Monthly Archives: January 2024

One of my favorite independent search market analysts (Stephen E. Arnold) found a blog by CB Insights Research listing recent Artificial Intelligence start-ups acquired by our favorite tech giants. Perfect timing for my presentation on 2016 eDiscovery Market Trends for Ipro Innovations next week. Only Nexidia’s $135M acquisition came directly from the eDiscovery market. Many of the acquisition targets specialized in analysis of images, video, social media or voice content. I have marked all of those with Natural Language Processing (NLP) or predictive analytics (i.e. more relevant to eDiscovery providers shopping for a CAAT alternative) on CB Insights timeline. I have to say that it is nice to see a market analyst company with an approachable pricing/content model.

So the complete quote from David C. Shonka, acting FTC GC, goes something like, “If you are going to ask for plutonium, don’t tell me that you cannot afford the containment system.” To be clear, all of Mr. Shonka’s remarks during the Sedona Conference session tracks at Ipro Innovations were made on his own behalf and not FTC policy. This particularly fabulous quote was in response to my question about the burden of effective security on solo or small firm plaintiffs for large electronic productions containing personal or confidential information. My take away is that proportionality, reasonableness and other factors do not waive counsel’s primary ethical responsibility to safeguard their client’s data or opposing productions. In the days of bates stamped boxes of paper, law offices and providers with man-trap hallways gave clients the illusion of security. Cloud email, mobile review, BYOD and demands for instant online access to massive ESI collections require a more formal diligence to secure and transport ESI. No wonder that some eDiscovery providers have begun to add security consulting and breach response to their offerings. The bottom line is if you ask for it, you have to be ready to provide reasonable protection for your ESI. More conference notes and perspectives after I have done my session on eDiscovery market trends.

Innovations 2016 was the best attended (450+) Ipro user conference to date. The addition of the Sedona Conference CLE sessions expanded the educational content. Overall, CEO Kim Taylor continues the slow conversion of diverse Ipro products into a centralized eDiscovery platform. If you have not kept up with the evolution, you can now buy the ADD processing thru production from Ipro channel providers, on-premise software and cloud IaaS. Last year, Ipro’s automated workflow and integration with Relativity took center stage. kCura’s recent acquisition of Content Analyst has forced Ipro to consider other analytics engines to power Eclipse visualizations and TAR. Healthy competition is good for our clients and the industry as a whole, so I will be interested to see which analytics engine starts to displace CAAT OEM customers. Below are my ad hoc notes from the keynotes and various sessions:

At LTNY several providers asked me cryptic questions and dropped ‘rumors’ that kCura was going to ‘pull a Clearwell’ by undercutting their channel partners. Although I am now out of the market analyst biz, it taught me to always check the source when I smelled smoke. Sometimes you find a house on fire. Sometimes you find the BBQ party. The kCura team made all the right noises about their commitment to a healthy, happy channel and I don’t publish unsubstantiated rumors. At the kCura Spring Roadshow today, Andrew Sieja announced upcoming availability of RelativityOne, a SaaS version of the platform that was unveiled to partners at LTNY. The licensing options and details have yet to be disclosed, but I can see why any service provider who was already struggling with our quickly evolving market would get nervous when his customers could potentially host cases directly with kCura. What do I think:

Then I would like to hear about it. Several years back I conducted research on the impact and adoption of multi-matter functionality in review platforms that supported cross matter collections and review work product. I conducted 15 hour plus long interviews accompanied with a short survey. The research report gathered attention and I did a webinar sponsored by Catalyst that dove into the results. While wading through client matter costs on a recent ROI engagement, I was pleased to see law firm tech time charges for culling through prior collections, review and productions. I was happy to highlight how that savvy counsel saved my client time and money. It got me wondering whether smart consumers have up’ed their game in the last 2-3 years and are finally adopting a pro-active cross matter approach instead of the traditional reactive, fire-and-forget matter strategies. So take my Multi-Matter 2.0 survey and email me if you have a multi-matter success or disaster story to share.

OpenText is a traditional enterprise document management technology company that has struggled to bring practical analytics and automated categorization functionality to the corporate market. The acquisition of Recommind for $163M is very similar to Microsoft’s acquisition of Equivio back in 2014, but for a much lower revenue multiple. Recommind stopped releasing their revenue numbers when they brought CEO Steve King on board to refocus on cloud based SaaS services instead of direct enterprise sales. Given that OpenText is only predicting $70-80M in Recommind driven revenue in 2017, I am guessing that Recommind’s investors only recouped a 2x multiple. That is practically a fire sale level in Silicon Valley terms and reminds me of Symantec’s acquisition of Clearwell. The article mentions several recent departures of high visibility execs from Recommind preceding the acquisition, which is usually a bad sign. My blog last September reviewed Recommind’s revenue history and plateau. My main concern for customers with active matters hosted with Recommind in the Cloud is whether OpenText will continue to support the SaaS model. I will be watching their 2017 GTM materials carefully and you will undoubtedly get my unvarnished opinion.

Some time back, kCura enabled their service channel to essentially resell non-volume based enterprise ‘seats’ to customers on a subscription basis. This was the first crack in the traditional $/GB volume based consumption model outside of on-premise consumer purchase of the technology. Epiq’s Arq℠ is a productized example of a kCura channel partner reselling hosted Relativity as a managed service. Other kCura partners have similar formal or ad-hoc offerings with basic Relativity or with their own integrated reports, templates or other enhancements. Epiq just announced a ‘new’ version of Arq, which I hope incorporates the new interface released in Relativity 9.3. With kCura now directly selling Azure hosted Relativity to consumers as RelativityOne, it will be interesting to see how pricing stacks up when or if kCura makes the RelativityOne pricing model public. For any of you thinking that these SaaS versions of Relativity actually break the $/GB model, I am sorry to report that the monthly subscription rate still seems to be directly pegged to your total volume capacity on the system (based on recent RFP engagements). That is as close to pricing as I will get, but it seems to me that this must be related to kCura license fees as it cannot be attributed to Azure’s pennies/GB storage overhead.

As I was comparing the responses from my 2016 Multi-Matter eDiscovery Survey to the original 2013 survey responses, I found a surprising decline in consumer awareness and importance of multi-matter functionality. Given the very strong ROI from my 2013 interviews and case studies, I expected that corporate legal departments would demand cross case reporting and data management features to reduce custodian impact, reprocessing ESI and review errors. After consideration, I have a tentative theory that the hype cycle around SaaS platforms and PC-TAR has focused consumer attention on single matter efficiencies rather than overall eDiscovery management. Many of the new and established cloud review platforms have limited cross-case functionality. Providers such as Epiq, LDiscovery and Lighthouse have custom Relativity dashboards, reports and tools for customers, but my survey indicates that multi-matter functionality is not driving provider selection. It should make for a fun Bloomberg BNA webinar next week with Adam Barr (Catalyst) and Jaime Myers (Caterpillar). So join us for pain points and best practices of creating a true eDiscovery lifecycle next week.

So what lessons should C-suite officers take from the Hillary’s EmailGate? Whether you are or report to a CIO, AG, CCO or any other alphabet exec, you should realize that many or most of your board members and other key custodians under legal hold are using Gmail, Yahoo or even personal domain email and IM accounts to communicate with their peers and social network. Most of these communications, like our Sec. of State, will be purely personal and not contain anything relevant to regulations, active litigation, etc. After 25+ years of internal investigations, custodian interviews, regulatory requests and even congressional inquiries, I can assure you that buried in that sea of golf tips, shopping lists, illicit love notes, grandbaby pics and more are unintentional stock tips, early earnings numbers and worse. Life and network is just different at the top of the corporate feeding chain. Too many execs making 7+ figures do not believe that the rules apply to them. What is worse is the proven fact that they are right.

Ever wonder what happened to your favorite local or even national vendor? Last week’s rebranding announcement of UBIC/Evolve/TechLaw to FRONTEO forced me to do some overdue maintenance on the eDJ Matrix and got me thinking of brands. We all know that the eDiscovery market is slowly consolidating as it matures. Just watching DTI gobbling up regional shops like pac-man reinforces the “Join, or Die” message that I have blogged on far too many times. A couple quick searches and database checks revealed that most brands disappear in full mergers or acquisitions such as the formation of Omnivere or Consilio. So the FRONTEO rebranding is almost a hybrid merger/branding exercise. TCDI just renamed themselves CVFox and CSDisco is now just DISCO. As our market matures and providers try to differentiate themselves from every other Relativity partner, I expect to see more companies shed older generic name elements such as documents, solutions, services, copy and even discovery.