I beleive that Software as a Service is a growth industry in the legal field and that, as programs get more complicated and more expensive, more people will be moving to a SaaS model for at least some of their software needs.
A recent problem with Google Docs, however, highlights one of the potential problems with SaaS solutions: your documents are the in hands of someone else. ZD Net reported that Google admitted that .05% of its Google documents that were supposed to be private were treated as public.
Now, I have not heard any horror stories about how confidential information was exposed during this incident. However, this incident does highlight the fact that when choosing a SaaS provider or when choosing to place any of your documents in a remote location (typically over the internet), investigate your provider to make sure that they are taking adequate measures to protect your information and keep it confidential and to ensure that if something does happen, that they will act promptly to correct the problem.