Parties contracting out their eDiscovery needs must take charge of the process early on. However, doing so poses some fascinating and particular difficulties for businesses that lack knowledge or experience interacting with the wide range of eDiscovery suppliers.
This article will describe how companies should choose vendors when contracting with a third party to handle their eDiscovery initiatives. The correct eDiscovery pricing model must be chosen because they differ greatly amongst vendors and significantly impact total expenses.
When outsourcing eDiscovery projects, selecting vendors with pricing models that provide cost assurance and control for your circumstance is also essential. Today’s market is dominated by three fundamental eDiscovery price models: conventional, fixed charge per custodian or matter, and fixed cost upon ingestion.
The Conventional Model:
The conventional approach, which is still in use today, focuses mainly on line-item pricing for each eDiscovery vendor’s service, including collection, processing, hosting for review, predictive coding, and production. Vendors will charge an ingesting cost for any theoretically discoverable information, a processing fee for processes like image conversion, optical character recognition (OCR), culling or filtering based on search keywords, and hosting fees. OCR’s lengthy processing time and CPU-intensive nature has been portrayed as a significant cost component. Suppliers will charge a hosting price each month that an eDiscovery case is housed in the vendor’s facilities under the conventional model.
Additionally, they frequently charge a per-seat fee for any person who needs access to the packaged data. Predictive coding is more popular and is increasingly being offered by many suppliers as an essential service, while some conventional methods still require a production cost.
Fixed Per Custodian or Per Matter Fee Model:
This pricing model assesses a set fee per matter and data custodian. This strategy may not offer adequate value since each custodian typically wants a different amount of data size and process complexity. This strategy offers a good deal when there are a limited number of custodians, and each has a sizable volume of data to handle. This approach performs poorly when there are more custodians, each with a limited quantity of data.
Fixed Fee Model Upon Ingestion:
In the fixed price upon ingestion eDiscovery pricing model, a company supplies a vendor with all its information for a case. The vendor offers a flat rate per gigabyte ingested to handle the information through the case’s conclusion. Despite having excellent predictability, this model evaluates charges before a significant portion of the data can be removed.
Final Thoughts:
Pricing for eDiscovery is like comparing apples and oranges. It has been observed that project cost estimates might vary by order of magnitude, making finding new customers for these services a complex process with a high degree of stress and no clear way to assess success. It is essential to thoroughly compare the different models depending on the facts the customer is aware of and select the one that best utilizes that knowledge.
From a purely value-based standpoint, the ideal method for managing and scoping an eDiscovery project focuses on reviewing the information while a case is being prosecuted. This method should be used when selecting a provider that offers the optimal price model.
