When evaluating total cost of ownership, retrieving your data is often overlooked until you actually need to do so.
This multi-part series will explore the less-visible expenses tied to communication archiving solutions.
In this post, we’ll focus on widely known, frequently used archiving products and how their data extraction fees can escalate costs.
We'll cover:
What’s going on with these vendors’ data extraction fees (today’s post).
What you can do if you’re currently using or considering such an archiving solution (Part 2, coming soon).
Prefer to listen? Take this blog on the go with our AI-generated podcast by listening here.
Certain archiving vendors charge up to $50 per GB ($50,000 per TB) for data extraction, which can easily add up to five- or six-figure costs.
These fees often aren’t highlighted in contracts or sales discussions, creating unpleasant budget surprises.
While regulations mandate that vendors “surrender” data, they don’t cap fees, allowing high markups on storage costs.
Compliance professionals do a lot of planning: from vendor selection and system design to ensuring your firm stays on the right side of regulations. A critical, yet often overlooked, aspect of vendor selection is that getting data out of a system can be as costly as putting it in.
We see two primary reasons you might need to export data:
In scenario 1, you don’t want to be locked in because it’s too expensive to leave, and in scenario 2, you may have to pay thousands, potentially multiple times per year.
In any case, retrieving your data shouldn’t require raiding the emergency budget.
The kind of vendor under discussion often charges for data extraction on two main fronts:
Per-GB Data Export Fee
The fee is often around $50 per GB, which translates to $50,000 per TB.
This fee applies to any archived content (emails, chat messages, attachments, etc.) that you need extracted. The vendor can deliver the exported records in standard formats (e.g., PST for emails or EML/text files) via secure download.
In effect, the cost is volume-based rather than per-message, the more data (in GB) you retrieve, the higher the fee.
This means the bigger your archive, the bigger the bill. Storing thousands or millions of messages over multiple years can push your total export size into the terabytes, and that can quickly translate into five- or six-figure fees.
Professional Services Fees
On top of that, they charge an hourly rate (commonly around $300/hour) if you want their team’s help preparing or running the export.
The first hour of basic eDiscovery or audit assistance per year is provided at no charge, but beyond that, the $300/hour rate kicks in.
This means if you ask the vendor’s team to do the legwork of assembling your data export or conducting an extensive compliance search on your behalf, you’ll pay an hourly fee in addition to any per-GB charges.
For basic searching and exporting, you can technically do a lot of the legwork yourself using their portal or tools. But anything beyond routine tasks - like complex eDiscovery requests, custom formatting, or large-scale retrieval - may trigger professional services fees.
To put this in perspective, a single terabyte of data (1 TB) exported through the vendor could cost you $50,000 in fees. Meanwhile, you can buy a 1 TB external hard drive at a mainstream electronics store like Best Buy for around $90 - a fraction of the vendor’s charge.
Granted, it’s not a perfect apples-to-apples comparison (you’re paying for more than just the physical drive), but it does highlight how the raw cost of storage is drastically lower than the markup many vendors apply to data extraction.
The company does not advertise these fees in marketing materials, and there are no readily found quotes from executives specifically defending the export pricing. The fees are instead communicated through contracts and terms of service, buried in the fine print.
We can’t speak to their infrastructure or storage mediums, but we do know our own costs at SteelEye: it costs us $0.09 (9 cents) to export 1 GB of data.
If we were to charge $50 per GB, we would collect $49.91 in gross profit per GB.
This translates into two key metrics:
A markup of about 55,455% when comparing profit to cost ($49.91 / $0.09 × 100).
A gross profit margin of about 99.82%, comparing profit to revenue ($49.91 / $50 × 100).
In other words, a simple data export that costs only pennies to deliver could be sold for hundreds of times its actual cost.
Before we dive into specific examples, it’s important to understand how quickly archived data can grow - and how that growth translates into substantial export fees under a per-GB pricing model.
In the following illustrations, we’ll walk through sample scenarios for mid-size and small financial firms to show how routine day-to-day communications can accumulate into terabytes of data over several years.
By multiplying these volumes by the commonly cited $50,000 per TB rate, we demonstrate just how easily the costs can reach five or six figures, illustrating why data extraction fees deserve careful consideration from the outset.
Below are two illustrative scenarios: one for a mid-size financial firm with 300 monitored individuals and another for a smaller firm with 30. Estimates based on typical data generation rates for the specified channels and user numbers over a 4-year period.
Bear in mind, this is a conservative example. In our experience, most mid-sized firms tend to have 5-7 communication channels, rather than just Email & Bloomberg.
Mid-Size Financial Firm
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Small Financial Firm
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One common frustration is that these fees often seem buried in contracts. While not technically secret, they’re not front-and-center in sales discussions.
Firms often sign up expecting standard monthly or annual costs, only to learn, too late, that the bill for retrieving their own data can be astronomical.
Regulations like SEC 17a-4 (for broker-dealers) require vendors to “surrender promptly” a client’s archived records upon request. The vendor meets this by offering extraction - often touting a 24-hour turnaround. But “surrendering” data and charging for it are two different things.
In other words, the regulations mandate availability, not necessarily affordability - leaving a commercial loophole.
Here’s why I consider these extraction fees to be a risk factor rather than just an expense line:
Vendor Lock-In: High fees can discourage you from switching providers, even if you’re unhappy with the service or find a better fit elsewhere.
Budget Spikes: Big unplanned costs for eDiscovery or regulatory requests can blow through your compliance or IT budget in short order.
Negotiating Power: If you know about these fees after you’re already reliant on their platform, you may find your negotiation leverage with the vendor is lower.
Beyond the financial implications, there’s also an ethical consideration: How long can vendors justify charging exorbitant fees for such basic requests, and might FINRA or other regulators eventually address this disproportionate pricing?
Data extraction fees aren’t merely line-item expenses; they represent potential risk and ethical concerns. As regulated firms demand greater transparency and data ownership, vendors that inflate extraction fees risk reputational backlash.
If regulators ever issue more precise guidance on the reasonableness of these fees, some vendors’ practices may come under closer scrutiny.
Ultimately, your compliance data is your asset. You should demand solutions that grant you control and transparent access, not ones that hold your data hostage with punitive retrieval costs.
Compliance solutions should empower you to access, export, and control your own archives.
In Part 2, I’ll delve into some strategies you can consider to either avoid or mitigate these fees and ensure you truly have control and flexibility with your archives. We’ll talk about:
Negotiation tips (before you sign up or renew).
Technical approaches to reduce data volume or handle exports more efficiently.
Contractual clauses or vendor management best practices to protect you from unpleasant surprises.
Stay tuned!
If any of these scenarios resonate, or you’ve faced hidden data-export charges in your own archiving setup, we’d love to hear from you.
Please share your experience via our contact form. Your insights will help shape Part 2 of this series and build a community that stays one step ahead of these fees.
Below is a sample calculation that scales down the mid-size firm scenario by a factor of 10, matching 30 people instead of 300. If your small-firm numbers differ, adjust accordingly.
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Mid-Sized Financial Firm |
Small-Sized Financial Firm |
Outlook Email Export
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Outlook Email Export
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Bloomberg Export
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Bloomberg Export
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TOTAL EXPORT FEE
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TOTAL EXPORT FEE
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Working vs. Non-Working Days:
We assumed 250 working days per year plus an extra 25% volume increase to account for weekends/holidays which have modest communication volume.
If your firm operates differently or if messages spike on weekends, revise accordingly.
Cost per TB:
We used $50,000 per TB, which aligns with the often-cited $50/GB.
If your contract states a different rate, plug that in.
Message Size:
We used 100 KB/email as a reference. Some industries might have heavier attachments; this could inflate daily GB.
Bloomberg vs. Outlook Ratios:
We assumed the Bloomberg data daily volume is 4.5 GB for 300 people (and proportionally 0.45 GB for 30 people). Your actual ratio may vary.
Rounding:
Totals are approximate. Small discrepancies ($1,000 here or there) can arise from rounding to the nearest hundred or thousand.
By walking through these calculations, you can see how even a modest number of monitored individuals can generate terabytes of archived data - and how quickly the export costs can balloon under a $50/GB fee model.