The End of eDiscovery Processing Fees

The discovery technologies industry, like any, is in a constant state of change. Each year, the subject matter at industry conferences bring a host of new “hot topics,” while providing a better understanding of old ones. What we like best about these conferences is being able to tighten up our view of where the industry is ... and where it may be going.

In the nearly 14 years InterLegis has attended these events, we’re always interested in learning how our competitors are pricing their technologies and services. Specifically, we’re most curious about what data/ESI processing providers charge for their platforms and services. Because, let’s face it, nothing downstream in the discovery life cycle can happen without the data first being processed. You can’t effectively understand the content of collections without being able to search, organize and analyze its processed data.

Without data processing, there would be nothing for legal teams to review. And therefore, there would be nothing useful to produce, unless you want to turn over all unfiltered collected data to opposing counsel. Nobody wants to do that. The processing of electronic data is essentially what kick-starts the core of discovery review.

Given its importance, this functionality has always needed to be paid for. And it can be quite expensive. Rates for this critical service range from up-front massive financial commitments, to per-seat licenses and per-gigabyte pricing ... often in addition to annual support fees.

THE COST OF OUTSOURCING

Through the years, we’ve seen outsourced eDiscovery processing priced as high as $4,000 per gigabyte for all collected data. And we’ve seen software installation fees range from six figure up-front commitments to thousands per machine. On one hand, per-gigabyte fees are a great way to pay on a case/client basis. Except for one thing. Nearly all pricing models out there ask you to pay at the “top-of-the-funnel” -- or for 100% of the collected data coming into the processing stage. Given that upwards of 95% of this data can be eliminated before the review stage (via keyword/attribute culling or early case assessment tools), you’re always paying for data that reviewers will never see.

So, the big question is: “Why would you do that?” It’s like paying to fill up your car’s gas tank, when you know beforehand that you’re only going to need to drive a couple of miles before you get rid of the vehicle! Except in the case of eDiscovery, the wasted expense is much more significant. When you look at it that way, it seems like a waste, doesn’t it?

To combat this, software and service providers might get creative and charge you a smaller fee on the incoming data (top-of-the-funnel) and a larger fee on the way out (bottom-of-the-funnel). This two-tiered pricing model is positioned as a way to reduce your costs. But with this model, you are not only paying twice for the same data, you’re still paying for data you don’t need. And truth be known, when the invoice arrives for a two-tier pricing model, you’ll often find yourself only saving a small percentage of the costs compared to the top-of-the-funnel model. That’s not nearly a significant enough reduction in costs.

THE COST OF INSOURCING

The only other option you have is to buy the software outright and bring it in-house. Going back to the changing nature of the industry mentioned above, this used to be pretty much out of the question unless you were a litigation support company. Corporate and law firm legal teams would normally outsource their eDiscovery work. However, thanks to the increased sophistication and knowledge over the years of those who work in discovery, bringing these technologies in-house has become extremely prevalent. But from a cost perspective, this model typically requires you to make significant investments up-front to install this technology across your enterprise before a single document is processed.

THE PRICING PITFALL

This identifies two big problems associated with nearly all software pricing platforms and service models:

• Installation Fees: You will spend a significant amount of money to buy capacity, without processing a single electronic file. And this issue is compounded if you need to bill processing charges on a case or client basis. How do you effectively amortize your up-front investments across future matters?

and/or (most likely “and”) ...

• Paying for Data You Don’t Need: You almost always end up paying for irrelevant/unresponsive data. For example, why must you pay to process collected Fantasy Football emails when all you care about is the correspondence related to the issues of the matter at hand?

When analyzed this way, it makes no sense. And through the years, the pricing models always seem to change, but the two problems above are always at play.

THE ANSWER

So what’s the answer? No matter what software service is used or what pricing models are offered, there’s only one solution to these two problems. The answer is: DON’T PAY FOR ESI PROCESSING OR SOFTWARE INSTALLATION FEES. Period. It doesn’t get any simpler than that.

But is it possible to avoid massive up-front installation fees and pay for only what you need? The answer is YES!

InterLegis’ Discovery360 does not charge for software or data processing. Also, it provides the flexibility of hosting your data on either your servers or ours on a case-by-case basis.

Here are those two issues again. Except this time, let’s point out the benefits Discovery360 delivers for each:

• Installation Fees: Discovery360 can be installed for free -- on as many laptops, desktops and servers as needed. It can be installed on every computer being used by litigation support teams, attorneys, and reviewers. And it can be custom-installed across your network. This allows you to create whatever capacity you need, whether that be 200 gigabyte or 10 terabytes. No machine fees. No user fees. And if you want the best of both worlds, you can use the same software to host your data locally or on our servers -- on a case-by-case basis. With Discovery360, you can build a powerful enterprise-wide discovery processing solution without paying a dime.

• Paying for Data You Don’t Need: Once installed, you can load as much data as needed, process 100% of it, cull it down to what’s responsive, and generate reports on every step of the process ... all for free. Once you’ve determined the data you need, you are charged a small fee for only your selected data. But the benefits continue after this one-time fee. Once you’ve paid that all-inclusive fee, you get full use of our Reviewer platform, including all user access, custom index fields, reporting ... and all productions in either TIFF or native file format. Or, if you like, you can export your culled data to an industry-standard load file format for use in another review tool.

Problems solved.

There’s a great deal of talk, articles and blog content out there discussing various strategies designed to reduce discovery costs. But no matter how creative the solutions are, there’s only one surefire way to significantly accomplish this goal. And that is to eliminate many of the costs associated with the discovery life cycle ... especially data processing. Again, it just doesn’t get any more simple than that.

Visit www.InterLegis.com today to request your free download of Discovery360. And start performing discovery, the way it should be.