In-house counsel have gotten a lot more savvy about intellectual property, so much so that most law firms should not expect IP to be the major source of revenue, workload and growth potential in 2015 that it’s been in the past, according to a new survey.

After four years of growth the tide is turning, BTI Consulting Group says in its report, “BTI Intellectual Property Outlook: Changes, Trends and Opportunities in IP and IP Litigation.”

“Caseloads shrank by almost 12 percent in 2014, reflecting a more acute sense of strategic priority in managing intellectual property,” the report’s executive summary notes.

In-house counsel now have practical experience with IP litigation and the implications of the American Invents Act. And they are not only better at managing their organization’s IP but also at managing their IP law firms, the survey says.

To be sure, the market value to outside counsel for IP and IP litigation is $8.5 billion, according to the report. And the potential for slow but steady growth makes IP one of the most-sought-after practices for almost all law firms. IP litigation in particular has offered law firms the perfect mix of big cases with high stakes.

But according to the survey, IP litigation strategy will change significantly as in-house counsel double the number of cases they plan to settle.

In fact, more money is already spent on patent prosecution than litigation. According to the report, $3.5 billion, or 41.2 percent of the IP market, is spent on prosecution, while $2.97 billion, or 35 percent, is allotted for litigation.

In addition, in-house counsel are likely to turn to law firms knowledgeable about a company’s entire IP portfolio and that demonstrate exceptional business understanding. Law departments have recognized the value of strategic counsel, and they understand the importance of trademarks as their businesses expand globally, the survey says.

In the second half of 2014, in-house counsel plan to increase their caseload 8 percent against a budget increase of only 1.1 percent. They plan to use settlements, alternative fee arrangements and new work processes to keep costs in check, according to the report.

“As legal departments meet their goal of adding more value, these IP decision-makers are searching for law firms with piercing, strategic insight and are gravitating toward firms able to handle more of the IP portfolio—routine and complex,” the report’s executive summary says.

In fact, only about a dozen law firms are best positioned to deliver in all aspects of IP, according to the report. The “IP VIPs” include Baker Botts; Ballard Spahr; Brinks Gilson & Lione; Fay Sharpe; Fish & Richardson; Jones Day; Merchant & Gould; Morrison & Foerster; Ropes & Gray; Seyfarth Shaw; Weil, Gotshal & Manges; and Wilmer Cutler Pickering Hale and Dorr.

IP boutique firms are still important, the report said. But few of these pursue litigation work, and in-house counsel say they are happier when the same firm handles both prosecution and litigation for their company.

BTI’s research is based on unprompted feedback from more than 175 Fortune 1000 general counsel and IP decision-makers at top-spending organizations that represent more than 20 industries. Data was collected from Dec. 3, 2013, to June 10.