Gartner predicts an eDiscovery software market worth $1.2 billion in 2010. More than 10% of that will be outside the US. Software suppliers may be ready to run with this, but where are the skilled people?
Gartner’s report of 16 December E-Discovery Software Marketplace is Set to Continue High-Growth Pace has inevitably interested the Twitterati today. Picture Shackleton glimpsing the South Georgia whaling station after his epic journey from Elephant Island; imagine a French Legionnaire seeing an oasis, a besieged wagon train catching the sound of the 7th Cavalry bugle or the defenders of Lucknow hearing Campbell’s relief column battling to lift the siege (I could go on for pages like this, but you get the picture – the end appears to be in sight).
Gartner foresees that worldwide eDiscovery software revenues will reach $1.2 billion in 2010, an increase of 23% over 2009. They point to “unplanned events” such as “litigation regarding bribery and corruption, foreign corrupt practices, securities and financial fraud, government contracting abuses, and healthcare fraud” as the main drivers for the growth which will, they say, bring market and technology consolidation, expansion of product and services portfolios and new customer bases. I have not read the report itself, but one can probably take it for granted that these conclusions are underpinned by Gartner’s usual research and analysis.
Apart from one not insignificant point, the industry looks in good shape to rise to the occasion: recession has been a spur to development in preservation and collection, in early case assessment tools, in search technology, and in ever more sophisticated review applications. There have been casualties, of course, both corporate and individual, but many providers will emerge leaner and ready to run. Some bright new stars have emerged, as so often happens in recession, when the giants can lose their way.
The shortage is of skilled people, as Socha and Gelbmann said in their last report. What is more, the skills needed now are not necessarily the ones we have – it is said of the British armed forces that they are always ready to fight the last war, and the same could be true of this new world, in which clients have learnt to flex their muscles, lawyers have yet to appreciate the implications of that, and technology suppliers try and work out where their marketplace is.
That latter aspect goes further than the realignment between in house and external lawyers, where Gartner’s point about “expansion of product and services portfolios” is not just about new inventions but about new ways of packaging the offerings to fit the new balance of power. The part which interests me is the reference to non-US growth. The relevant passage reads as follows:
Until now, vendor revenue for e-discovery has focused on the U.S., with approximately 90 percent of market revenue for 2008. However, going forward, market growth is also expected in common-law jurisdictions, such as Australia, Canada, South Africa and the U.K., as new civil litigation regulations are passed regarding privacy and disclosure. In addition, many organizations based in the U.S. have subsidiaries in countries around the world that will provide further pockets of regional growth.
So: if Gartner is right, the eDiscovery software market will be worth $1.2 billion and more than 10% of that will be in non-US jurisdictions. Although I am sure the full report covers them, Gartner’s summary does not even mention the EU, whose involvement in all this is presumably swept up in the references to subsidiary companies and privacy, nor Hong Kong and Singapore.
Here in the UK we have the prospect of a new Practice Direction and E-Disclosure Questionnaire plus Lord Justice Jackson’s report due out in January. Earles v Barclays Bank Plc  EWHC 2500 (Mercantile) has put large corporations on notice that the courts’ tolerance of poor record-keeping is at an end. The expensive shambles of the Baby P case reminds the public sector, from ministers down to the drudges in local authorities, that the rules apply to them as well. Several countries in mainland EU have tightened their privacy controls in the last few months. Australia and Singapore have had new practice directions this year.
We have all that plus a much more critical corporate client-base. With some obvious exceptions, the clients have not yet got much further than screwing their lawyers’ fees down, but there is only so much blood in those stones and a more positive approach is foreseeable. The suppliers need to work out what that should be.
You may care to check that your passport is in date. Mine is.