The Business of Law: Evolution of the Legal Services Market

Abstract

The legal services market is changing. This change has been driven by various factors through the years: expansion of in-house legal departments, globalization (through mergers and outsourcing), technological advances, and the rise of alternative legal service providers. This paper explores these factors in isolation—i.e., discussing each factor separately and distinctly from other factors. Then, this paper seeks to understand these factors together, as products of a legal services market that is evolving from the growth stage into the mature stage. Part I summarizes the early history of law firms, including the rise of the Cravath System through the Golden Era of the 1960s. Part II examines several factors affecting the legal services market, specifically: expansion of in-house legal departments, globalization (through mergers and outsourcing), technological advances, and the rise of alternative legal service providers. Finally, Part III discusses how these factors can also be understood together, as products of a maturing legal services market.