I have to take issue with most of this post.   

I see the exact opposite in the industry.  Most small lenders are becoming more sophisticated.  They may use the term "environmental", but this is tied to the fact that they often order multiple products/services and thus generalize, rather than specify an exact service.  They know the difference between a Phase I, a Transaction Screen, an RSRA and a database report.

I think every EP on this site is aware that providing Phase I's is a mature industry, it has been for years.   However, EP's that are interested in performing Phase I are not content with the status quo as you state and have analyzed every piece of their process to reduce cost and provide a better product.  Those that have not done this are likely in the category of providing Phase I's for existing clients and not actively marketing them. Interestingly, those providers often tell me that they get significantly higher prices for Phase I's because it is relationship driven.

Maybe you didn't mean it, but you seem to have bashed both EP's and lenders in this post.

I don't think it was intentional, but when you use the term "unsophisticated" and "providers want to keep the status quo", both have negative conotations.  Choose your words wisely. 

This site no longer represents a minority, it's a majority. 

Interesting. While it is true that the cost of computers has gone down (see Moore's Law and the Producer Price Index from the BLS), in many cases the price a consumer actually pays "out-of-pocket" for a computer (the observed price) has stayed pretty much the same for many years.

Take, for example, the computers sold by Apple.  The flagship Apple Mac Plus product cost $2599 when it was introduced in 1986 -- in today's dollars, that's $5,174. These days, Apple lists its top of the line Mac Pro with monitor for $5098.  25 years later, the price a consumer pays for a top of the line Mac remains almost exactly the same. 

Another example from Apple: the IPod in 2001 cost $492 in today's dollars; the IPad of today costs $499; a new IPhone without the contract subsidy costs $499 - $699.

This same pricing model holds for Microsoft PC's as well.  The first IBM PC, released in 1981, typically sold for $3000 for home use, or $7200 in today's dollars.  Remember, this was the top of the line IBM home computer at the time.  Today, the top of the line Windows Dell home gaming computer can be purchased for well over $7200, assuming you order the most modern componants available. So, in this case, prices have actually increased, rather than decreased.  Furthermore, even low end prices for computers running Windows have held steady at slightly above $1000 for years, assuming you get the popular technology of the day like speakers, wireless, and a decent monitor.

Of course, actual prices for directly comparable component technology have gone down geometrically, due to competition and innovation, but the demand for new features has helped keep actual out-of-pocket prices fairly steady in comparison, and the consumer continues to pay the same amount for the standard accepted technology of the day.

The story doesn't end there, though. While component prices for similar goods have been decreasing, at the same time overall corporate technology spending has been increasing substantially. Corporations continue to invest in new computer technology at growing rates.  For details, see this excellent series of several articles from Harvard Business Review. 

In short, an economic model based on what happens in the the computer industry has three possible structures:

1. A model of improving features but steady prices for final to market products

2. A model of increasing corporate spending on the technology

3. A model of rapidly declining prices for directly comparable parts and components

Now, back to the Phase I market. If you are saying that Phase I pricing is following some normative economic model analogous to computers sold to consumers and corporations, then it seems you ought to be saying that actual Phase I pricing should be holding steady and that the features offered in the Phase I should be improving over time. You also ought to say that total corporate spending on environmental due diligence should be increasing, again following the computer model. 

But, that is not what you are saying.  You seem to be saying that, as if it were similar to the parts and components of a computer, Phase I "components"  go down in price as raw materials and production processes improve under the steady pressure of competition. But this is odd thing to say: the main cost component of a Phase I is simply the professional service provided, and services, like all consulting relying on highly qualified people, are much more resistant to pricing reductions than material components, because its much more difficult to get large cost reductions from U.S. labor than from a material object that can be produced overseas or from a software product where development can be tightly streamlined.  In any event, with professional services, short of overseas outsourcing, you certainly cannot get the same kind of geometric price reductions found in the computer component industry. Needless to say, it seems unlikely that Gordon Moore intended to include environmental due diligence in his famous formulation about computer processing power.

In summary, while there is an economic story here to be told about Phase I ESA pricing pressure, competition and quality, it seems that an analogy with a computer isn't the clearest way to tell it.