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Value vs. Savings in Legal Cloud Computing

Nextpoint is not a private jet kind of company. That didn’t stop a boutique private jet firm from trying to pitch us on the value of buying time on one, promising to cut, “hourly rates, outrageous fuel surcharges, expiring prepaid hours and annoying peak day restrictions.”

 

 

 

 

 

 

 

 

 

 

Really?
This seems like a terrible pitch. The service being offered is a private jet, which assumes the passengers are too busy and too important to fly commercial. Yet, the pitch is about how much less expensive their service is–selling a high-value, high-priced service by talking price. The whole point of a high-value service is the valuable service it provides. If someone is going to consider travel costs purely based on cost, they will never pay for a private plane. That person will always fly commercial. The same is true for litigation services. Many service providers these days are jumping on the legal cloud computing train and promising the lowest possible price. But does their provided solution solve your problem?

Where’s The Beef?
Corporations already spend a lot of money on technology. But if the technology doesn’t work to efficiently solve their problem, it’s value proposition is busted. In litigation, if they don’t have the support they need, they can’t get their work done. They will spend their money on a solution that does work, even if it is more expensive–they get VALUE for their dollars spent.

Forbes recently discussed the right way to measure return on investment in cloud services. The article was based on a broader study by the Garner Group on cloud computing. The bottom line is that cloud technology is not the answer to all IT problems because it is a less expensive alternative to in-house IT. Cloud technology solves your litigation support problems, and that is where the value lies. Cost savings is an additional benefit, but it is not the primary concern.

The problem corporate legal departments face is complexity– managing legal holds and preservation demand letters, avoiding spoliation claims, dealing with recurring litigation, intellectual property and trademark protection, meeting regulatory requirements, enforcing document retention policies, and the volume of data involved in managing these issues. Cost is on the list of concerns, but only once those other requirements are satisfied. No corporate counsel is going to tell their boss, “well, we lost a $10 million dollar judgement for losing evidence, but look, we saved $1 million is hosting costs!”

Know the Value.
As more eDiscovery, litigation, and trial technology claims to be cloud-based, prices for hosting and data processing services will continue to fall. But the question for those providers is whether their services take advantage of the cloud platform to provide more powerful solutions. By 2020, the average case will involve 1.6 terabytes of data. Can your cloud software scale? Can your technology archive social media and other content in a forensically sound review platform? Does it provide end-to-end litigation service? Those are the questions that matter. Price per gigabyte is obviously a concern, but only if the technical questions around managing your case have been satisfied first. As the Forbes piece puts it, “Price is determined by what the market will bear. Performance is tracked based on any number of metrics that are related to what you want to get out of the service.”

Jason Krause

Jason Krause is a veteran of the legal technology industry with more than a dozen years of experience as a journalist covering eDiscovery. Prior to joining Nextpoint’s marketing department, Jason was a writer and reporter for the American Bar Association’s ABA Journal, where he was one of the first to recognize and report on the impact exploding volumes of evidence is having on litigation. He has also covered the industry as a freelance writer and independent marketing consultant for publications such as Law Technology News. Connect with Jason on Google Plus.

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