Legaltech, which takes place early every year in New York City, is the biggest trade show and conference covering the legal technology industry. In recent years, it has come to be dominated by eDiscovery vendors, and this year was no different—eDiscovery companies clearly made up the largest share of vendors crowding the exhibit halls at the Hilton and claimed many of the speaker slots. However, there were a number of new elements that set this year’s show apart somewhat, and all of those changes reflect current legal industry trends. Here is a handful of observations on this year’s event.
It’s still an eDiscovery Show
While a little more variety is creeping into a show that had been dominated by eDiscovery for many years, the eDiscovery vendors are still dominant. A long trail of companies in miscellaneous categories, with a few vendors in each, make up the rest.
Of a total of 194 exhibitors, I identified about one-third of them as being in the eDiscovery market as technology or service providers. Document management, data security, collaboration, cloud storage, and practice management were some of the other top types of legal tech offerings present.
…But Even eDiscovery is Evolving
One thing that has shifted is the growth of more end-to-end solutions that combine eDiscovery software with managed services. In an interview from the show floor, Thomson Reuters’ Ed Sohn gives a glimpse of how the field is evolving, using examples from Thomson Reuters Pangea3 Legal Managed Services business. He notes that Legal Managed Services has become an attractive career path and that the combination of services and software is what makes managed services effective. He also notes that law firm litigators are faced with a wider range of options and choices, and that there are situation-specific criteria for choosing between in-sourcing and working with outside managed services providers.
Microsoft is Out of the Closet
For the first time Microsoft seems to be fully engaged in parts of the legal solutions market, and this year’s show was a bit of a coming-out party. In 2014, the company announced its Matter Center, its practice management solution built on the cloud-based Office 365 platform. It has also completed its acquisition of eDiscovery and text analytics player Equivio recently.
Microsoft is clearly intent on making a bigger footprint in the legal market, all centered around and leveraging Office 365. Matter Center rolls together a lot of the basic activities of a law firm, including cloud storage, collaboration, search, document management, and various levels of permissioning and controls.
Blue Hill Research analyst David Houlihan had some interesting thoughts on the significance of the Equivio deal. He believes that this is more of an Information Governance play than an eDiscovery play. He sees Equivio as the basis for a native Information Governance (IG) solution embedded in companies running Office 365 environments. “Putting Equivio’s capabilities ‘in place’ in living Office 365 environments could represent a significant step toward reducing the difficulty of IG,” Houlihan stated. “Equivio’s technology automates the identification and classification of documents for retention and other IG needs, with minimal user involvement and IT intervention once the solution is trained. Microsoft Office solutions possess a user-base massive enough to be considered a default standard in business communications and productivity tools. Embedding Equivio technology within Exchange or SharePoint could effectively make IG a native capability of the document and email environments of a very large segment of companies.”
Biggest Deal Announced
ICONIQ Capital has acquired a minority stake in eDiscovery solutions provider kCura for $125 million. kCura provides the eDiscovery platform Relativity, and is one of the biggest players in the space. ICONIQ is known as an “exclusive members-only Silicon Valley billionaires club,” rumored to include Facebook’s Mark Zuckerberg and Twitter’s Jack Dorsey. kCura says it plans to invest in staff, technology, and its community of users, but that’s would still leaving a lot of cash remaining for acquisitions in case kCura is planning any consolidation of this fragmented market.
The Corporate Market is Much on Everyone’s Mind
A very large percentage of the Legaltech conference sessions had to do with the corporate legal and GRC (Governance, Risk and Compliance) markets. There were entire tracks devoted to the application of Information Governance in corporate settings, to better organize, identify, and defensibly delete potentially legally significant (or insignificant) data. Many times the goal is to simply make the corporate information environment “litigation ready,” with the result being that any eventual eDiscovery would processes faster and more painlessly. Other tracks were devoted to the complex and evolving relationship between General Counsel and GRC organizations.
One vendor pivoting toward this market is Wolters Kluwer, which has rebranded its combined Datacert and TyMetrix offerings for the in-house legal market as ELM Solutions (Enterprise Legal Management). It will target corporate legal departments, law firms, claims departments, and risk and compliance organizations; and its ambition is to be more than practice or matter management for in-house law departments, but rather more of a platform weaving together multiple activities (some supported by partners) including eDiscovery, document management, regulatory tracking, and content.
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