Next Generation, Less Expensive and More Powerful eDiscovery Platform

GlobalDiscoveryNetworkIn the process of reviewing the market requirements for next generation, less expensive and more powerful eDiscovery platforms, I came across and excellent and thought provoking article titled, “A call to vendors to make e-discovery affordable for ‘The Other 85 Percent’,” posted on the ACEDS site by Christine Taylor.

Christine states that, “Complex eDiscovery products, according to various industry estimates, only serve 15% of the litigation and GRC (Governance, Risk, Compliance) markets.”     Christine goes on to state that, “This intense focus on eDiscovery for the 15% means that that 85% of mainstream eDiscovery goes begging. The dearth of workable and affordable tools impacts solo practitioners, small law firms and even the distributed branches of large law firms. These legal professionals do not need complex (and expensive) eDiscovery platforms but they do need the technology help.”

I agree with Christine’s assertion that solo practitioners, small law firms and even satellite offices of larger law firms don’t necessarily need complex solutions and are left with no financially viable options.

I also like her wish list which includes:

  • Efficient eDiscovery on small matters. Entry-level e-discovery tools for the mainstream should easily support a typical small case: Windows applications, under five custodians and about 100,000 documents. The product should enable search and review with notations for relevance, privilege, and more. The tool should also create common production load files, images, documents or print if needed.
  • Economic pricing and simple to use. Purchase price is not the only consideration for e-discovery: learning complex new software adds dramatically to the product cost. A feature-rich and simple e-discovery product with a low price tag is an ideal solution for the mainstream. Such a product supports the reality of most law firms: clients will not automatically accept costs and e-discovery is a periodic process that does not justify large money or training investments.
  • Scalable for larger matters. Sometimes small cases balloon into large cases or a law firm takes on more e-discovery matters than usual. In these cases, the scaling entry-level e-discovery product is an attractive option, as long as it remains economical and simple to use. E-discovery vendors who offer an entry-level product with a cost-effective upgrade path will have a foot up in the mainstream market place.

I would add another wish to the list for Litigation Service Providers and Consultants. This wish would state the need for a platform that didn’t require the provider or consultant to build out and maintain a data center and purchase expensive eDiscovery  software.

Further to this last wish, I would also add the wish for an eDiscovery / Information Governance platform that lent itself easily to a managed services models that enabled the litigation service providers and consultants to provide value added services remotely.

New Generation eDiscovery Solutions Already Exist

As recently state in my February 1, 2014 blog post titled, “Product Review of The Global Discovery Network from Global 7 Technologies,” there are Software-as-a-Service (SaaS) based eDiscovery / Information Governance platforms currently available that provide very affordable, easy to use and yet very scalable and powerful platforms to address the requirements of the market the Christine defines.

I would also contend that these new generation solutions built on the Big Data technology stacks and running in public clouds such as Amazon’s AWS , as an inevitable part of the technology market lifecycle, will eventually overtake the current crop of legacy eDiscovery / Information Governance platforms.   However, for now, they will provide a very viable alternative for solo practitioners, small law firms and even the distributed branches of large law firms. 

The full text of Christine Taylor’s article is as follows:

The majority of e-discovery software platforms are made for big-budget cases. They serve millions of files, multiple review teams, hundreds of custodians and ESI collection across acres of disk and tape storage – and they get the lion’s share of media attention

But I’ll let you in on a dirty big secret: complex e-discovery products, according to various industry estimates, only serve 15% of the litigation and GRC (Governance, Risk, Compliance) markets. Just 15%. Why such a small percentage? Because technology investors, especially venture capitalists, care about funding big projects with potentially big returns. These investors want to see their vendor products in large organizations and law firms, who routinely spend hundreds of thousands (even millions) of dollars on complex litigation and investigations.

This intense focus on e-discovery for the 15% means that that 85% of mainstream e-discovery goes begging. The dearth of workable and affordable tools impacts solo practitioners, small law firms and even the distributed branches of large law firms. These legal professionals do not need complex (and expensive) e-discovery platforms but they do need the technology help.

“Not having tools has been a problem,” Bruce Olson, trial attorney and President of ONLAW Trial Technologies, in Oshkosh, Wisconsin says. “A lot of lawyers have been sticking their heads in the sand and hoping that electronic discovery will go away. But so much information now exists in electronic form. You have to collect it electronically. Once you’ve collected it you want to review it electronically, and to produce it electronically in court. You need to know the whole EDRM model, you need those basic skills.”

A few years ago, these small firms performed e-discovery manually. But the e-discovery landscape is changing fast: rules are tightening and searchable data is growing. Modern e-discovery is fraught with the risks of irrelevant data, poor custodial practices, evidence spoliation, bloated processing costs, and expensive review.

The 85% of mainstream practitioners have as much responsibility to avoid these mistakes as the 15%. But the lack of affordable ediscovery tools leaves small law firms scrambling for less-than-attractive options, among them:

  • Per-GB charges. Charging a dollar rate per GB is a common practice and with small matters seems to be affordable. Sadly, a single desktop computer can account for up to 80GB all on its own. Processing costs build quickly at hundreds of dollars a GB and review is at least as expensive. The overall cost of the per-GB model easily hits tens of thousands of dollars in small matters, and hundreds of thousands of dollars should the matter grow.
  • Flat monthly hosting fees. A typical per-month fee can sound attractive if the vendor is charging $1 per page. However, often, the fee is for 1000 pages a month — $1,000 — whether or not the law firm uses the per-page ediscovery it paid for. There is no rollover since the vendor’s profit model depends on the $1000 payment a month. These fees are barely recoverable because the firms cannot accurately match the monthly flat fee to correct percentages of client use. Most law firms end up eating the licensing costs.

“The set-monthly billing guys have no idea how law firms work. I need detailed invoices about what I used and for whom,” David Steinfeld, a Florida Bar Board-Certified litigation attorney in West Palm Beach and a Litigation Counsel of America Fellow, says. “A $12,000 bill for the year isn’t going to work. There is no efficient mechanism for recovering costs with a monthly charge.”

  • E-discovery products made for the 15%. Some attorneys are attracted to the capabilities of the big e-discovery platforms and full-service consultancies. These platforms are attractive – for the large enterprise. With costs starting at $100,000, they are scarcely suitable for small matters and clients. Even mid-range e-discovery products of $15,000 to $40,000 have serious financial consequences. Will the client pick up or share the cost? They might if that $30,000 tool will save them enough money and time. But if a $3,000 tool will in fact do the same thing, then they had better hear both options.
  • Eat the cost of the above options or lose clients by passing high costs onto them. Recovering e-discovery purchase costs for small matters is a real problem when the tool costs $30,000. Presenting a range of e-discovery options to the client is one thing; simply assuming budget is not. Even an e-discovery purchase as an internal cost of doing business is a poor investment if the e-discovery projects are few and far between.
  • Cobble together an e-discovery process using free tools that may or may not work. Many law firms turn to free software in an effort to provide e-discovery at low cost. Some free tools can help with very simple collections. But the real usefulness of e-discovery tools is managing the workflow between e-discovery sub-processes, something a free tool will not do.

Olson agrees that some traditional ediscovery vendor pricing models are too expensive for the mainstream.

“Sometimes a small firm may have a case that is large enough for traditional e-discovery tools, but this is rare,” he says. “Generally, traditional pricing schemes are too expensive for solos. And most of these vendors don’t want these small cases anyway. You just can’t make any money on providing tools for small cases under 50,000 documents.”

E-discovery for the mainstream

There are better e-discovery options for attorneys who are willing to learn about e-discovery.

“I think it is mandatory for lawyers to understand e-discovery and to develop a level of comfort and competence in it,” Steinfeld says. “It will be increasingly important as time goes by to maintain a level of proficiency, both to service their clients and to stay competitive within the legal field. As part of that, knowing which e-discovery software to use will be very beneficial.”

A handful of technology service providers are developing tools that are simple to use and less expensive than the enterprise products. It is important for practitioners to seek out those platforms engineered to be efficient, effective and economical. The best of them also offer a scalable path for larger e-discovery cases.

A wish list for small firm and solo practitioners might look like this.

  • Efficient e-discovery on small matters. Entry-level e-discovery tools for the mainstream should easily support a typical small case: Windows applications, under five custodians and about 100,000 documents. The product should enable search and review with notations for relevance, privilege, and more. The tool should also create common production load files, images, documents or print if needed.
  • Economic pricing and simple to use. Purchase price is not the only consideration for e-discovery: learning complex new software adds dramatically to the product cost. A feature-rich and simple e-discovery product with a low price tag is an ideal solution for the mainstream. Such a product supports the reality of most law firms: clients will not automatically accept costs and e-discovery is a periodic process that does not justify large money or training investments.
  • Scalable for larger matters. Sometimes small cases balloon into large cases or a law firm takes on more e-discovery matters than usual. In these cases, the scaling entry-level e-discovery product is an attractive option, as long as it remains economical and simple to use. E-discovery vendors who offer an entry-level product with a cost-effective upgrade path will have a foot up in the mainstream market place.

Large cases may get vendor and press attention but every case is important to those involved in it. The entire market, not 15%, deserves to have accurate, affordable and timely e-discovery options.

About Charles Skamser
Charles Skamser is an internationally recognized technology sales, marketing and product management leader with over 25 years of experience in Information Governance, eDiscovery, Machine Learning, Computer Assisted Analytics, Cloud Computing, Big Data Analytics, IT Automation and ITOA. Charles is the founder and Senior Analyst for eDiscovery Solutions Group, a global provider of information management consulting, market intelligence and advisory services specializing in information governance, eDiscovery, Big Data analytics and cloud computing solutions. Previously, Charles served in various executive roles with disruptive technology start ups and well known industry technology providers. Charles is a prolific author and a regular speaker on the technology that the Global 2000 require to manage the accelerating increase in Electronically Stored Information (ESI). Charles holds a BA in Political Science and Economics from Macalester College.