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The size of the U.S. EDD (electronic document discovery) market

Jeff Hodge, Executive Director, Corporate of matter management and e-discovery vendor doeLEGAL, wrote December 13th on the company blog about the growth of the electronic document discovery (EDD) market.

“Starting at about $40 million in revenues in 1999, the market appears to have grown to approximately $70 million in 2000, and then $150 million in 2001. We estimated that the total 2002 domestic, commercial market for EDD services was at least $270 million. (George Socha and Thomas Gelbmann, “The Size, Scope and Growth of the Electronic Data Discovery Market: Survey and Results”, 2003).” Hodge then refers to more current research from IBISWorld that found the EDD “industry has grown at an annual rate of 5.6% over the last five years to an estimated $786.5 million in 2011.”

My expertise does not extend to e-discovery, but it would not surprise me that spending almost tripled from 2002 to 2011, and that $800 million might be this year’s total e-discovery spend. If the U.S. corporate spend on legal is around $100 billion, with $60 billion of that going to external service providers, and $36 billion of that related to litigation, to estimate on the order of three percent in there for EDD sounds almost conservative.

Hodge muses: “An interesting side question, but one not addressed here, is whether the volume and complexity of litigation during the same time period might warrant such growth.” Numbers of law suits, I’m not sure, but trials, the costliest part of litigation, have dropped in frequency significantly (See my post of Dec. 20, 2011: decline in trials.).