Should Industry Analysts Disclose Clients: My Commitment to You

Rob Enderle

The reason I don't mention any of my clients anymore when I write is because it implied a bias that doesn't exist, or I should say, it implies a source for bias that isn't accurate. It also reinforces the belief that people put words in my mouth, and given that has never been true, I don't see any point in doing that.

 

I, and my editors, do pick controversial subjects and try to attack them from unpopular positions. I do that not to drive purchase decisions; in fact I seldom recommend products, but to help people think through issues. But, when you say things folks don't like, I've learned they will not only attack you, they will attack your income, your family, and your reputation (often in that order). I don't think that is right and I don't want anyone else taking the heat for what I write. I assure you it is all me, it may be dumb or idiotic or even biased, but it isn't bought. And I won't imply otherwise.

 

At one time I too thought client disclosure should be a practice for industry analysts and when I first started writing for Ziff Davis all clients were listed. At the time I believed in the practice, but that list then became what people wanted to attack and instead of staying on topic. It became a problem for both Ziff and me, and, if you look, you'll see they don't do it anymore with anyone either.

 

Financial Analyst Assumption was Wrong

 

The reason financial analysts have to disclose is because they were caught lying. And they have to disclose not their clients, but companies they have invested in. For instance, if a company was using them to help their own investments that doesn't need to be disclosed. They only need to disclose companies if they actively trade in the company's stock. The trigger for this was that during the HP Merger one of the firms who came out public ally for the merger was against it privately and was both connected to the event financially and got caught.


 

There has been no similar event for industry analysts, and even though every firm and most independents have Microsoft and others as clients, we are hardly, as a group, accused of being overly positive about any vendor particularly Microsoft. There is one company that is clearly an exception, but that is because they make a business out of writing marketing collateral for vendors and they really should be thought of more as PR than industry analysts.

 

I do think investments in a company should be disclosed and don't maintain investments in any in technology companies for that very reason.

 

Bias

 

What we are trying to get to with rules like this is the disclosure of BIAS. But that can have causes much deeper than a client relationship. Take Linux for example: there is no Linux company to work for or have as a client (to be clear I mean no company called "Linux", there clearly is Red Hat or Novell, but I'm talking about bias that would apply to contributors), so no related disclosure would even make sense. In case of the folks who have a pro Linux or Apple Bias, what do they disclose?

 

Perhaps the disclosure that they personally hate Microsoft or contribute to Linux would more accurately identify bias, or perhaps that they simply hate rich people and think Bill Gates should be stopped. Maybe if we required every writer tell their entire life story that would properly and completely identify their bias.

 

I had one guy last year, after I called HD-DVD the winner of the High Definition disk wars, say I only did this because Microsoft supported HD-DVD and it took another reader to point out he was one of the leading Blu-Ray advocates.

 

A few years ago I wrote a piece favoring one vendor over another. I got a call on my drive home from a guy who said he was an IT manager and that I was dead wrong and should print a retraction. After pounding on him over the phone he finally admitted to working for the vendor I hadn't favored, he'd lied about his title and his employment. Employees do this all of the time in posts and they are really hard to catch.

 

We all have bias, it comes with being human. The trained analyst, because it is actually part of the post-graduate courses in market analysis (something that isn't a requirement to be an analyst), is supposed to factor their bias out. In fact, in a formal report you are supposed to identify the bias and what has been done to eliminate it. I should add I haven't actually seen this done since I left college.

 

You should realize however, that this isn't an analyst report; it is a blog, and unbiased blogs are kind of dull. If you don't take a position what do you write about, really?

 

Apple and Linux Attacks

 

Both Apple supporters and Linux supporters use as their primary response to anyone writing something that isn't positive about their preferred platform that they are paid by Microsoft, whether it is true or not. In fact, I'm not even sure they really care. It is interesting, though not surprising, to note they virtually never identify who they are or who they work for.

 

I've never been anti-Linux; I've been against the abusive behavior of Linux supporters and take consistent exception to the same behavior from Apple supporters. I think anyone who, in their role as IT managers, chooses a product for any personal reason rather than what is best for their company should be fired. The very first thing I wrote on Linux said exactly that and used a real CIO who choose Linux without even bothering to see if it was the right choice for her company as an example.

 

To be clear, in terms of sequence of events, I started pointing out the faults in Open Source and Linux before Microsoft was a client. In fact, to be able to do this was one of the primary reasons I resigned my job at Forrester.

 

As the Senior Research Fellow I didn't feel there should be any topic off of the table for me. I saw that as part of my job, but Forrester disagreed and, because this initial column had created a lot of controversy, I should point out that when my management read it they didn't disagree with the work or the findings (I should point out that virtually everyone who took exception to this column hadn't actually read it), I was told to leave that subject alone. I disagreed, and I'm free to talk about any subject I choose today. And, I'm sure not going to let a bunch of Linux or Apple fans have the power I was unwilling to give to my employer.

 

If I have a bias it resulted from massive, and unfounded, personal attacks not from anything connected with Microsoft.

 

Perhaps I should simply disclose at the end of the related piece that any bias may be the result of personal attacks and threats against my family from OSS and Apple supporters. That actually doesn't happen that much anymore, though, and I sure don't want that to change.

 

Free Speech: Open Discussion

 

I feel strongly that people in my position should be free to raise objections and to point out potential problems. I'm aware that when that doesn't happen you get things like the disaster that was client/server computing in the '80s (which we later found out was a train wreck) and we get the mess the U.S. now has in the Middle East.

 

It's difficult for any of us to get around the accusation of bias. One of my editors, when challenged by readers on my work or the work of any of my peers, with regard to bias, asks the reader to point it out. Specifically to showcase where the argument was poorly formed or clearly slanted in the direction they contend. According to him, none of them respond.

 

The Trigger Event for this Post

 

Recently, and what prompted this post, was a discussion on the Linux brand and how the lack of clear ownership had allowed it to be positioned as anti-American. I took the position that the positioning of the brand in this was probably going to damage the product and that brand ownership that people who used the technology should be prepared for questions that might result.

 

In this instance the trigger event was news coverage on a Cuban IT event which became political and anti-American and how Linux was positioned at the event, not by Microsoft, but by one of the leading Linux spokesmen and the Cuban minister as being anti-American. To show bias you would need to show why someone reasonable and independent from either side would have concluded differently, in other words that a reasonable person would think that connecting Linux to an anti-American movement was a good thing. I'd love to see that. Really, I would love to see that argument made.

 

This is About Being Honest

 

Because folks can't seem to challenge the argument they instead attack personally by calling names or to suggest the opinion is paid for. This is similar to the U.S. President saying that the reason the Democrats are against the troop build-up in Iraq is because they are running for office for the opposing party.While their running may be true, his statement keeps him from having to argue the points they make and they clearly need to be argued. It is effective, but I don't think it is wise, because it covers up rather than fixes problems that could be real. I think it is in our best interest that the points be addressed.

 

One final thought on this subject; let's take Oracle as an example. Let's say I post a piece that says Oracle is executing very well and that they manage their brand better than any large IT company and then say they are a client. That implies what I said wasn't true, even though it clearly is, lowering its impact.

 

Now let's say I write that Oracle is often considered by IT buyers as an opponent and that at least one has said something to the effect, "we don't know who Larry's enemy is, but we're afraid it's us," which is also true, and I say Oracle is a client. One, they probably won't be for long, and two it makes it look like I'm personally attacking a client. The false implication in both cases is that Oracle is somehow responsible for the post.

 

In the end there are three reasons I think an analyst shouldn't disclose their clients: One, it puts the clients themselves at risk; two, it implies bias that may not exist; and three, it probably has nothing what so ever to do with whether what was written is accurate or not. The exceptions are, if a vendor is paying for the piece, that needs to be disclosed, and if the analyst actually contributed to what they are commenting on, because they are commenting on their own work, that too should be disclosed.

 

In short, if a disclosure increases the accuracy of a message it should be done, if it decreases it or causes unneeded harm, it shouldn't be done.

 

My Commitment to You

 

I'll be as straight as I can be with you, but I'm human and can be tricked or misled or simply confused and will probably make mistakes. In other words, I'm not going to pledge to be anything but the best I can be. You'll get some of my best work, but I'll probably have bad days. If you post a question, I do my best to give you an honest answer and will work very hard to keep it out of the weeds or from being personal.

 

I may respond in kind to personal attacks, but will make every effort to keep from initiating them. I'll even take suggestions, if you think there is something that isn't being covered, particularly if you think people are afraid to cover it, bring it here and let's see if we can't at least talk about the fear.

 

I won't pretend to be Dr. Phil, but I am committed to keeping the kinds of problems that happen because people are afraid to bring up subjects that should be discussed from happening. The need for that, particularly here in the U.S., has never been more clear to me.



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