Why Legal Departments Like the Cloud More than Law Firms

Law Technology News has published some recent survey results on the legal cloud: adoption of cloud computing by lawyers. Apparently corporate legal departments use much more cloud computing applications than law firms. This should not be too surprising for several reasons. First off, a corporate legal department often has a much bigger capital budget than the typical law firm. After all, a company large enough to afford its own legal department most likely dwarfs the typical American law firm with only four lawyers or less. Second, legal departments see other areas of their company running exciting applications in the cloud, which validates the technology, demonstrates the budget savings, emphasizes the speed of deployment and lesser maintenance, and might even trigger a good bit of envy. These kinds of incentives simply don’t exist in the small law firm environment (and not much even among large firms), so there is less interest for outside counsel in the legal cloud.

Let’s get to the numbers (you can see them here: http://bit.ly/pCf9pP):

More than half of legal departments surveyed use such services — a much higher exposure than law firms have managed so far. For storage, 6 percent of law firms are in the cloud vs. 22 percent of in-house departments. For document management, it’s 5 percent for law firms vs. 62 percent for in-house. Nearly a third of legal departments take care of spam filtering and e-mail management in the cloud. But 26 percent of respondents say the savings achieved have not been what they foresaw, thanks in part to subscription and license fees. And there are familiar worries: 65 percent complain services aren’t customizable enough, 39 percent fear problems with security, and 16 percent feel they don’t have enough control over their data.

I’m quite surprised to hear that 62% of corporate legal departments are managing their documents in the cloud. This number might be skewed by limited experimentation with Drop Box or similar applications. It would be interesting to know to what degree these departments are putting their entire, critical functions into cloud applications. I have a feeling we are still quite far away from the majority of legal departments fully embracing the legal cloud.

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