PUBLISHER: Roots Analysis | PRODUCT CODE: 1787833
PUBLISHER: Roots Analysis | PRODUCT CODE: 1787833
As per Roots Analysis, the global legal AI software market size is estimated to grow from USD 1.53 billion in the current year to USD 14.62 billion by 2035, at a CAGR of 22.77% during the forecast period, till 2035.
The opportunity for legal AI software market has been distributed across the following segments:
Type of Component
Type of Deployment
Type of Pricing Model
Type of Technology
Areas of Application
Type of End Users
Company Size
Type of Business Model
Geographical Regions
Legal AI software encompasses the application of artificial intelligence technologies within the legal sector to automate and improve various legal tasks. This technology employs methods such as machine learning and natural language processing to carry out functions like contract analysis, legal research, due diligence, document examination, and predictive analytics. Additionally, these tools can automatically detect pertinent changes and notify legal teams, ensuring they remain updated. AI-driven legal software is adept at automatically extracting and analyzing terms, clauses, and provisions in contracts to pinpoint possible compliance challenges.
The global market for legal AI software is experiencing notable growth, driven by several key factors. A significant contributor to this market expansion is the rising incorporation of artificial intelligence (AI) technologies in the legal field. The increasing demand for AI in legal services is leading to a substantial need for legal AI software on a global scale. This progress is resulting in a decrease in the time required to resolve legal cases and render decisions based on the urgency of hearing these cases and the legal framework within specific timeframes. Owing to the growing necessity for automation in both attorney and clerical tasks, the legal AI software market is expected to experience significant growth during the forecast period.
Based on type of component, the global legal AI software market is segmented into services and solutions. According to our estimates, currently, the solutions segment captures the majority share of the market. This can be attributed to fact that legal tasks and processes necessitate the implementation of AI software platforms and solutions in the systems used by end users. To protect the sensitive information involved in these processes, regulatory bodies must focus on establishing comprehensive regulations for AI-integrated legal software
However, the market for services segment is expected to grow at a higher CAGR during the forecast period, owing to the rising demand for the efficient execution of diverse legal tasks.
Based on type of deployment, the legal AI software market is segmented into cloud, hybrid and on-premises. According to our estimates, currently, cloud-based segment captures the majority of the market. This can be attributed to the flexibility, scalability, and cost-effectiveness that cloud-based solutions provide. The growing emphasis on accessibility and efficiency by law firms is boosting the cloud segment's market share, as these solutions allow users to access extensive databases of legal documents and case law from any location and at any time, which is crucial for agile legal practices.
Based on type of pricing model, the legal AI software market is segmented into one-time license, pay-per-use and subscription. According to our estimates, currently, subscription pricing model, captures the majority share of the market. This can be attributed to its flexibility and ability to generate ongoing revenue. This option allows users to benefit from regular updates and support, which attracts law firms and corporate legal departments to invest in this area.
However, pay-per-use model is expected to grow at a relatively higher CAGR during the forecast period. This growth can be attributed to its appeal for organizations that prefer to only pay for the services they have used, offering a more cost-effective solution for smaller firms.
Based on type of technology, the legal AI software market is segmented into machine learning (ML), natural language processing (NLP), predictive analytics, and robotic process automation (RPA). According to our estimates, currently, machine learning (ML) segment captures the majority share of the market. This can be attributed to the increasing use of machine learning in the legal field to create advanced algorithms that can analyze extensive amounts of legal data, extract valuable insights, and automate numerous legal processes.
However, natural language processing (NLP) segment is expected to grow at a relatively higher CAGR during the forecast period. Key factors driving this growth include the necessity to save time and enhance the efficiency of legal research, as this legal AI technology is a branch of artificial intelligence that focuses on the interaction between humans and computer language.
Based on areas of application, the legal AI software market is segmented into case prediction, compliance, contract review and management, e-billing, e-discovery and legal research. According to our estimates, currently, e-discovery segment captures the majority share of the market. This can be attributed to the rising volume of electronic data resulting from the legal industry's digitization. Further, several other factors, such as the rise of digital communication channels and the expansion of cloud computing, are also playing a role in the growth of this segment.
Based on type of end users, the legal AI software market is segmented into legal departments, government agencies, and law firms. According to our estimates, currently, law firms captures the majority share of the market. This can be attributed to the rising investment in AI within law firms. In addition, AI tools for law firms have shown to be extremely beneficial due to their capability to quickly and accurately process and evaluate large volumes of legal data, which is driving the expansion of this segment.
Based on type of enterprise, the legal AI software market is segmented into large and small and medium enterprise. According to our estimates, currently, large enterprise segment captures the majority share of the market. However, the small and medium enterprise is expected to grow at a relatively higher CAGR during the forecast period. This can be attributed to their flexibility, innovative approaches, focus on specialized markets, and capacity to adjust to evolving customer preferences and market dynamics.
Based on geographical regions, the legal AI software market is segmented into North America, Europe, Asia, Latin America, Middle East and North Africa, and the rest of the world. According to our estimates, currently, North America captures the majority share of the market. This can be attributed to high concentration of legal technology firms, law practices, and legal departments in the area. Additionally, the rising demand for greater efficiency, cost savings, and better decision-making capabilities is also fueling the growth of this market within North America.
The report on the legal AI software market features insights on various sections, including: