Legaltech vs Lawtech. What is the difference between legaltech and lawtech? Is there a difference and does it matter? Short answer: it depends on who you ask!
Broadly speaking the views on this question fall into 3 camps:
01 Legaltech is for lawyers, and lawtech is for clients
Legaltech is technologies lawyers use to streamline their work (e-discovery, AI/ML document review etc) whereas Lawtech is software used to deliver products for their clients (legal chatbots, online marketplaces).
Supporters of this view include Richard Susskind, author, speaker, and independent adviser to major professional firms and to national governments. He is regarded as one of the world’s leading authorities on technology in the legal sector, having written several popular (and sometimes controversial) books, including The End of Lawyers and Tomorrow’s Lawyers.
Susskind’s view is that Legaltech refers best to:
In many ways, this is perhaps slightly narrower and aligned to the traditional view of legaltech: backbone IT (accounting, filing, and management systems) needed to keep the lights on and run the back-office, but not necessarily front-office technologies lawyers use to streamline their work or enable new products and services.
They distinguish between software such as Lex Machina – a legal research tool used by lawyers – as an example of legaltech, and Rocket Lawyer, a lawtech product providing online legal services to individuals and small to medium-sized businesses.
02 Lawtech is the wrong term altogether
Richard Tromans, founder of Tromans Consulting and leading legaltech blog Artificial Lawyer, posits that the “legal” in “legaltech” makes clear its use refers to the “legal market” or “legal sector“, i.e. in the same way similar terms like fintech, regtech, proptech and insurtech are used.
Tromans does suggest Lawtech might have a place if it is used to refer to a sub-group of tasks directly related to the Law itself, e.g. “tech that focused on drafting laws, or perhaps helped students to understand legal issues.“
This makes sense. When thinking in terms of industry sectors, “legal sector” is the norm. “Law sector” is not.
However, distinctions between terms referring to industry sectors (legal), and the subjects (laws) of those sectors are perhaps more brittle than they seem.
Regtech is a good example.
There isn’t so much a regulatory sector, but rather regulated markets or industries.
Finance is the prototypical example.
Indeed, regtech is viewed by the UK’s Financial Conduct Authority as a subset of fintech. Together the two terms emerged following the 2007/2008 financial crisis to describe a new cache of technology solutions aimed at streamlining or reinventing financial processes, and with respect to regtech, the burden of managing the increased regulatory overhead imposed on banks post-crash.
In other words, there isn’t a market or industry for regulations, but there are plenty of markets constrained by regulations. Added to that, apart from the overlap with fintech, regtech often overlaps with legaltech (given lawyers often provide regulatory advice and products and services).
The point here isn’t that the above distinction – between legaltech (describing a sector) and lawtech (describing its subject) – isn’t useful, but rather imprecise and imperfect.
Much like natural language generally!
03 Legaltech encompasses lawtech
In other words, viewed this way: legaltech encompasses lawtech. Or precisely, legaltech encompasses the first view’s definition of lawtech (i.e. tech that improves consumer access to legal products and services).
But wait… what about Legal IT?
“there were two hashtags: #LegalTech, short for legal technology or tech that was used to support law firm operations, e.g. practice management systems, document management systems, CRM systems. #LegalIT was generally managed by an IT director (most law firms have an IT director rather than a CTO), whose responsibility was choosing, implementing and maintaining a standard suite of technology solutions, which would include IT security, websites, extranets, email management, mobile communications.”
In 2021, Legal IT still tends to find most usage among IT experts, rather than lawyers and legal consumers.
And as we’ve noted above, legaltech can mean everything from back-office IT to front-office lawyer transforming tech, or even B2C consumer facing tech.
But Goodman’s point is a good one: one of the factors for the varying nomenclature is in part, the decision-makers involved. Traditionally IT was the exclusive domain of IT experts, particularly in law firms and large legal teams, hence individuals in those roles tended to, and still tend to, use the term Legal IT.
Today, this is less so.
Increasingly technology selection, testing, development and adoption is driven by a smorgasbord of individuals, including lawyers, IT directors, innovation teams, project managers, change managers and clients. Among this group, particularly the non-IT experts, legaltech is more commonly used.
In other words, what is legaltech, lawtech or legalIT is in the eye of the beholder!
Does it matter?
It depends. A classic legal response!
Viewed as legaltech for lawyers and lawtech for clients (view 1 above), there is an inherent competition between the two terms and what they represent.
Viewed this way, lawtech is aimed at reducing the need for lawyer input, or removing their input altogether, and allowing clients to self-serve their own legal products and services where appropriate.
Taken to the extreme, this could mean fewer lawyers altogether.
Or at least in the sense of fewer “traditional” lawyers and a greater number of technician roles (for want of a better term) aligned to specific consumer needs, e.g. in the same sense that there are general practitioner and specialist doctors (much like traditional lawyering) but also a greater number of highly specialised technical roles aligned to standardized processes assisted by technology, such as anaesthetists.
Naturally, this competes with traditional lawyers, who wish to provide those products and services, and may be seeking to do so more effectively via legaltech.
There are some genuine, and perhaps increasing, instances where lawtech (tech for clients) is eating into work traditionally undertaken by law firms.
And this includes solutions focussed on legal documents, but also entire legal processes and disputes.
For instance, Farewill streamlines the entire process of creating a will via an easy to follow wizard-driven online process, or Amicable which provides alternative resolution to family law matters such as divorce (find out more about them here).
These developments mirror similar reinventions of traditional and sluggish processes, often in adjacent spaces, e.g. Habito’s desire to streamline mortgage lending via alternative resourcing, tech and a great user experience.
However, even if there is some argument for defining legaltech for lawyers and lawtech for clients, the reality is the underlying tech is often the same or almost identical.
DocuSign is a good example.
Law firms use it to expedite signings. DocuSign makes it significantly easier for clients to sign their documents vs the traditional method of being emailed the documents, downloading the docs, printing the docs, wet-ink signing the docs, scanning (or photographing) the docs and emailing back the signed docs.
But equally, many consumer-facing organisations providing self-service legal services or legalish type products and services use DocuSign for similar reasons, e.g. DocuSign is frequently used to sign paperwork for retail banking.
Similarly, most client-facing platforms that involve document automation typically rely upon one of the major vendors, white-labelling the product and wrapping it with a custom interface.
Making things more overlapped is the fact law firms providing lawtech (in the sense of client-facing tech) often do the same.
Viewed from the perspective of the underlying tech, there is little difference between legaltech and lawtech, or between either and tech generally.
Search Engine Optimization (SEO) and Marketing
For instance, compare Legaltech vs. Lawtech searches over 2020:
Globally, Legaltech is the winner in terms of no. of searches (as at the time of writing).
However, as at January 2021, regionally, Lawtech does fare slightly better in Australia, Brazil and the UK:
For the UK, where this site is based, as at January 2021 of all legaltech and lawtech searches, lawtech comprises 61% of the search volume vs 39% for legaltech.
If you’re a vendor, the distinction might make a difference in terms of the traffic your site / app receives, but also the targeting of high quality and converting leads.
Between legaltech vs lawtech the real difference with a distinction is perhaps SEO!
It’s rare for anyone to pick a fight over the use of legaltech vs lawtech. The two terms are used so interchangeably it probably doesn’t matter which you use. At best, the distinctions between the two terms are somewhat artificial, and of little real importance in the grand scheme of things.
But if you are a legaltech / lawtech start-up, you may want to research how legaltech vs lawtech trend over time from an SEO and marketing perspective!