In the first article in this series, we looked at the cost of individual e-discovery projects as they are outsourced. We explored the fact that hours spent on review consume at least 70 percent of a discovery budget and that use of advanced analytics provided a return on investment by saving on review. In the second article, we looked at costs for bringing e-discovery in house. We demonstrated that with staffing, software, training and infrastructure, in-house processing, review and production might cost about $1 million for a modest-sized capability.
The issue of bringing e-discovery in-house has gotten a lot of ink. But since litigation volumes vary from year to year and since in-house installation requires fixed cost and stable staffing, many departments have looked away from it as a cost-saver for e-discovery. Instead, many are making sense of a blended approach using managed services.
How About Hybrid?
For others with larger caseloads, more technology needs and more of their own trained “hands-on” staff, e-discovery managed services may take the form of a cloud-based e-discovery service. With this, counsel rely on the service provider’s economies of scale for large infrastructure, robust bandwidth and 24 hour support to outside counsel. But general counsel’s own e-discovery staff set up projects and manage them, often on dedicated hardware and with software of the department’s own choosing. Advantages to this model are lower annual outsourcing fees (because they include less outsourced staffing) and storage rates that are closer to cloud-based commercial storage.