The eDiscovery market in 2012 proved to be an interesting one to follow. While there were hot topics like The Cloud and technology-assisted review (TAR) and predictive coding commanding major headlines, there were also signs of real progress in our industry. Companies began to ask the right questions about storing data in The Cloud. What are the discovery obligations? Who controls the data? How secure is the data?
Case law around predictive coding evolved and, as a result, more and more organizations began experimenting with the practice. Companies began to take information governance (IG) seriously, though still lack in executing on projects. For example, while over 60% of the respondents to our IG survey have documented legal hold processes, less than half actually track those processes. Still, though, companies are beginning to take IG seriously, with more than half of the respondents to our defensible deletion survey indicating actual deletion is happening.
At the beginning of each year, eDJ Group makes predictions on what we think will happen in the eDiscovery market. How did eDJ do in predicting how the year 2012 would play out in eDiscovery? Following are the trends eDJ forecast for 2012 with commentary on how close those forecasts were to reality:
Trend #1: Continued growth of The Cloud for Information Governance and eDiscovery, but at a slow burn. There is no stopping the freight train that is the Cloud, but legal, privacy, security, and control issues will force some to apply the breaks a bit. While many applications like a CRM can move quickly to the Cloud without impediment, legal and discovery concerns are enough to force companies to think twice before completely moving information management to the Cloud. In eDJ’s eDiscovery and The Cloud survey earlier this Fall, half of all respondents were either somewhat or very concerned about eDiscovery of information stored in the cloud. eDJ will expose some of the issues with proactive information storage in the Cloud and SaaS-based eDiscovery in the Cloud. We will offer best practices and pragmatic ways to avoid some of the pitfalls that could await. The Cloud will continue to change cost dynamics of the industry. eDJ will be there to cover changing pricing models and market dynamics that can affect decision making.
How did we do?
We feel we nailed this prediction. Interested in The Cloud and SaaS eDiscovery offerings remains very high, but organizations have proceeded with caution. Instead of relying on The Cloud as some kind of savior, companies realize the need to define eDiscovery requirements upfront and move to The Cloud with caution. As always, costs are paramount in eDiscovery, and vendors that provide Cloud-based processing are simply able to achieve economies of scale, so we expect that eDiscovery will continue to inch closer to The Cloud, but on-premise solutions will remain important.
Trend #2: Continued evolution from processing applications to ECA to eDiscovery platform. It is likely that LTNY 2012 will feature the vast majority of software vendors touting an eDiscovery platform that can handle all or most of the eDiscovery lifecycle. In 2012, however, more vendors than ever will be able to offer compelling, integrated platforms. Gone are the days that any organization will buy just a simple processing engine. Rather, processing applications must evolve to add collection & preservation, analysis, review, and even some level of production in order to provide compelling ECA.
How did we do?
While we can realistically say that we have seen the end of tools that only do processing, we over-reached on this one a bit. Processing engines have given way to full-fledged ECA applications. Many vendors are bolting upstream (litigation hold) and/or downstream (review and production) components onto ECA applications, but that does not mean that true eDiscovery platforms have emerged and gained traction. When we use the term eDiscovery platform, we do so to cover the full eDiscovery lifecycle from identification through production. Instead of buying eDiscovery platforms simply because it checks all the feature boxes, customers do eDiscovery software analysis to see which vendors provide best-of-breed solutions to the specific project at hand. Such projects tend to be focused on a specific portion of the eDiscovery lifecycle, such as Preservation and Legal Hold Management, Processing/ECA, Review/Production, Technology-Assisted Review, or mobile device discovery. What is important is that customers be able to solve the problems they face immediately. In reality, very few vendors could claim a compelling end-to-end eDiscovery platform, so looking at best-of-breed solutions makes more sense. Certainly, buyers should analyze a vendor’s long-term strategy ― looking at partnerships and roadmaps to address features not addressed today ― and make sure that the vendor can fit into longer-term plans.
rend #3: The emergence of Information Management platforms. Large enterprises face huge challenges dealing with Big Data. Big Data covers both structured data (e.g. that in ERP systems) and unstructured content (e.g. files stored in SharePoint). Companies need to leverage all information for strategic advantage while ensuring they know what they have, where it is, how to get it, and how to quickly discern what it means for eDiscovery purposes. How can the information management platform impact eDiscovery? Well, in the minds of corporate practitioners, preservation “in-place” would be the panacea for many of their preservation headaches. An information management platform could potentially deliver such preservation benefits. We already see many large software vendors positioning to be the huge information management platform (e.g. HP/Autonomy, IBM, Microsoft, Oracle, and HP). IG and eDiscovery capabilities will be critical components of the information management platform. Currently, there is no vendor capable of delivering a full platform, nor are any companies ready to deploy such a platform across the enterprise. Rather, 2012 will be the year we begin seeing the vendors jockey for position.
How did we do?
Admittedly, we missed the ball on this prediction. While it is true that larger vendors do offer platforms for information management, few companies actually leverage those platforms for all functionality ― let alone to be more proactive about eDiscovery. The fact is that IG maturity is simply too low to be able to effectively leverage something as broad as an information management platform. It is hard enough to take full advantage of an eDiscovery platform, let alone something with much more functionality. We believe that the market will continue to head in the direction of these larger platforms, but the evolution will be slow. It is doubtful that any organization will ever get to a truly centralized information management infrastructure. By the time that evolution occurs, there will likely be some other paradigm shift in how we create and use information anyhow (much like how the Internet changed the way we work). That will throw another monkey wrench into eDiscovery and IG. But, that is years down the road. We believe that that this evolution to a broader information management platform will slowly continue, but will not be a huge driver of mergers / acquisitions in the next year or so.
Trend #4: More action on industry certifications. In 2011, eDiscovery certification and education was supposed to be big. That was something of a letdown. While many professionals take classes and gain certifications, no “industry standard” certification has arisen and there are several options for eDiscovery education. Professionals are not quite sure where to turn. There are a lot of interesting opportunities here ― in an emerging industry like eDiscovery, it is very helpful to one’s career to have certifications to put on a resume. eDJ will research the available options for certifications and education, including the business models of the organizations offering education. We will talk with those that currently have certification and learn how it has helped careers. eDJ will also investigate any plans that accredited organizations like the ABA have in terms of offering eDiscovery education and/or certification.
How did we do?
There was certainly a high level of interest in certification and training. Our survey results showed that virtually all of the industry believes good training programs are necessary for the advancement of the industry. When it comes to certification, however, only 55% believe that it is necessary. What we learned is that no single certification has emerged as the go-to certification that guarantees job security and increased salary. Certifications do showcase intellectual curiosity and can be valuable, no question; but, there has not been a huge movement in eDiscovery certifications this year. The recognition that eDiscovery training and education are so important, though, indicate that 2013 could be a year for educational programs to gain more traction. This will be helpful as eDiscovery maturity grows and professionals need more granular and specific curricula.
Trend #5: Social media collection and preservation heats up. The usage of social media tools such as Twitter, FaceBook, and LinkedIn create collection and preservation challenges that are brand new. Just as companies kind of figured out how to handle email for eDiscovery, these new collaboration mechanisms come into play with diverse native formats and new types of metadata. This creates an opportunity for solution providers to bring innovative collection and preservation tools to the market. Watch for most vendors to message social media collection and preservation capabilities, but for best-of-breed vendors like Actiance, NextPage, SocialWare, and X1 Discovery to have the most advanced, defensible, and cost-effective solutions. Point solutions are often the most innovative ones because the vendors can concentrate all development efforts on specific types of content.
How did we do?
We feel good about this prediction. The topic of social media governance proved extremely popular, with our webinars getting great attendance and generating very good questions. In addition, case law has evolved to show that social media is discoverable (though not with overly broad requests). What is interesting is that most of the action around social media eDiscovery is focused on the reactive ― being able to collect and preserve social media when necessary. We have not seen a lot of proactive management or archiving of social media content. We believe this is because most organizations do not yet understand how employees are using for business and not ready to start creating digital landfills of social media; after all, few organizations have figured out how to manage email well. This is just the beginning for social media in eDiscovery ― the topic got hot in 2012 and will continue to be top of mind in 2013.
Trend #6: Predictive Coding goes mainstream. Many organizations experimented with predictive coding in 2011. Look for some interesting case studies to emerge that allow the legal community to feel more comfortable with the defensibility and accuracy of predictive coding. Also, look for some vendors to use other terminology ― like Technology Assisted Review (TAR)― so as not to invite legal pressure from Recommind (who patented their own predictive coding technology/process and tried unsuccessfully to trademark the term). Predictive coding will have its biggest impact in the ECA realm, as corporations and law firms use it for first-pass review. eDJ does not see predictive coding gaining widespread adoption as a replacement for linear review in 2012, though we are beginning to hear stories of this occurring.