u/TieLiving8770

https://www.mckinsey.com/au/our-insights/australia-and-new-zealand-perspectives/shaping-the-law-firm-of-the-future

Just came across a McKinsey article on how AI will impact different legal practice areas namely in two ways:

1. automation displacement (where AI automation displaces the demand for human lawyers)
2. strategic transformation (where AI reshapes service models)

The levels of change is not explicitly described, but I suspect:

1. Transformative – the highest level of change
2. Significant – second highest
3. Emerging – third highest
4. Moderate – the lowest

Few things were as expected:

1. Transactional law taking the biggest hit.
   1. Especially M&A and banking and finance practice areas.
   2. They are anticipated to go through transformative and significant automation displacement respectively.
   3. I imagine a lot of its work can be automated easily.
   4. The demand for junior lawyers will shrink greatly over time.
2. Disputes and litigation also taking a hit.
   1. I anticipate legal research being done a lot quicker by single person using AI, although lawyers will continue to be careful about hallucinations.
   2. The demand for junior lawyers will shrink a lot over time.

Some things caught me by surprise:

1. Regulatory and compliance area also taking a big hit.
   1. McKinsey expects it to go through a transformative change.
   2. I expected limited impact due to the need for an actual human to interpret the fine lines of the law using human judgment.
2. Limited impact on transactional law
   1. AI impact on capital markets law and private equity law are described as moderate.
   2. I expected greater impact.
3. Limited impact on advisory law
   1. AI impact on most advisory practice areas described as either emerging or moderate.
   2. I expected greater impact on IP and tax law.

Would anyone care to explain:

1. why regulatory and compliance area is impacted greatly by AI?
2. why capital markets law and private equity law are going to have limited impact by AI?
3. why IP and tax law are going to have limited impact by AI?
4. I invite any other comments related to AI's impact on other practice areas, too.