Ediscovery Moves to Cloud Computing: Why to Stop – or Start – Worrying

[This is Part One of a three-part series.]

 

The legal industry makes no secret of its hesitance to adopt legal technology. Countless articles and blog posts have been written on the subject. (See “Further Reading” at the end of this post.) Be it the fear of lawyers being made obsolete by artificial intelligence, concern about reduced billable hours, disinterest in learning how to use new software, or the older generations refusing to adapt to technological advances, law is one the slowest industries to adopt new technologies. And now, even for those law firms brave enough to have made The Great Technological Leap, there’s the ediscovery move towards cloud computing to contend with.

Many businesses are scared of the transition to the cloud because they don’t fully understand what it is, i.e., a network of servers that allow you to access data anytime, anywhere.  According to a recent article published in Forbes, 92% of computing workloads will be processed by cloud data centers by 2020. Why is more big data – sets of data that are so large or complex that traditional tools are unable to handle them – being pushed to the cloud? Convenience, collaboration, and cost.

  • Convenience: 24% of people in 2015 did some or all of their work from home.
  • Collaboration: Cloud computing allows employees to access shared work and software anytime, anywhere.
  • Cost: Individual businesses don’t maintain the server, which saves money on IT management costs, upgrade costs, and costs that arise with downtime when updating software and servers.

The cloud is making work easier and cheaper, but there are some reasons to worry.

One major concern with the cloud is security – that all of that big data living off-premises and in a huge data center, in someone else’s hands, makes it less secure – and you can’t blame businesses (particularly law firms) for being worried about that. Any leak of PII is going to be an extremely expensive mistake, and New York State Attorney General Eric T. Schneiderman says data breaches are up 40% last year in New York alone. With the average cost of a data breach now around $4 million, 67% of law firms marked security management as their top IT task. While cloud providers can improve security by implementing sophisticated encryption techniques and offering the expertise of security experts and staff, over 90% of security issues originate with enterprises, and not the cloud. The real concern companies should be focused on is with their own infrastructure.

Another major concern in ediscovery moving to cloud computing is how it changes the role of the ediscovery managed service provider. Their entire business model is based on hosting ediscovery/document management platforms – such as Relativity – and that could be completely undercut if law firms and in-house legal departments have direct access to a cloud infrastructure where they can host and manage their review. Big data is being taken out of the hands of the service provider and put directly into the cloud provider’s, a change that is difficult to work with according to service providers. For example, service providers expressed concern about the cloud in general and kCura’s new cloud option, RelativityOne, at RelativityFest this year:

“kCura needed to go to the cloud to get ahead of the competition,
but it is scary for us service providers.”

“RelativityOne is a smart play from a business perspective,
but they are going to [bleep] a lot of people off in the process.”

“I’m wondering if I need a backup plan.”

Changes in the legal industry, however slow-moving, are being driven by the customer – i.e., those law firms, in-house counsel, and organizations that are using managed services – and so far, customers are seeing far more pros than cons with the cloud. In fact four out of five cloud adopters are reporting significant process improvements, while 82% indicate substantial cost savings. During this inevitable shift of ediscovery moving fully over to cloud computing, service providers are looking at their options and restructuring their business models, as businesses need to do occasionally to stay relevant. The convenience of the cloud is getting a lot of attention and shows no sign of slowing down – even in the historically slow-moving legal industry –  so for law firms and service providers, it’s best to consider how the cloud can impact the ediscovery process and business in general. As with anything else, it’s always best to be prepared.

Join us next week when we dive into the cloud option kCura is developing for Relativity, RelativityOne, and how service providers should prepare.

Read Part Two here, and Part Three here.

 


 

For Further Reading:

Law Firms Hesitant to Adopt Legal Tech
http://www.forbes.com/sites/maryjuetten/2015/02/19/legal-tech-or-tech-legal/#595ec4d644d0
http://www.lexology.com/library/detail.aspx?g=3f1d8ec4-ba19-488e-8ae7-128859472ea1
http://www.seytlines.com/2015/07/lawyers-must-overcome-their-fear-of-tech/
https://odomackerman.com/category/technology/
https://www.encompasscorporation.com/why-fear-is-the-blocker-to-innovation-in-law-firms/

PII Leaks Are Expensive Mistakes
http://www.marshalldennehey.com/defense-digest-articles/data-breach-101
http://milyli.com/pii-disclosur-disastrous/
http://www.mvalaw.com/news-publications-347.html
http://www.csoonline.com/article/2926727/data-protection/ponemon-data-breach-costs-now-average-154-per-record.html