced. On the contrary, she observed that while firms were experiencing significant productivity gains, the wider financial consequences were still unfolding.
As she remarked:
“We haven’t yet seen the impact on the bottom line. We haven’t yet seen that economic model shift, but it’s coming.”
Her observation captured the central tension emerging across both conferences. Artificial intelligence is already transforming the way legal work is performed. The commercial structures governing that work are beginning to respond, but they remain in transition.
By bringing together the perspectives of corporate clients and market analysts, LegalTechTalk 2026 highlighted that the discussion surrounding the billable hour is no longer confined to law firms themselves. It is increasingly being shaped by the expectations of sophisticated clients who measure legal value not only through technical excellence but also through efficiency, transparency and commercial understanding.
Efficiency expectations extend beyond law firms
Similar themes emerged beyond the law firm-client relationship during the discussions at International Arbitration Centre (IAC) Eurasia Arbitration Week 2026. Reflecting on the findings of the 2025 Queen Mary International Arbitration Survey, Professor Loukas A. Mistelis observed that users of international arbitration continue to prioritise efficiency, cost and confidentiality. The survey indicated growing demand for expedited procedures, stronger case management and the early disposal of unmeritorious claims, demonstrating that parties increasingly expect dispute resolution processes to deliver outcomes without unnecessary delay. While acknowledging that arbitration remains expensive for many users, Professor Mistelis emphasised that cost matters, even as he described international arbitration as a luxury market akin to the private health service, where parties willingly pay for specialist expertise, procedural flexibility and confidentiality.
His observations reinforce an important point emerging across LegalTechTalk 2026. Premium pricing is not itself under challenge, rather, clients increasingly expect that higher costs are justified by demonstrable value. Even where users are prepared to pay for specialist legal services, they are becoming more focused on whether those services are delivered efficiently and whether technology is being used to eliminate unnecessary cost and delay. As artificial intelligence streamlines many procedural and administrative aspects of legal work, those expectations are likely to become even more pronounced.
Law firms are being forced to reconsider what clients actually pay for
If the discussions involving general counsel at LegalTechTalk 2026 reflected changing client expectations, conversations among law firm leaders revealed that firms themselves are grappling with an equally fundamental question. Artificial intelligence is undoubtedly making legal work faster, but speed alone does not explain how legal services should be priced. As AI continues to automate drafting, research and document review, law firms are increasingly being compelled to examine whether the traditional relationship between time and value can continue to underpin their commercial models.
This was not presented as a debate over whether the billable hour should be abolished. Indeed, no speaker suggested that hourly billing would disappear altogether, particularly in complex disputes or bespoke advisory work where the scope of work remains inherently unpredictable. Instead, the discussions centred on a more nuanced proposition: if AI significantly reduces the time required to complete certain legal tasks, firms must begin asking whether time alone can continue to serve as the profession’s primary measure of value.
That tension was perhaps most directly articulated by Simon Ridpath, Managing Partner of Charles Russell Speechlys, during the panel “From AI Pilots to Firm-Wide Capability: What Comes Next?”
Reflecting on the organisational impact of AI adoption, Simon observed that law firms had historically built almost every aspect of their business around one central organising principle the chargeable hour. Recruitment, associate progression, partner remuneration, profitability and client billing all ultimately traced back to time. AI, however, was exposing the limitations of that framework.
As he candidly remarked:
“Our organisational principle around chargeable time is the one that has to be busted.”
Simon‘s observation did not amount to a prediction that firms would immediately abandon hourly billing. Rather, it recognised that AI is disrupting the assumptions upon which the model has traditionally operated. When technology is capable of completing in minutes work that previously required several hours of lawyer time, firms can no longer rely solely on effort as the principal indicator of value. The challenge, therefore, is not merely technological but structural. Law firms must determine how productivity, profitability and client value should be measured in an environment where efficiency is increasingly driven by software rather than by human labour.
The complexity of that transition was echoed by Christy Bentz, Chief Client Value and Innovation Officer at Norton Rose Fulbright, who described the profession as operating between two commercial realities.
On the one hand, firms continue to depend upon longstanding business models that reward chargeable hours and utilisation. On the other, they are investing heavily in technologies designed to reduce precisely those hours.
Explaining this dilemma, Christy remarked:
“We are actually going to be running in two models.”
Her comments captured one of the central themes emerging throughout LegalTechTalk 2026. AI adoption is no longer simply about deploying new technology; it is about managing a period during which old and new commercial models must coexist. Firms remain accountable to existing partnership structures and financial expectations while simultaneously responding to clients who increasingly expect faster, technology-enabled legal services.
The transition, therefore, cannot occur overnight. Instead, it requires firms to reconcile two competing realities, preserving the commercial stability of today’s business while preparing for a future in which efficiency itself may no longer justify the same pricing structures.
The question then becomes what replaces time as the defining measure of legal value.
During the panel “What If You Were to Build a Law Firm from the Ground Up?”, Lucy Murphy, Chief Growth Officer, Linklaters, suggested that the answer is unlikely to be found in a single pricing model. Rather than portraying AI as the catalyst for abandoning traditional partnerships, she argued that successful firms would need to embrace greater commercial flexibility. Different forms of legal work, she suggested, naturally lend themselves to different commercial approaches.
Highly specialised strategic advice may continue to command premium pricing, while routine or repeatable legal services may increasingly move towards fixed-fee or subscription-based arrangements. Her remarks reflected an acknowledgement that AI does not affect every aspect of legal practice equally. Consequently, neither should it require every legal service to be priced in the same way.
Taken together, the observations of Simon, Christy and Lucy reveal an important shift in how law firm leaders are approaching AI. The debate is no longer confined to whether firms should adopt artificial intelligence; that question has largely been settled. Instead, the more difficult conversation concerns how AI reshapes the economics of legal practice itself. If technology continues to reduce the amount of time lawyers spend producing legal work, firms must increasingly demonstrate that clients are paying not merely for hours worked but for expertise, judgment and commercial outcomes.
That theme was reinforced from another perspective during the “Design Thinking in Legal: Real Examples, Real Outcomes”. Anna De Stefano, Founder, ADS Studio — Legal Design for Trust & Value in the AI era, argued that AI itself would soon cease to be a meaningful differentiator because access to sophisticated technology would become increasingly universal.
As she observed:
“Everybody is going to use AI. Everybody is going to use the same tool. So how do you remain relevant?”
Her answer shifted the conversation away from technology and towards client value. Firms, she argued, would distinguish themselves not by possessing AI but by understanding their clients’ businesses, designing legal services around commercial needs and delivering advice that technology alone cannot replicate. In that context, efficiency becomes a baseline expectation rather than a competitive advantage.
David Planes, Head of Product at Lexidy, extended this discussion by examining pricing from the client’s perspective. Comparing traditional hourly billing to entering a taxi without knowing the fare until arriving at the destination, he argued that predictability itself has become an important component of legal value. Where technology enables routine legal work to be delivered more consistently, clients increasingly expect greater certainty regarding both cost and outcomes. AI therefore creates opportunities not simply to perform work faster but to rethink how legal services are packaged and priced.
The discussion also explored how AI should change the lawyer’s role itself.
Ellie Heiland, Independent Consultant, Writer & Podcast Host, argued that the greatest opportunity created by technology was not simply completing existing work more quickly. Instead, efficiency should free lawyers to devote more attention to strategic thinking, broader commercial advice and issues that clients might otherwise leave unexplored because of time or cost constraints. Viewed in that light, AI becomes less a mechanism for reducing lawyer involvement and more a tool for redirecting lawyer effort towards higher-value work. The implications extend beyond productivity.
If lawyers spend less time producing routine documents and more time advising clients on complex risks and strategic decisions, the profession’s value proposition naturally shifts away from measuring effort towards measuring expertise.
Viewed collectively, these discussions reveal that AI is not forcing law firms to choose between hourly billing and alternative fee arrangements. Rather, it is compelling them to reconsider a more fundamental question: what exactly are clients paying for? If technology increasingly reduces the labour involved in producing legal work, the profession’s commercial value must increasingly lie elsewhere – in strategic advice, commercial understanding, trusted relationships and professional judgment.
The billable hour may continue to remain an important part of legal practice, but across LegalTechTalk 2026, speakers repeatedly suggested that it can no longer be the only lens through which legal value is understood.
If AI produces the work, what are lawyers ultimately selling?
The discussions on pricing and commercial models at LegalTechTalk 2026 inevitably lead to a broader question. If artificial intelligence is increasingly capable of producing first drafts, reviewing documents, summarising evidence and accelerating legal research, what remains the lawyer’s primary contribution? Put differently, if clients are no longer paying merely for the time taken to prepare legal work, what exactly are they paying for?
Although LIDW 2026 approached artificial intelligence from the perspective of arbitration rather than law firm economics, its discussions provided an important answer. Across multiple sessions, speakers consistently argued that AI should not be understood as replacing legal expertise. Rather, it changes where that expertise is exercised. As routine tasks become increasingly automated, the lawyer’s value shifts from producing legal material to evaluating, challenging and ultimately taking responsibility for it.
Charlie Morgan, Partner at Herbert Smith Freehills Kramer, captured this distinction during a session – The Human Fight Back in Arbitration: Why AI Doesn’t Have All the Answers, examining the practical use of AI in dispute resolution. While acknowledging that generative AI has become an increasingly useful tool for legal professionals, he cautioned against treating it as a substitute for legal reasoning. Technology, he explained, can generate ideas, structure arguments and assist with research, but it cannot assume responsibility for the conclusions ultimately placed before a court or arbitral tribunal. That responsibility remains with the lawyer.
As he reminded delegates,
“You do the hard thinking.”
Charlie‘s observation reflected a recurring concern throughout LIDW 2026. Artificial intelligence is exceptionally effective at generating information, but generation is not the same as judgment. Lawyers must continue to determine whether AI-generated analysis is legally accurate, strategically appropriate and supported by reliable authority. In that sense, AI reduces the time spent creating legal content, but it increases the importance of critically evaluating what technology produces. His warning became even more significant when discussing the inherent limitations of generative AI. Referring to one of the technology’s most widely recognised shortcomings, Charlie remarked:
“AI has been designed to make things up.”
The comment was not intended as a criticism of artificial intelligence itself. Rather, it served as a reminder that generative AI operates by predicting language rather than independently verifying legal accuracy. Consequently, even highly persuasive outputs may contain fabricated authorities, inaccurate citations or flawed legal reasoning if accepted without careful scrutiny. For legal practitioners, the lesson was clear: efficiency cannot come at the expense of professional responsibility.
That theme was developed further by Dmitri Evseev, Arbitra, who reflected on how AI is already reshaping day-to-day legal practice. Rather than suggesting that lawyers were becoming less important, Evseev argued that the nature of legal work itself is evolving. As he succinctly observed,
“We are all going to be drafting less and reviewing more.”
Although deceptively simple, the remark encapsulated one of the defining shifts discussed across both conferences. Generative AI undoubtedly reduces the time required to prepare initial drafts, organise documents and identify relevant authorities. Yet those gains do not eliminate legal work, instead, they redistribute it. Lawyers increasingly devote less time to producing legal text and considerably more time to testing its accuracy, verifying its sources and refining its reasoning before it reaches clients or tribunals.
Viewed alongside the discussions at LegalTechTalk 2026, Dmitri‘s observation also offers an explanation for why clients are beginning to reassess legal pricing. If AI is capable of completing the mechanical aspects of drafting more efficiently, clients naturally expect those efficiencies to be reflected in the service they receive. At the same time, however, the lawyer’s responsibility has not diminished. It has merely shifted towards review, verification and professional accountability. The commercial challenge for law firms therefore lies not in proving that lawyers continue to spend time on a matter, but in demonstrating the value of the judgment exercised throughout that review process.
The importance of that judgment was reinforced by Mark Feldner, Co-founder and Chief Executive Officer of Crimson, who addressed perhaps the most practical issue confronting lawyers using AI in professional practice – trust. Rather than encouraging practitioners to rely upon AI-generated answers, Feldner urged them to place their confidence in the underlying legal materials from which those answers are derived. As he explained,
“You should be trying to ground the results in source data that you trust and know.”
His remarks underscored a fundamental distinction between information and authority. Artificial intelligence can rapidly identify patterns, summarise large volumes of material and suggest potential legal arguments, but it does not itself become a source of law. The responsibility for confirming that every authority is genuine, every proposition is legally sustainable and every submission accurately reflects the law continues to rest with the lawyer. In other words, AI may assist legal analysis, but it cannot assume legal accountability.
When considered together, the remarks of Charlie, Dimitri and Mark reveal a common thread running throughout LIDW 2026. Artificial intelligence is not replacing the lawyer’s role; it is relocating the point at which lawyers create value. Increasingly, that value lies not in producing documents but in exercising judgment over them, not in generating legal arguments but in determining whether those arguments are correct, persuasive and ethically defensible. That transition also explains why the discussions at LIDW 2026 complement those at LegalTechTalk 2026. While one conference explored how AI is changing the economics of legal practice, the other illustrated why human judgment remains the profession’s most valuable commodity.
Also Read: Why Lawyers Keep Getting AI Wrong and Why Human Judgment Still Matters: Insights from LIDW 2026
AI makes professional judgment more not less important
The same theme was observed during IAC Eurasia Arbitration Week 2026, where discussions on AI governance focused not simply on technological capability but on the continuing professional obligations of lawyers. Speaking on the panel “AI in Arbitration: Appropriate Use, Limits & Ethics”, Dr. Kabir Duggal observed that clients are increasingly asking law firms how they intend to use AI, while organisations themselves increasingly view AI as “a cost-saving measure”.
Yet he cautioned that although AI can rapidly review documents and generate summaries, responsibility for the final legal product remains entirely human. Reminding practitioners to “trust, but verify,” he emphasised that lawyers and arbitrators remain responsible for validating AI-generated work before relying upon it. His observations reinforce a recurring theme throughout LegalTechTalk 2026 and LIDW 2026: clients increasingly expect firms to embrace AI to improve efficiency, but they continue to pay for the independent judgment and accountability that technology cannot replace.
That responsibility was reinforced during Cyprus Arbitration Days 2026, where Alexander Marcopoulos warned against what he described as “intellectual outsourcing”. While acknowledging that AI may resemble a highly capable junior associate, he argued that practitioners must resist the temptation simply to accept AI-generated outputs without independent analysis. Responsible AI use, he suggested, depends upon lawyers critically interrogating technology rather than delegating their reasoning to it. His remarks neatly complement the observations of Charlie, Dmitri and Mark. As AI assumes a greater share of drafting and information processing, the lawyer’s distinctive value increasingly lies in exercising independent judgment, verifying legal accuracy and remaining ethically accountable for every piece of advice ultimately delivered to the client.
Judgment is becoming the profession’s most valuable product
This shift was explored from the perspective of governance by Stéphane Altounian, who argued that technological capability must always be matched by institutional responsibility. Organisations, he suggested, often focus considerable attention on acquiring AI tools while paying comparatively less attention to the governance structures necessary to ensure that those tools are used responsibly. Yet the two cannot be separated. The greater the capability of artificial intelligence, the greater the importance of human oversight.
Stéphane‘s observations reinforce an important distinction that surfaced repeatedly throughout both conferences. AI can undoubtedly improve efficiency, but efficiency does not automatically produce trust. Trust depends upon clear governance, professional accountability and confidence that legal advice has been independently assessed before reaching the client. In practice, this means that AI increases rather than diminishes the importance of experienced lawyers capable of supervising technology, identifying its limitations and intervening where necessary.
Also Read: Why Lawyers Keep Getting AI Wrong and Why Human Judgment Still Matters: Insights from LIDW 2026
The same concern surfaced during LegalTechTalk’s discussions on “How to Build and Empower Lawyers of the Future”. While much attention surrounding AI focuses on what technology can now accomplish, several speakers questioned what those developments mean for the next generation of lawyers entering the profession.
Jon English, Director of Content Innovation at LexisNexis, observed that many of the tasks increasingly performed by AI-legal research, document review, preparing first drafts and organising information, have traditionally played an important educational role within law firms. Junior lawyers developed analytical skills through precisely these activities. If technology assumes responsibility for much of that work, firms must ensure that younger lawyers still receive opportunities to cultivate the judgment expected of future senior practitioners.
Sarah Chambers, Director — Ashurst Advance, Digital Experience at Ashurst, similarly argued that legal education and professional development would need to evolve alongside technological change. Technical legal knowledge will undoubtedly remain essential, but qualities such as critical thinking, curiosity, communication, collaboration and professional judgment will become increasingly valuable in an environment where AI can already perform many routine legal functions. Rather than competing with technology on speed alone, future lawyers will increasingly distinguish themselves through capabilities that artificial intelligence cannot easily replicate.
Simon Levine, Former Global Co-CEO of DLA Piper and Managing Director of ALSASO, placed this discussion within a broader strategic context. Reflecting on the future direction of legal practice, he suggested that firms should not view AI merely as another productivity tool. Instead, they should recognise that technology creates opportunities for lawyers to devote more time to strategic advice, client relationships and complex problem-solving, areas in which human judgment continues to provide the greatest value. The profession’s competitive advantage, therefore, is unlikely to lie in producing documents more quickly than AI. It will lie in helping clients navigate uncertainty, exercise informed judgment and make commercially sound decisions where the law itself may not provide straightforward answers.
Taken together, these discussions reinforce a consistent theme emerging across both conferences. Artificial intelligence is steadily reducing the amount of routine labour involved in legal practice, but it is simultaneously increasing the importance of those responsibilities that cannot be delegated to technology. Lawyers remain accountable for interpreting the law, advising clients, managing legal risk and standing behind every opinion they provide. Those responsibilities cannot be automated simply because the process of producing legal work has become more efficient.
It was against this backdrop that Rory O’Keeffe, Founder, RMOK Legal Consulting, made remarks during the session on “What If You Were to Build a Law Firm from the Ground Up?” Reflecting on the rapid pace of technological change, he cautioned against assuming that competitive advantage would come merely from adopting the latest AI tools. Technology, he suggested, is becoming increasingly accessible across the profession. What will continue to distinguish lawyers is not the software they use but the confidence clients place in their judgment.
As he observed:
“Clients do not buy code. They buy courage. They buy your judgement.”
Conclusion
No speaker argued during the conversations across LegalTechTalk 2026 and LIDW 2026 that hourly billing would disappear altogether, nor did anyone suggest that artificial intelligence would replace lawyers in complex legal practice. Instead, the discussions point towards a more measured, but equally significant, transformation.
Whether the billable hour ultimately remains the dominant pricing model is a question that only time will answer. What is already becoming clear, however, is that the legal profession is moving towards a future in which clients are likely to measure value not only by effort expended, but by insight provided, risks managed, decisions informed and confidence inspired. In an AI-enabled profession, those qualities may prove to be the lawyer’s most enduring and most valuable offering.
