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eDiscovery Bubble

I wrote that “eDiscovery is doomed” the last time.  I am not excited to write this, but let me go more in-depth here.  I have posted a presentation on this, for those that like slide decks, but the cliff notes are here:

  • Back in the day, Digital Forensics & eDiscovery were introduced to help level the playing field in lawsuits.
  • Today, Digital Forensics & eDiscovery are used as levers to make opponents squeal for mercy.
  • Since eDiscovery started, the costs have only gone up.
  • Today’s costs for Digital Forensics & eDiscovery are too high for clients to sustain.
  • There is a mad rush of people coming into the field from colleges and universities… even though there aren’t enough jobs for many who are already here.
  • Buyers of these services are still deeply uneducated about what is being provided.
  • A majority of vendors are not looking for ways to reduce costs, but instead looking for ways to shift costs.
  • Vulture Capital is swooping in to find the “next big thing”.
  • Companies, like Autonomy, are being bought way over priced.
  • Only the largest buyers can afford the services.
  • Vendors to “litigant losers” end up being paid 50 cents on the dollar (if they are lucky) for their services.
  • Oh, and litigation in the US is trending downward.

Isn’t this what happened in Real Estate, in Mortgage-Backed Securities, in the Dot-Com and Telecom Bubbles?  And don’t fall for the line that “it’s ok because litigation is picking up overseas.”  That is a skewered truth that will be disproven.  No other court system in the world is designed to handle as much litigation as the US and no other culture in the world will tolerate it.  Litigation (and eDiscovery sales) may grow for a short while, but it is going to plateau faster than most think, leaving many customers holding the short end of the stick.

Now that I’ve ranted, what do you think?

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