For decades, law firms held the technology advantage over their clients. They had the infrastructure, the knowledge management systems, the research platforms. Corporate legal teams did the work; outside counsel owned the tools.
That dynamic has reversed.
The Numbers That Changed the Equation
In 2023, roughly 20% of general counsel were using generative AI. By 2025, that figure had reached 44%. Today, 87% of GCs report using generative AI, according to the FTI Consulting and Relativity General Counsel Report released this month. That's a fourfold increase in three years.
Law firms have not kept pace. The 8am 2026 Legal AI Report: Adoption, Usage and Readiness found that only 46% of firms have implemented general-purpose AI tools, and just 34% use legal-specific AI. The clients are running. The firms are walking.
The gap isn't just about which tools are installed — it's about organizational commitment. More than half of in-house departments now have formalized technology roadmaps, according to the General Counsel Report. Corporate legal is building infrastructure. Many law firms are still running pilots.
What In-House Teams Are Actually Doing With AI
The consequence of that adoption gap is insourcing — quiet, incremental, and accelerating. The Brinks case study published by Thomson Reuters illustrates the pattern. The company deployed CoCounsel AI to automate contracts, research, and compliance work across 54 countries, reducing dependency on external counsel with documented cost savings. Brinks isn't an outlier. It's an early data point in a shift that's becoming standard practice across corporate legal departments.
The role of general counsel is changing alongside it. The Consilio 2026 Global Survey found that 71% of in-house legal respondents now view themselves as strategic business partners — up from 21% in 2025 and just 4% in 2024. That's not just a shift in self-perception. It's a shift in leverage.
The Billing Relationship Is Starting to Feel the Pressure
The efficiency gains are compressing what in-house teams are willing to pay for. Nearly half of legal professionals expect AI to change law firm billing practices, according to the 8am report. Among those expecting change, 25% anticipate spending fewer hours per matter and 22% expect a shift toward flat fees and alternative fee arrangements. Outside firms may soon be watching their pricing model erode from both directions — clients doing more internally and expecting to pay less for what remains.
Sophie Ross, Global CEO of FTI Technology, captured the shift in the General Counsel Report. General counsel now need structured training programs and technology roadmaps that enable innovation alongside risk mitigation. GCs are managing technology strategy, not just legal risk.
What This Means for Legal Tech Vendors
The in-house power shift rewrites a foundational assumption in legal tech go-to-market strategy. For years, the dominant sales motion ran through law firms — earn BigLaw validation, build credibility, sell downstream. That motion still works, but it no longer works alone.
In-house legal teams are now active technology buyers. They have formalized roadmaps, IT advocates embedded in procurement, and GCs reporting to boards on AI strategy. They evaluate tools on efficiency metrics and insourcing potential, not just research quality or firm pedigree.
The legal tech vendors who recognize that the client has become as sophisticated as the firm — and build their go-to-market accordingly — are the ones positioned to compete on both sides of a market that just fundamentally changed.
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