Evidence of Maturation in eDiscovery Market?

Migrated from eDJGroupInc.com. Author: Barry Murphy. Published: 2010-10-05 13:19:31  The Cowen Group recently put out some very interesting research showing that 87 of the AmLaw 200 law firms have eDiscovery practice groups.  The next step in Cowen’s research is to look more granularly at what those groups are doing, investments those groups are making in technology and people, and the level of authority and traction the groups get within the firms.  I think this statistic points to the beginning of some maturation in the eDiscovery practice realm.  While one might say that the real sign of maturation will be that close to half of Fortune 1000 companies have eDiscovery practice groups, it is really the law firms where this trend should begin.Corporate legal departments find themselves in a tricky place – they have to sign off on retention policies, determine the reasonableness of eDiscovery efforts, and stand to take the blame down the road if they fall short in the job.  It’s logical for them to rely on the advice of external experts – the law firm.  Even though law firms could potentially have some business model conflicts (they do bill hourly and make money the more work they do for clients), they also have experience with eDiscovery across multiple clients.  And, the litigation support managers at law firms have experience with multiple technologies.  As we pointed out in our article on the marriage of software and services, there are law firms that are beginning to provide EDD processing services to clients and are building out a technology infrastructure to support that business.  Many of the vendors I speak with see the law firms as a sort of channel; if the law firms like the technology, they can recommend it to clients for use during in-house activities.  From the law firm perspective, having clients use the same tools for eDiscovery can make the transfer of data less complex.Certainly, the proof will be in the next round of The Cowen Group’s research.  The mere existence of an eDiscovery practice group is not evidence of market maturation.  However, if these groups are investing in tools and people, experimenting with new technology, and creating services that the law firm can sell to clients, then I will take that as the sign of a clear trend that eDiscovery is growing up, at least a little bit.  I’d also start to look for corporations to create similar practice groups down the road, or to rely heavily on the consulting services that the law firm practice groups can provide.