On the heels of a Symantec report on e-Discovery and information retention, market trends in the e-Discovery industry are improving after dropping sharply (along with everything else) in 2009, according to a report from IBISWorld.
According to the E-Discovery Service Providers Report, despite losses in corporate profitability amid the economic recession, revenue in the e-Discovery industry has grown at an average annual rate of 5.6% to an estimated US$ 786.5 million in 2011.
Consequently, because corporate profit is slated to grow at an average annual rate of 7.3% over the five years to 2016, IBISWorld says it anticipates this turnaround to drive e-Discovery revenue up at an average annual rate of 6.1%, to reach US$ 1.1 billion by the end of 2016.
Market drivers include the increasing amount of electronically stored information (ESI) and growing demand from the legal market. In addition, corporations cite social networks as a significant source of information, and the growing influence of these websites within the work environment will spur demand for new and advanced e-Discovery products, IBISWorld says.
All this is happening amid a decrease in the actual number of vendors in the market. Such moves as Symantec acquiring Clearwell and Hewlett-Packard acquiring Autonomy signal an industry-wide trend that has pushed the number of firms down at an estimated average annual rate of 2.0% over the five years to 2011, to 612 businesses, IBISWorld says.
Also, recall that Gartner predicted earlier this year that acquisitions would reduce the number of e-Discovery vendors by 2014. Gartner was also more bullish on the industry in general, predicting revenues of US$ 1.5 billion by 2013, though IBISWorld also shows a decrease in revenue after that point.
Of the vendors, Autonomy holds a 12.2% market share, while Symantec holds 7.9%, IBISWorld says.
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