Login
Is client demand set to spawn an era of value pricing?
Evolving expectations from clients, together with the continued embrace of new technologies, will see non-traditional billing models “dominate” legal services this year, one tech GM predicts.
Jerome Doraisamy
In conversation with Lawyers Weekly towards the end of last year, Clio founder general manager (APAC) Denise Farmer proclaimed that 2025 will be the “era of flat-fee billing”.
Such billing models, she predicted, “will dominate legal services” by the end of this year.
“In response to client demand for predictable pricing, firms will abandon hourly rates in favour of flat fees,” she said.
“This will be especially evident in family law, real estate, and estate planning, which involve more repeatable, well-defined tasks that can be tailored to the client’s needs without requiring extensive, unpredictable litigation.”
“As the market shifts towards transparency and stability, it is important for law firms to consider making the transition to flat-fee billing to meet customer expectations.”
In the same conversation, Farmer suggested that unprecedented jockeying for position looms large for smaller law firms because of the advent of legal technologies.
The comments also follow Farmer’s recent appearance on LawTech Talks, alongside Clio chief executive Jack Newton, in which the pair discussed the “moral imperative” to adopt and utilise new technology and how those who do utilise it will “outpace” those who don’t.
The notion that the advent of legal technology will impact pricing for legal services is not new. In 2023, Lawyers Weekly explored the idea that the emergence of ChatGPT would result in an “inevitable decline” for billable hours.
This said, there are many corporate entities for whom time-based billing will remain suitable.
Speaking to Lawyers Weekly a few years back, Gilbert + Tobin chair Danny Gilbert – who was recently appointed to the Reserve Bank’s governance board – argued it is preferable, from the perspective of many clients, to retain a billing model whereby those clients can retain more control.
Either way, expectations from clients – ranging from big corporates to individual consumers – are most certainly evolving in the face of generative AI (GenAI), and thus, what will be critical is for external providers to ensure value is front and centre of the services offered.
Speaking on a recent episode of The Lawyers Weekly Show, Hive Legal executive director and experience designer Melissa Lyon spoke about the need for alignment between the value of legal services and an understanding by the client of that value.
What lawyers are ultimately offering clients, in the age of GenAI, she proclaimed, is outcomes.
“That is informed and complemented by the human in the loop – their subject matter, expertise, the experience, and knowledge of the client – factors that GenAI is not necessarily, at the moment, able to provide,” she said.
Jerome Doraisamy
Jerome Doraisamy is the editor of Lawyers Weekly and HR Leader. He has worked at Momentum Media as a journalist on Lawyers Weekly since February 2018, and has served as editor since March 2022. In June 2024, he also assumed the editorship of HR Leader. Jerome is also the author of The Wellness Doctrines book series, an admitted solicitor in NSW, and a board director of the Minds Count Foundation.
You can email Jerome at:
