Rob Enderle weighs in on NY Times ban

They need help

Comment Ashlee, I read you piece (NY Times bans Microsoft analysts from Microsoft stories) over the weekend and man did you hit a chord with me. I sweat this stuff. I’m accused quite often of being a Microsoft shill and, as you point out, there is actually a cottage industry that has cropped up making that accusation to keep me from saying anything negative about OSS (open source software) or Apple. Since I’ve been doing the analyst thing for well over a decade, I think most journalists know I answer questions as honestly as I can and, while I do make mistakes, they are honest ones.

But the big firms are under heavy financial strain from the Internet. More and more IT shops are coming to the conclusion that they don’t need to buy research from a large firm because they can get the same data, or sometimes even better data, off of the web. Vendors are getting tired of being blackmailed into buying consulting and services they don’t need, and many of the more experienced analysts have either opened their own practices or have gone to work for the vendors or IT shops who then, and you can understand this, feel little need to work with the remaining junior folks.

It used to be that there was a hard break between the analysts and vendors, but with increasing revenue pressures a substantial (20 per cent to 50 per cent) of their income now comes from consulting and the majority of that is with vendors. Vendors don’t like to consult with folks that are negative about their offerings. It puts the analyst in a horrid conflict of interest and the reason I created the “bad report” service, which has never actually been used, was to offset an increasing practice of using negative reports to “encourage” vendors to buy research and consulting.

With regard to disclosing clients, I do that on my web site, but don’t on my columns anymore. Like you, I thought the idea was a good one and Ziff Davis agreed (this is where you’ll see it was tried). But if I was negative about Open Source or Apple, instead of people being grateful for the disclosure, it actually fueled the fire and folks went ballistic threatening to boycott my clients or worse, and you’ll notice that Ziff generally doesn’t do the disclosure thing anymore as a result (it looks like they have actually removed it from many of my old pieces).;

Ziff, like most of the folks I work with now, wanted controversial pieces and it wasn’t in either of our interest to make it look like the pieces were vendor directed (the goal was generally to drive web traffic but the opinion remained my own). I did really like that Acer Ferrari notebook, and it drove a lot of my peers nuts (and some still give me good natured grief about it). I get excited about cool hardware and have a passion for it; folks seem to like it when I write about things I’m passionate about. Go figure.

Even with the Ziff experience, when the Times brought it up, I said I had no problem if they treated all of the other analysts the same way. I simply didn’t want to be singled out again and most of us have as clients the companies we are most conversant with. More important, I was aware that about a decade ago the firms put a lot of the independents out of business by spreading the rumor that the independents couldn’t be trusted and I really didn’t, for obvious reasons, want to do the same thing myself.

I do think, however, that if an analyst has consulted on a project that the reporter is asking about they should disclose that because they may be critiquing their own work and if the analyst has an investment in the company that should be disclosed as well for obvious reasons.

Paul Gillin, who weighed in on this subject as well and later did a quick search on how many times the New York Times quoted the Aberdeen Group after their business model was outed by the Wall Street Journal in 2002.

I honestly don’t know what the right answer is here. When I write, I like to pick controversial topics which means it isn’t unusual for me to get folks excited. The end result is also my work and not my words supporting someone else’s (a lot of folks don’t fact check in context anymore and that can be problematic for me). All I can say is; I do my best when called by a reporter or client to answer a question in the most complete and honest way I can. When I first started out, the news services actually paid for this. Now I support them because it helps me think through issues (and I enjoy it), they actually give me great market intelligence, and it showcases that I am capable (at least some of the time) of giving good answers to complex questions.;

You’d think the Times would have had enough controversy about their credibility. I guess not, well at least the Washington Post is happy.

From the heart I really appreciate your doing this and if we can get some consistency in the process and maybe get folks asking the right questions about vendors and analysts, I honestly think things will improve for my industry, I know they would improve for the New York Times.

Rob Enderle, Principal Analyst, Enderle Group

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