Forrester Research says that the North American eDiscovery market will grow to almost $4.89 billion by 2011. That's a massive increase over 2006 when it was $1.45 billion. So why wouldn't ECM vendors want a piece of that pie?
Interwoven had decided to get its piece of the eDiscovery pie through the acquisition of on-demand e-discovery provider Discovery Mining Inc.
All About the Acquisition
Interwoven has reported that it will pay roughly $36 million in cash in return for all outstanding shares and vested stock options, including assuming certain existing employee stock options.
Discovery Mining, a six year veteran of e-discovery, provides professional services firms and corporations with a SaaS solution for "processing, reviewing and producing massive volumes of electronic data." They provide services for accelerated review such as concept searching, clustering, analytics and email filtering.
In a conference call with analysts and journalists, Interwoven CEO Joe Cowan said, "Being able to handle and process hundreds or thousands of documents is a monumental job. These people [Discovery Mining] have figured out how to automate all of that. Their solution is unlike anybody else's on the market."
Discovery Mining was ranked by law firms in the top five of the 2008 Socha-Gelbmann Electronic Discovery Survey and was named by Inc. Magazine as one of the 500 fastest growing companies in 2007. All this, along with a number of high profile law clients, would certainly have caught Interwoven's attention when they went looking for an e-discovery provider to add to their portfolio.
According to Cowan, "...eDiscovery has become an absolutely vital – yet challenging – component of the litigation process. We look forward to adding Discovery Mining’s innovative eDiscovery service to our set of market-leading solutions we offer to over 1,700 organizations around the world. We plan to leverage our market experience to bring leadership to what is today a fragmented market for eDiscovery.”
In an FAQ section on Discovery Mining's site, they say joining Interwoven is a good thing for them, "Discovery Mining gains access to the extensive engineering, marketing, and sales resources of the global leader for information management solutions for legal and accounting firms." They also say that nothing will change for existing clients in terms of account managers and services.
ECMs Vie for the eDiscovery Market
Interwoven isn't the only one trying to get deeper into e-discovery. In April, HP acquired Tower Software specifically to provide deeper capabilities for managing e-discovery and compliance. Even EMC Documentum and Oracle have announced plans for a stronger information compliance platform.
It will be interesting see who provides the strongest eDiscovery services going forward as they become a much more important part of enterprise content management.
The acquisition is expected to be completed by third quarter 2008.