Like a bad Hollywood thriller, law firm technology has a villain that’s all too easy to spot. The economic downturn has–to no one’s surprise–taken a toll on the coffers of law firm IT departments: Fully one-third of the 110 Am Law 200 firms participating in our fourteenth annual survey of technology directors reported that their capital budgets were down more than 10 percent this year. Staffing levels and salaries have taken hits, and equipment purchases and software upgrades have been put off. None of it is happy news. (Access all the charts in our survey from the links below.)

“When I proposed a budget similar to last year, it was clearly communicated [by the firm's technology committee] that it went beyond what the firm wanted to spend on the capital side, by 30-40 percent,” says a law firm technology director who asked not to be identified. “So we had to go back and ask ourselves what we could live without for another year. We might get better performance on [Microsoft] Exchange 2007, but we were going to stay on Exchange 2003. We weren’t going to spend money on new BlackBerrys. We made conscious choices not to do certain things.”

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