The runaway success of the Internet service provider Freeserve, launched on 23 September 1998, but now estimated at being worth up to £2 billion, is proof of the accelerating significance of the Internet as a commercial tool.

Many law firms are now 'Net literate'.However, there is enormous disparity between the extent to which firms and individual lawyers have grasped the importance of the Internet and how it can be used to enhance business.

But the gulf between those for whom the Internet is an unwelcome imposition and those who embrace it reflects neither law firm size or practice area.

Innovation has come as much from the ranks of high street practitioners with an interest in IT as much as it has from the large commercial firms.Of course, the requirements of a corporate City practice differ from those of a high street practitioner.

But the potential of a Web site -- as an extension of a brochure or a means of delivering service -- is repeatedly being ignored by both.Perhaps the most sophisticated use of the Internet by a UK law firm is by Linklaters & Paines, which launched its Blue Flag product nearly three years ago.

Blue Flag is a specialist tool.

It is a financial markets product which aims to help financial institutions -- banks, brokers, and investment fund managers -- navigate regulatory and compliance issues world-wide.Paul Nelson, Linklaters's head of financial markets and responsible for developing Blue Flag, says the approach can be adopted for any advisory area of law, in effect providing clients with a product which is a 'virtual lawyer'.No other firm has, to date, initiated a similar product.

However, national firm Hammond Suddards has recently launched Hammonds Direct, a service which allows the firm not only to give its clients advice via the Internet, but which also allows clients immediate access to their files and thus the ability to check on the progress of work the firm has undertaken.Luciano Dammone, the lawyer responsible for Hammonds Direct, says that many firms are reluctant to make the considerable investment that such an undertaking requires.

He says: 'The legal profession as a whole doesn't spend enough money on IT, and IT companies don't see the legal profession as a moneyspinner in comparison to other industries.

An obvious example [of a comparable industry] is the financial services industry'.Mr Dammone says that even the biggest City firms are not regarded by IT professionals as the best target for their attentions.

'They don't invest on the same scale, and there isn't the repeat business,' he says.Mr Dammone says that having made noises about willingness to use the Internet, firms often take a lackadaisical approach to putting the two together.

Hammond Suddards spent more than two years and £1 million developing Hammonds Direct.

'You've got to put your money where your mouth is, and it's got to come from the top down,' he says.

'It's not enough to put the project in the hands of one or two "techie" partners.

It's not enough to play at it.

You've got to nail down what you want from the Internet in terms of tangible business benefit, and distinguish between something that's nice to have and something that delivers.'Hammonds Direct is tailored to helping institutional clients involved in largely corporate transactions.

The system incorporates a sophisticated telephone and call centre which works in tandem with the Internet service provision.At the other end of the spectrum, Michael Kaye from two-partner London law firm Kaye Tesler, has spent considerable time developing Internet software that enables him to advise existing and potential clients on the Internet -- largely regarding probate-related matters.

'I have a typical suburban practice', says Mr Kaye, 'advising the bus driver, the postman and the shopkeeper.'Mr Kaye says that on average he draws up three wills a month.

He can also obtain a grant under probate at the price of £185 for an estate valued less than £200,000.These services, he points out, 'are still the result of questioning by a solicitor, and still drawn up by a solicitor', and is both profitable to the firm, and cheap for the client.

Obtaining a grant under probate involves between 15 and 20 minutes work, which works out at a pro rata hourly billing of nearly £500.Mr Kaye says that his Internet presence has also resulted in a number of instructions from abroad, largely received from expatriots, something he says he 'never expected to happen'.

Mr Kaye now produces software packages for solicitors wishing to offer a similar service.Joe Reevy edits Law Zone, an email-disseminated weekly magazine for lawyers, with an IT focus.

The magazine is produced by SIFT, an organisation devoted to creating industry specific 'virtual' communities.The company is on the cusp of launching a similar service for lawyers.

Mr Reevy says that 'lawyers are convinced that the law is unique', and that as a consequence they do not approach IT matters systematically.

'The Internet presence of law firms often reflects confusion regarding IT within the partnership.'Consistently, observes Mr Reevy, law firms disregard some basic rules that could elevate their Web sites from amateurish excursions into cyberspace to being an integrated part of their overall strategies.

'The first thing to consider', says Mr Reevy, 'is how you intend to differentiate yourself from the competition.'Examples of this that he knows of include a midlands firm which specialises in family law that includes the home telephone numbers of its lawyers, a personal injury firm specialising in motorcycle accidents that displays damages won for its clients, and a high street firm in Devon that uses the Web to proclaim that one of its lawyers speaks fluent Swedish and another Turkish.Law firms must recognise, warns Mr Reevy, that soon they will see that they are investing in the Internet not just to make more money, but to stay in the business.