I talked on Friday to FTI Technology’s Mike Kinnaman, to catch up with FTI’s view of the eDiscovery market in the coming year. FTI takes what you might call an evidence-based approach to prediction each year, asking Ari Kaplan to collect, aggregate and comment on the views and experiences of in-house counsel at the higher end of the eDiscovery market. That approach, Mike Kinnaman said, tells FTI where the market is going and “takes a bit of the fuzz off the crystal ball”.

Most of what emerged in 2011 is consistent with earlier trends and unsurprising: early case assessment as a process continues to be important as a way to get better control of cases and their costs; there is a sharp focus on the cost of the legal review; and the use of managed review services has remained consistent after a steady rise, appreciated not just for keeping costs down but for making them more predictable.

The biggest polarity of views, Mike Kinnaman said, comes up in respect of analytics, clustering and particularly predictive coding which arouses “great promise and healthy scepticism” in equal measure. It is seen as great for case assessment and for investigative scenarios, but lawyers and their clients remain “less and less comfortable as they get closer to production”. My own guess is that this will change early in 2012, but I don’t disagree with FTI’s conclusion as to the present position.

There was, he said, a stronger in-house awareness both of discovery obligations and of what is being spent on them. As to the latter, I observed that the recent survey by ESG suggested that a very large number of companies had little idea of their eDiscovery spend (blog posts here and here link to the survey). Mike Kinnaman said that FTI’s conclusion was not inconsistent with that – the participants in their study were at the extreme end and were generally people who had been through larger and more complex litigation. They have learnt from what happened last time and, unsurprisingly, are ahead of others in their determination to achieve greater transparency next time, in part through better metrics.

One specific point which had arisen was a clear trend towards the reduction in the number of providers used by any one company. Last time this question was asked, the average was around five; now it is down to 3 as clients seek greater control through fewer points of contact, better insight into what is going on, and more ability to negotiate economies of scale and other terms. This is not something which has emerged from other surveys and trend-spotters, but makes obvious sense, particularly as providers of both services and software are extending their range to right and left of their starting points on the EDRM.

FTI are also seeing more people with “eDiscovery” in their job title and senior people explicitly stating that eDiscovery is their responsibility.

FTI will be launching the results of the survey before LegalTech and will be discussing it on the second day, 1 January, when  FTI Technology’s Senior Managing Director Joe Looby, Ari Kaplan and senior legal people from DuPont, Dow Chemicals and Dell will be talking under the heading Advice from counsel at 10:30am.

My own FTI mission at LegalTech will be to find out more about developments in Ringtail 8, Attenex Patterns (still rightly shown as a free-standing software option, I am pleased to see) and about FTI’s software and services offering Acuity.

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