The billable hour is not dying but is structurally bifurcating

Legora's analysis argues that AI's core impact on pricing is predictability rather than efficiency alone: once AI makes specific task categories consistent and repeatable, firms gain the cost certainty needed to price fixed fees accurately. The 2025 Best Law Firms survey shows 72% of U.S. firms now offer AFAs, rising to 90% among firms with more than 50 lawyers, but "shadow billing" — clients demanding hourly tracking on flat-fee matters — means that AFA adoption understates the degree to which the hourly model still anchors the underlying economics. The result is a de facto pricing commitment embedded in ostensibly hourly arrangements: win work by estimating $1 million and bill $2 million, and the next panel review goes differently.