You don’t need Gartner to tell you that the e-Discovery marketplace is volatile and overcrowded, with new vendors entering as others merge. But it did anyway. In its first Magic Quadrant for e-Discovery Software report, Gartner apprises us of the challenges, trends and prospects for the e-Discovery industry.
In its report, Gartner says that there are two key factors inspiring growth within eDiscovery: An increase in civil litigation, criminal prosecutions and regulatory oversight; and the need for associated communications to be preserved for discovery. Combined, these two drivers lead Gartner to forecast a five-year compound annual growth rate (CAGR) of approximately 14%, which means the total should reach $1.5 billion in 2013. Not too shabby.
Magic Quadrant: What It is, How It Works
This Magic Quadrant for e-Discovery aims to help CIOs, general counsel, IT professionals, attorneys, compliance staff and legal service providers understand the dynamics and landscape of the market for e-Discovery software.
To be included in this Magic Quadrant, a vendor must sell enterprise software licenses, a software appliance, or SaaS conforming to Gartner’s definition of SaaS. As well, vendors must also address at least one of three broad functional areas, relating to the EDRM, that Gartner chose to reflect the overlapping wants and needs of e-Discovery users, including left and right sides of the EDRM model, and information management. Vendors with end-to-end EDRM processes are also included.
Generally speaking, each qualifying vendor was evaluated for a plethora of offerings. From customer experience to sales and pricing to product service and track record, the results are plotted across quadrants, where the x-axis represent the completeness of the vision, while the y-axis represents an ability to execute. In the end, vendors fit into four personas: Challengers, Leaders, Visionaries and Niche Players.
Leaders demonstrate an ability to understand the overall market’s direction and have anticipated it correctly. As a result, their software not only meet the needs of enterprise customers and are easy to use, but also include an ability to perform litigation holds, collection of data with metadata preservation, connectors to email, email archiving, file shares and Microsoft SharePoint.
To be qualified as a leader, a company doesn’t necessarily have to boast a platform or a full suite of e-Discovery offerings. The leaders in this year’s Magic Quadrant are Autonomy, Clearwell Systems, FTI Technology, Guidance Software and kCura.
According to Gartner, challengers score strongly for their ability to execute, but may need to invest more to grow. Companies listed as challengers include: EMC/Kazeon, IBM, Nuix and Symantec.
It’s not hard to have a vision, so there are many companies included within this category. Unlike challengers, visionaries often introduce new technology, services and business models, but they may need to improve their financial strength, service and support and build sales and distribution channels. The likelihood of them becoming challengers or leaders depends on how well they can execute these new technologies.
Visionaries featured in the Magic Quadrant include AccessData Group, CaseCentral and Catalyst Repository Systems, CommVault, Exterro, Recommind and Zylab.
As in most industries, a niche player may fit your requirements perfectly, even if they are not representative of others’ needs. Gartner identied Daegis, Epiq Systems, Integreon, Iron Mountain, Kroll Ontrack and Xerox Litigation Services as niche players because they fill a void and solve specific problems for a specific industry, such as offering processing, review and analysis for law firms or service providers.
The biggest challenges for vendors in the niche players quadrant are remaining cost-effective and providing terms and conditions favorable within the enterprise.
Why Does the Magic Quadrant for e-Discovery Matter?
Because it is the first of its kind to address and evaluate e-Discovery, it may not be entirely clear how this report can affect the marketplace. While we’ve been talking about e-Discovery for years, it has only begun to reach its tipping point within the enterprise. Perched at the intersection of new media and compliance, the need for all electronically stored information to be archived for proof of compliance becomes relevant for every company, of every size, pushing e-Discovery solutions to the forefront.
The Magic Quadrant aims to help companies pick the best solution for their needs, while it allows vendors to position themselves in the right space. If aligned correctly, it will help streamline the decision process.