"Purpose-Built AI vs. General AI: The Bonfire vs. Blowtorch Analogy Mathew shares a powerful analogy from Daza Greenwood about the difference between general AI tools (ChatGPT, Claude, Gemini) and purpose-built legal AI. General AI is like a massive bonfire-incredibly powerful and versatile, but not specialized. Purpose-built legal AI is like taking that fire and harnessing it into a blowtorch - you can now weld with precision."
"Steve and Mathew tackle the question many law firms are considering: Can they escape the billable hour problem by switching to flat fees? The answer is no. Even with a $100,000 flat fee, sophisticated clients can calculate that if the work only took 2 hours with AI assistance, they're still massively overpaying. This reveals the "underscoping and overscoping problem" - lawyers struggle to accurately price fixed-fee work, which is exactly why flat fees never replaced the billable hour in the"
AI is shifting power toward sophisticated in-house legal teams by enabling accountability, transparency, and measurable benchmarking of outside counsel work. Purpose-built legal AI delivers domain-specific precision that allows in-house counsel to detect overbilling and question pricing. General AI remains versatile but unspecialized compared to targeted legal tools that provide actionable comparisons. Flat fees fail when AI-driven workflows reduce actual hours, exposing underscoping and overscoping mistakes and substantial overpayment. The combination of benchmarking, pricing visibility, and in-house sophistication creates acute pressure on legacy billable-hour business models and forces firms to rethink pricing and scope estimation.
Read at Above the Law
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