Home or Away? New eDiscovery Collection Market Sizing and Pricing Considerations

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Editor’s Note: Given the changing environmental and economic conditions based on the outbreak and impact of the coronavirus disease 2019 (COVID-19), eDiscovery professionals are considering business revisions to their 2020 plans and also making or accelerating eDiscovery decisions supporting the collection, processing, and review of electronically stored information (ESI). One of the key home (onsite) and away (remote) decisions that business, legal, and IT professionals in the eDiscovery ecosystem are currently having to consider is how they plan for and execute the core eDiscovery task of collection in today’s new world. From adjusted market sizing to selected task pricing, the following update provides context and considerations that may be helpful for eDiscovery decision-makers as they consider the critical eDiscovery task of collection during 2020.

Revisions in Market Size: A New Estimate for the Task of Collection

In considering the relative costs of the three core eDiscovery tasks of collection, processing, and review, in 2020, the core task of collection is estimated to represent approximately 13% of total eDiscovery expenditures. While the coronavirus disease 2019 (COVID-19) appears to be having a substantial impact on the economics and execution of eDiscovery, it does not appear at this early juncture in the evaluation of its on-going impact to have significantly altered the task percentage estimates in 2020 for collection, processing, and review.
Chart 1 – eDiscovery Relative Core Task Expenditures – 2020 1 – eDiscovery Relative Core Task Expenditures – 2020
Initial estimates (November 2019) suggested the market size for the collection task of eDiscovery to be at $1.65B during 2020. Revised modeling estimates that take into consideration the legal landscape changes driven by the outbreak and impact of COVID-19 have reduced market size estimations for the collection task of eDiscovery by approximately 23%, with the revised working estimate now being $1.28B for 2020. The model takes into consideration the generally standard market growth in the first quarter of 2020 as well as adjustments to revenue estimates based on marketplace changes during the last three calendar quarters of 2020.
Chart 2 – eDiscovery Market for Collection – 2020 – Revision 2-eDiscovery-Market-for-Collection-2020-Revision
Initial market model estimates for 2020 (non-published) suggested that approximately 95% of collections would take place onsite, while almost 5% would be performed remotely. However, with the outbreak and impact of COVID-19 and the corresponding location-dependent travel and group aggregation restrictions, revised estimates for the percentage of collections conducted onsite has been reduced from 95% to 10% for 2020. Correspondingly, the estimated percentage of collections to be performed remotely in 2020 has increased from 5% to 90%.
Chart 3 – eDiscovery Relative Core Collection Task Expenditures – 2020 – Revision 3-eDiscovery-Relative-Core-Collection-Task-Expenditures-2020-Revision
When applying revised market model estimates for the percentage of collections conducted onsite or remotely to the revised collection revenue estimates for 2020, it appears that the remote collection market will increase from original market size projections of $0.08B to $0.8B. Additionally, the onsite collection market will decrease from original market size projections of $1.57B to $0.48B. The model also takes into consideration the generally standard remote collection to onsite collection percentage ratio in the first quarter of 2020 as well as adjustments of these percentages based on marketplace changes during the last three calendar quarters of 2020.
Chart 4 – eDiscovery Market for Onsite and Remote Collection – 2020 – Revision 4-eDiscovery-Market-for-Onsite-and-Remote-Collection-2020-Revision
These collection-centric market size revisions will undoubtedly be reviewed and considered in the development of annual eDiscovery Market Size Mashups by ComplexDiscovery. However, they may be beneficial for business, legal, and information technology professionals as they consider the increasing acceptance and market size trajectory for remote collections in the conduct of eDiscovery.

Collection Pricing Considerations in the Summer of 2020

While the eDiscovery ecosystem is still in the early stages of understanding how the pandemic will directly impact the economics of eDiscovery and specifically the pricing of core collection tasks, the following summer results of the semi-annual eDiscovery Pricing Survey* from ComplexDiscovery may be helpful for industry professionals seeing to better understand currently reported general pricing ranges regarding selected collection-centric eDiscovery tasks.

eDiscovery Collection Pricing Survey Responses (May 11-20, 2020)

n=105 Respondents What is the per hour cost for a collection by a forensic examiner?
  • Less than $250 per hour. 23.8% (Up from 18.8%)
  • Between $250 and $350 per hour. 61.0% (Down from 62.5%)
  • Greater than $350 per hour. 6.7% (Up from 2.5%)
  • Do not know. 8.6% (Down from 16.2%)

Chart 5 – Collection Pricing: Per Hour Cost by a Forensic Examiner 5-Collection-Pricing-Per-Hour-Cost-for-a-Collection-by-a-Forensic-Examiner
What is the per-device cost for a collection by a forensic examiner?
  • Less than $250 per device. 12.4% (Down from 12.5%)
  • Between $250 and $350 per device. 30.5% (Up from 16.2%)
  • Greater than $350 per device. 43.8% (Down from 51.3%)
  • Do not know. 13.3% (Down from 20.0%)

Chart 6 – Collection Pricing: Per Device Cost for a Collection by a Forensic Examiner 6-Collection-Pricing-Per-Device-Cost-for-a-Collection-by-a-Forensic-Examiner
What is the per hour cost for analysis and expert witness support by a forensic examiner?
  • Less than $350 per hour. 15.2% (Up from 15.0%)
  • Between $350 and $550 per hour. 62.9% (Up from 60.0%)
  • Greater than $550 per hour. 7.6% (Up from 5.0%)
  • Do not know. 14.3% (Down from 20.0%)

Chart 7 – Collection Pricing: Per Hour Cost for Analysis and Expert Witness Support by a Forensic Examiner 7-Collection-Pricing-Per-Hour-Cost-for-Analysis-and-Expert-Witness-Support-from-a-Forensic-Examiner
* The semi-annual eDiscovery Pricing Survey is designed to provide insight into eDiscovery pricing through the lens of 15 specific questions answered by legal, business, security, and information professionals operating in the eDiscovery ecosystem. The summer 2020 survey was open from May 11, 2020, until May 20, 2020, and had 105 respondents share their understanding of the pricing of eDiscovery services. Additional Reading Source: ComplexDiscovery
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Rob Robinson
Based in Austin, Texas, Rob is a technology marketer who has held senior leadership positions with multiple top-tier data and legal technology providers and writes regularly on technology and marketing topics on the ComplexDiscovery(.com) blog.

Rob holds a Certified E-Discovery Specialist (CEDS) designation from ACEDS, a Certificate of eDiscovery from the Electronic Discovery and Evidence Training Institute, and has held leadership roles (VP of Marketing, CMO, and COO) in legal technology organizations to include ONSITE3 (Acquired), Orange Legal Technologies (Acquired), CloudNine (Acquired LexisNexis eDiscovery Product Line), and currently with HaystackID (Acquired Envision Discovery, Inspired Review, and eTERA Consulting). Rob also has held leadership positions in technology-centric organizations to include Crossroads Systems (Director of Marketing – Storage Area Networking) and Compaq Computer Corporation (Product Marketing Manager – Deskpro and Prosignia Product Lines). A former US Army Captain and Helicopter Pilot (AH-1, OH-58, and UH-1), Rob is an alumnus and Distinguished Military Graduate of the University of Mississippi.

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