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        Mark Smith's Analyst Perspectives

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        Industry Exposé: Technology Vendors Skew Analysts and Influencers

        In my more than a decade of writing on the trends and direction of the technology industry, occasionally I have talked about the dark side of technology industry analysts. In that vein, I wrote about the diminishing science of research in technology analyst firms, which has impacted the quality of the analysis and advice given by analysts. It built on my previous post on Why Bad Research Could Jeopardize Your Business. Unfortunately, the ethics and morals in the technology analyst industry have not gotten a lot better since I wrote those pieces, especially when it comes to the objectivity and independence of the research. Now it is time to provide shed light on the financial bias of written research and blogs by industry analysts and the firms they represent and publish under in coverage and rating of technology vendors.

        What qualifies me to make that assessment? In my career I worked at technology vendors, among them Oracle and SAP, before I became an industry analyst at META Group, now part of Gartner. After a stint as a solo independent analyst and after spending some time reflecting on cleaning up this industry, I started Ventana Research a decade ago. Our firm focuses on supporting business and IT with in-depth fact-based research, including primary research and deeper analysis of technology products to help assess and recommend better technology strategies and plans.

        Information from industry analysts can provide critical input for technology decisions. Given the rapid pace of technology change, it is not easy for businesses, no matter how large or small they might be, to determine what technology trends and vendors they should work with. Yet despite the increasing need for informed help on the part of businesses and IT, the volume of timely research from the large analyst firms has gotten smaller, not larger. Granted, the business of reviewing, editing and publishing research is no easy task, and the larger the research firm the more challenging the process. But nowadays one insidious factor is having a pernicious impact on not only the timeliness of the research but its honesty as well. The dirty secret is that some of the largest technology vendors have forced industry analyst firms to contractually agree to the right to review, edit and approve any written research that references their name or products before it is published.

        Technology vendors claim this is because they want to fact-check industry analysts’ work before it is published. However, it is the job of research analyst managers and their operations staff to ensure that what is written is accurate and properly stated. We have done it that way for a decade and refused the financial control of our research just to get access or to have our research purchased. And vendors, even the best-intentioned, cannot escape the biases they bring to reviews of their products. Vendors’ heavy oversight has led to less research from industry analysts being written that offers a useful level of detail or analysis, let alone opinion. Moreover technology vendors use their influence to control access to their executives, offering interviews to those who agree to play this game and leaving out those who do not while leaving executives in the dark about the decisions about who is being scheduled.

        Nowadays, Internet information has significant influence on technology buyers. Social media dialogue and blogs have surpassed the influence of industry analysts. Here again, though, some vendors are bringing money to bear to influence this channel. We have technology vendors now who are paying for seemingly independent blog entries to be written in order to gain visibility and promote their latest announcements or marketing activity. If you read a blog entry that ends in a promotion of a vendor activity like a webinar or event that seems out of place – well, it probably is. Any coverage of technology vendor products should be based on the merit of the technology and its impact to the market, customers and the analyst research agenda and not the result of the financial influence of a technology vendor. Blogs and written research that has been funded should have a disclosure at bottom disclosing it has been funded directly by the specific vendor no matter where you read it as they are distributed and syndicated across the Internet.

        I feel personally obliged to help reestablish the standards of the industry analyst business, as it plays a critical role for research buyers and suppliers of technology. This is an industry that I passionately enjoy working in, but it needs cleaning up. Individuals and firms that represent themselves as industry analysts and influencers should not allow vendors to use editorial or financial influence to shape their research. Technology providers should stop demanding contracts that allow them approval of research or paying covertly for written coverage and should cancel existing agreements that do so immediately. If industry analysts and teams cannot apply quality control to their own research or correct errors after publication, and if the head of research is not able to stand by the research written, you as a company executive should not work with them. Unfortunately, today you still have to scrutinize everything you read from what you might think is a trusted provider, and certainly from any new source, to ensure you have analysis and opinion you can trust and not propaganda that has been edited, cleansed or manufactured.

        Many of we newer analyst firms refuse to play into this game of contractual review of research as it crosses the line beyond which we stop being independent and objective research and advisory services firms. It also tilts the markets because the power of a very large vendor to control industry analysts creates an unfair situation for smaller vendors that do not have similar power to influence the written research of industry analysts.

        It is time for change. I hope business and IT increasingly will demand to know if some vendors have edited and changed research that assesses or rates them as a vendor or in some other way put their thumb on the scale. Maybe the answer is for analyst firms and analysts to disclose when research has been reviewed and edited by a vendor before it was published or if it was paid for advertising disguised as a blog. We take the opposite tack, declaring that our Value Index research on vendors and Benchmark Research on buyers has not been edited or reviewed by vendors and we do not allow our blogs or research notes to be scrutinized by vendors before they are published. If we make a mistake that is factual, then we correct it. Our goal is just to ensure the best possible research and insights from our firm that is independent, not skewed by technology vendors.

        I, Mark Smith, approve this message and verify that this article was not reviewed, edited, paid for or approved by any technology vendor before it was published.


        Mark Smith

        CEO & Chief Research Officer


        Mark Smith
        Partner, Head of Software Research

        Mark Smith is the Partner, Head of Software Research at ISG and Ventana Research leading the global market agenda as a subject matter expert in digital business and enterprise software. Mark is a digital technology enthusiast using market research and insights to educate and inspire enterprises, software and service providers.


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