 Service Provider News ReportThis newsletter is sponsored by Network General Ease Application Performance Headaches Network World's Service Provider News Report Newsletter, 06/13/07Updated e-discovery rules prompt new managed servicesBy Carolyn Duffy MarsanHave you reviewed your e-mail and electronic document retention policies and procedures lately? If not, you should. New federal rules went into effect in December that require companies to preserve all relevant e-mail, word processing documents, spreadsheets and databases when litigation seems likely to occur. The new rules – dubbed e-discovery rules – are causing law firms, insurance companies, financial services, pharmaceuticals and many others to revamp their e-mail archival, storage and retention processes and systems.
Although storage vendors are most focused on this niche, service providers such as IBM and Verizon Business also are tapping into this market. IBM is meeting e-discovery requirements through its Lotus FaceTime software and related services, while Verizon Business has an e-mail archival system due out the first half of this year. These IT and telecom service providers will be competing against specialty houses such as Onsite E-Discovery, a leading provider of litigation support services to law firms and corporations in the United States. Other e-discovery service providers include BlueStar Computer Solutions and Litigation Logic. All of these vendors are going after a big prize: e-discovery technology spending will top $4.8 billion by 2011, according to Forrester Research. The updated Federal Rules of Civil Procedure solidify changes to e-discovery rules that have been emerging from individual cases. To meet these new rules, CIOs must consider both their document retention policies and their data retention architectures. "If you were to serve a discovery request on an individual, it’s not that big of a deal because they might have one computer at home. But if you were to serve on IBM and ask them for all of their e-mails related to this one issue, what does a company do? This is a huge issue that corporations have to address," explains Phil Fowler, e-discovery expert and partner with Bingham McHale in Indianapolis. Fowler says IT executives need to have a game plan for when litigation occurs and they are hit with an e-discovery request. "IT people need to understand their information architecture, their computer networks and systems, so they understand where information is created, where it is stored and how it is stored including backup tapes," Fowler says. "That’s going to be critical for understanding the costs and methods of complying with an e-discovery request." If a company is hit with a lawsuit or believes it will be hit with a lawsuit, it needs to put its standard document retention and destruction schedules on hold. Companies should expect that most litigation will involve e-discovery. "In the federal courts, at least 80% of the cases involving multinational corporations will involve electronic discovery, and that number is going to increase to 100% in the next few years," Fowler predicts. These include employee discrimination, breach of contract, patent and trademark cases, to name a few. "It’s easier to ask what cases wouldn’t be involving e-discovery," Fowler says. E-discovery is very expensive, running tens or hundreds of thousands of dollars as companies scramble to gather data from the hard drives of computers, servers and backup tapes. The more complex a company’s IT architecture, the more expensive it is going to be for IT staff or outsiders to find all of the data related to pending litigation. The new e-discovery rules "add a layer of complexity and cost to corporations with increased burdens on their staff including IT people," Fowler says. "That’s the ultimate take-home message." Fowler recommends that companies create a team involving their CIOs, general counsels and outside counsel to review document retention policies and create an e-discovery plan. CIOs that don’t want to handle e-discovery requests themselves can turn to specialty service providers like Onsite E-Discovery, which has a consulting group that helps companies proactively design document workflow and storage systems or react to e-discovery requests. Onsite also offers a secure online repository for all parties to search and retrieve documents for litigation. "We host the application in our facility, and we are storing and managing all the documents on our servers," says Deborah Rossier, vice president of ASP services for Onsite. "The lawsuit parties are allowed in via the Web to access that material, but we are fully managing the process of reviewing the documents." Onsite executives say they are seeing more CIOs and general counsels working together to respond to e-discovery requests. "Nobody in the IT world has ever thought about how you address e-discovery requests in a logical way," Onsite CEO Mark Hawn, says. "That’s where we’ve really focused our technology and our ability to go out and sell that kind of a managed service for corporations." Rossier says her clients include a pharmaceutical company that has terabytes of information related to a lawsuit housed with Onsite, which provides secure access to that data to several law firms involved in the case. Another client is a financial institution that is using Onsite’s service to host documents that it has to produce for the Securities and Exchange Commission. "These companies don’t have the IT support and they don’t have the network infrastructure to provide multi-party access to large volumes of data all over the country," Rossier says. "They can buy our service with a monthly recurring fee depending on how much storage is on our file servers." Rossier says Onsite’s services run hundreds of thousands of dollars a month for large lawsuits, but they are still less expensive than building a secure document repository and staffing up to manage it.
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| Contact the author: Carolyn Duffy Marsan is a senior editor with Network World and covers emerging Internet technologies and standards. Reach her at cmarsan@nww.com This newsletter is sponsored by Network General Ease Application Performance Headaches ARCHIVEArchive of the Service Provider News Report Newsletter. BONUS FEATUREIT PRODUCT RESEARCH AT YOUR FINGERTIPS Get detailed information on thousands of products, conduct side-by-side comparisons and read product test and review results with Network World’s IT Buyer’s Guides. Find the best solution faster than ever with over 100 distinct categories across the security, storage, management, wireless, infrastructure and convergence markets. Click here for details. PRINT SUBSCRIPTIONS AVAILABLE International subscribers, click here. SUBSCRIPTION SERVICESTo subscribe or unsubscribe to any Network World newsletter, change your e-mail address or contact us, click here. This message was sent to: networking.world@gmail.com. Please use this address when modifying your subscription. Advertising information: Write to Associate Publisher Online Susan Cardoza Network World, Inc., 118 Turnpike Road, Southborough, MA 01772 Copyright Network World, Inc., 2007 |
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