A new report on non-traditional competition finds that while differentiation in law is becoming more difficult, there are also more opportunities to stand out
NEW YORK, Aug. 21, 2025 /PRNewswire-PRWeb/ -- Though many have heralded the imminent demise of the traditional law firm model for years, law firms have proven quite resilient. However, that resiliency is in strong part due to a willingness by many to change, to adapt to new market realities. As a new report by the Pacesetter Research team explores, one of the shifting factors for law firms is the competitive landscape which has grown from almost no non-law firms two decades ago to multiple categories of non-traditional competitors in 2025, all with steadily-expanding market share. And it's not just that there are more competitors today, but they engage legal departments very differently than law firms do, offering improved services and along the way, changing client expectations.
"Until about 20 years ago, a law firm could expect to receive just about every dollar spent by a legal department on external vendors," noted Tomek Jankowski, Director of Law.com Compass Pacesetter Research. "However, as legal departments are increasingly willing to unbundle services, the reality is that law firms are competing in an increasingly crowded field with a growing variety of providers. In other words, though many still do not realize this, they are competing for client (market) share."
But more than this, this research has found that these non-traditional competitors in legal markets are empowering midmarket law firms to, in many respects, punch above their grade and compete with larger law firms for some work.
Key trends identified in this research include:
- The competitive landscape is undergoing a profound shift in the legal space in ways that redefines competitive threats and opportunities for law firms, reflecting as much how law firms themselves are changing as what new entrants to legal markets are doing.
- This change has transformed what used to be fairly rote, automatic law firm structural details such as partner leverage or compensation models suddenly into key strategic business levers – complicating how law firms are managed, but also opening new opportunities for differentiation.
- A further important point to arise in this research is that a law firm's competitive environment doesn't begin at the front door but is inextricably tied to the firm's own internal processes and ultimate service delivery strategy.
- Non-traditional players have been growing their market share steadily in recent years and that trend has been accelerating – especially as legal departments prove more willing to unbundle services.
This report examines the traditional law firm structure and its competitive vulnerabilities and then delves into a competitive intensity study. It also covers funding as a competitive strength (or weakness) for law firms, reviews the findings of a survey conducted with CI professionals in law firms, and then explores client access – whom law firms usually speak with in client organizations versus non-traditional competitors. This report also includes profiles of select non-traditional competitors.
Law.com Pro and Law.com Compass Subscribers can now access the new reports by going to: http://www.law.com/compass.
About Law.com Compass Pacesetter Research
Law.com Compass Pacesetter Research provides independent, objective research to competitors in law markets relevant for both service providers and buyers alike, examining how innovation can inform decision-making processes. The ultimate focus for Pacesetter Research is how law firms (and their competitors) use innovation to have real client impact, to move the needle meaningfully for clients and other key stakeholders.
About ALM and LBR
ALM and LBR recently merged to form the premier global information and intelligence company serving the legal industry. Together, they provide unmatched coverage of legal news, proprietary data, performance benchmarking, and strategic insights, all built to support the business and practice of law. From global law firms to in-house legal departments, over 7 million legal professionals rely on ALM and LBR for the tools, research, and connections that drive results.
Media Contact
Janeanne Josephson, Law.com, 2124579582, [email protected], www.law.com
SOURCE Law.com
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