More Than OneNote: Will Microsoft Break Into EDD?

Microsoft is not currently offering products specifically designed for e-discovery processes, but it's just a matter of time before it does, says Laura DiDio, research fellow at industry analyst firm The Yankee Group.

The burgeoning e-discovery market, which some industry watchers expect to approach $3 billion by 2007, could hardly have escaped the Redmond, Wash., software giant's radar, DiDio says.

“Like everyone else, Microsoft is searching for the next big thing,” DiDio told American Lawyer Media ' which publishes e-Discovery Law & Strategy ' late last year. “Part of their current strategy is to target specific verticals – health care and life sciences, for example. EDD [electronic data discovery] provides them with a clear and compelling differentiator in the market for legal services. You're not going to have that type of functionality in the Linux and open-source market at this point, and probably not for the next 2 years. There is a huge opportunity for growth in this market over the next 24 months, and it's a market they're serious about.”

The Microsoft representatives contacted for this story wouldn't comment on the company's EDD strategy (or confirm whether there was one), but they were eager to promote Micro-soft's OneNote product, which the company has been pushing hard to the legal community as a tool to help with transcribing case notes, compiling research, recording depositions, tracking billable hours and sharing findings with team members.

What Microsoft Says

Microsoft even maintains a site called OneNote 2003 for Lawyers, through which it provides free trials of the product, case studies, tips and tutorials. On the Top 10 Ways Lawyers Can Benefit from OneNote page, it lists, among other things: “Keep all your client notes in one place,” “Share client notes with paralegals and other lawyers,” “Access Westlaw, LexisNexis, or other research directly from OneNote” and “Record depositions or interviews directly from your PC or laptop.”

Microsoft describes OneNote as a “personal productivity workspace assistant,” and it promotes the application as a replacement for the writing pad. The current version of the product, OneNote 2003, is designed to enable users to capture, organize and reuse notes electronically, not just on tablet PCs, but also on desktop computers and laptops. The upcoming version, which will be part of the Office 12 product family, is expected to include a “shared notebook” feature designed to allow the program to be used by small and medium-size groups, as well as by individuals.

In a recent posting to his blog, Chris Pratley, OneNote program manager, wrote: “One of the long-term visions for OneNote is to bring together 'your information' and make it findable and reusable, regardless of format. … As you know from the current release of OneNote, there's a lot of value in just being able to capture various kinds of information in one place: text, HTML, ink, photos, audio/ video recordings. In OneNote '12,' we're going to go even farther. … More or less, anything you put into OneNote 12 becomes searchable.”

What Some Others Say

But OneNote is not an electronic data-discovery solution, observes EDD consultant George Socha; nor does it lend itself readily to enhancements or plug-ins that might make it into one.

If, or when, Microsoft does move into the EDD market, Socha says, it will likely be through an acquisition, rather than with a home-grown solution. “Microsoft seems to be most successful when it's selling software,” he says. “So it would make sense that they'd be more interested in a software company than a services company.”

Socha hasn't heard of any plans afoot at Microsoft to move into the EDD market, but he allows that, with between 300 and 500 vendors currently offering some kind of EDD service or software, it's a ripe market in which consolidation is already taking place. But it's still the early days for EDD, he says; no sooner do existing vendors consolidate than new ones appear.

Adds The Yankee Group's DiDio: “The market is so Darwinian that everyone is encroaching on everybody else's space. I would expect that if [Microsoft] decides to go full bore into the EDD market, they will buy or partner with someone. They'll do what they did with [business software maker] Great Plains [in 2000], and with some strategically placed security vendors. They won't reinvent the wheel.”

DiDio points to Microsoft's recent deals with rivals Palm, RIM and Yahoo!, which seem to augur a new willingness in Redmond to partner as a strategy for expanding into specialized markets.

Microsoft Wants You To Find Data

It's also clear that Microsoft is serious about search. The company is trying to out-Google Google with its MSN search engine. Another project, dubbed MyLifeBits, reportedly under development at the Media Presence Research Group in Microsoft's San Francisco-based Bay Area Research Center, aims to capture a lifetime's worth of media ' paper records, pictures, bills, receipts, music, video ' store it digitally, and make it easily searchable and retrievable.

And recent data-access improvements in the latest versions of a range of soon-to-be-launched Microsoft products, from Word and Outlook to Visual Studio and SQL Server, provide not only the ability to handle more data, but also more data types.

The Wherefores Of What-If?

Microsoft's OneNote strategy is also likely to provide a useful opening into this market, Socha says. “One of the things that all attorneys have to do is take a lot of notes,” he explains. “They take them during depositions, during hearings, during interviews. And they've got to make sense of all those notes. That seems to me the place where OneNote fits, as a tool to enhance attorneys' abilities to keep track of what they do as they investigate and analyze.”

If Microsoft decides to move beyond OneNote with an EDD offering, it would bring a powerful brand name to that market, DiDio says. “One of the reasons that Windows and Office are so strong is that they hold the applications high ground. Microsoft has a very deep and broad reseller channel, and a very deep and broad third-party ISV [independent software vendors] community. And they're getting a lot better about putting leading-edge features into their products.”

And with so many law firms already relying on Microsoft products for other tasks, adding EDD to the mix could be a natural fit, Didio suggests.

“From the point of view of a buyer in a law firm,” she says, “which is probably a Windows shop, you really couldn't go wrong with a Microsoft-branded EDD solution.”

Microsoft is not currently offering products specifically designed for e-discovery processes, but it's just a matter of time before it does, says Laura DiDio, research fellow at industry analyst firm The Yankee Group.

The burgeoning e-discovery market, which some industry watchers expect to approach $3 billion by 2007, could hardly have escaped the Redmond, Wash., software giant's radar, DiDio says.

“Like everyone else, Microsoft is searching for the next big thing,” DiDio told American Lawyer Media ' which publishes e-Discovery Law & Strategy ' late last year. “Part of their current strategy is to target specific verticals – health care and life sciences, for example. EDD [electronic data discovery] provides them with a clear and compelling differentiator in the market for legal services. You're not going to have that type of functionality in the Linux and open-source market at this point, and probably not for the next 2 years. There is a huge opportunity for growth in this market over the next 24 months, and it's a market they're serious about.”

The Microsoft representatives contacted for this story wouldn't comment on the company's EDD strategy (or confirm whether there was one), but they were eager to promote Micro-soft's OneNote product, which the company has been pushing hard to the legal community as a tool to help with transcribing case notes, compiling research, recording depositions, tracking billable hours and sharing findings with team members.

What Microsoft Says

Microsoft even maintains a site called OneNote 2003 for Lawyers, through which it provides free trials of the product, case studies, tips and tutorials. On the Top 10 Ways Lawyers Can Benefit from OneNote page, it lists, among other things: “Keep all your client notes in one place,” “Share client notes with paralegals and other lawyers,” “Access Westlaw, LexisNexis, or other research directly from OneNote” and “Record depositions or interviews directly from your PC or laptop.”

Microsoft describes OneNote as a “personal productivity workspace assistant,” and it promotes the application as a replacement for the writing pad. The current version of the product, OneNote 2003, is designed to enable users to capture, organize and reuse notes electronically, not just on tablet PCs, but also on desktop computers and laptops. The upcoming version, which will be part of the Office 12 product family, is expected to include a “shared notebook” feature designed to allow the program to be used by small and medium-size groups, as well as by individuals.

In a recent posting to his blog, Chris Pratley, OneNote program manager, wrote: “One of the long-term visions for OneNote is to bring together 'your information' and make it findable and reusable, regardless of format. … As you know from the current release of OneNote, there's a lot of value in just being able to capture various kinds of information in one place: text, HTML, ink, photos, audio/ video recordings. In OneNote '12,' we're going to go even farther. … More or less, anything you put into OneNote 12 becomes searchable.”

What Some Others Say

But OneNote is not an electronic data-discovery solution, observes EDD consultant George Socha; nor does it lend itself readily to enhancements or plug-ins that might make it into one.

If, or when, Microsoft does move into the EDD market, Socha says, it will likely be through an acquisition, rather than with a home-grown solution. “Microsoft seems to be most successful when it's selling software,” he says. “So it would make sense that they'd be more interested in a software company than a services company.”

Socha hasn't heard of any plans afoot at Microsoft to move into the EDD market, but he allows that, with between 300 and 500 vendors currently offering some kind of EDD service or software, it's a ripe market in which consolidation is already taking place. But it's still the early days for EDD, he says; no sooner do existing vendors consolidate than new ones appear.

Adds The Yankee Group's DiDio: “The market is so Darwinian that everyone is encroaching on everybody else's space. I would expect that if [Microsoft] decides to go full bore into the EDD market, they will buy or partner with someone. They'll do what they did with [business software maker] Great Plains [in 2000], and with some strategically placed security vendors. They won't reinvent the wheel.”

DiDio points to Microsoft's recent deals with rivals Palm, RIM and Yahoo!, which seem to augur a new willingness in Redmond to partner as a strategy for expanding into specialized markets.

Microsoft Wants You To Find Data

It's also clear that Microsoft is serious about search. The company is trying to out-Google Google with its MSN search engine. Another project, dubbed MyLifeBits, reportedly under development at the Media Presence Research Group in Microsoft's San Francisco-based Bay Area Research Center, aims to capture a lifetime's worth of media ' paper records, pictures, bills, receipts, music, video ' store it digitally, and make it easily searchable and retrievable.

And recent data-access improvements in the latest versions of a range of soon-to-be-launched Microsoft products, from Word and Outlook to Visual Studio and SQL Server, provide not only the ability to handle more data, but also more data types.

The Wherefores Of What-If?

Microsoft's OneNote strategy is also likely to provide a useful opening into this market, Socha says. “One of the things that all attorneys have to do is take a lot of notes,” he explains. “They take them during depositions, during hearings, during interviews. And they've got to make sense of all those notes. That seems to me the place where OneNote fits, as a tool to enhance attorneys' abilities to keep track of what they do as they investigate and analyze.”

If Microsoft decides to move beyond OneNote with an EDD offering, it would bring a powerful brand name to that market, DiDio says. “One of the reasons that Windows and Office are so strong is that they hold the applications high ground. Microsoft has a very deep and broad reseller channel, and a very deep and broad third-party ISV [independent software vendors] community. And they're getting a lot better about putting leading-edge features into their products.”

And with so many law firms already relying on Microsoft products for other tasks, adding EDD to the mix could be a natural fit, Didio suggests.

“From the point of view of a buyer in a law firm,” she says, “which is probably a Windows shop, you really couldn't go wrong with a Microsoft-branded EDD solution.”