Thought for the day: Analysts face a shakeout

Analyst firms are learning that they have to meet IT bosses' needs, says Duncan Chapple.

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Analyst firms are learning that they have to meet IT bosses' needs, says Duncan Chapple. 





Until recently, analyst firms such as Gartner and Ovum controlled the complicated triangle between technology users, suppliers and analysts.

Now IT directors hold sway. Many analysts have been wounded by their backlash. Only firms that focus on the three Rs - responsiveness, relevance and realism - will survive.

By spending less on generic research and more on tailored advice, IT chiefs are forcing analysts to work more responsively. That hurts houses such as IDC, Forrester, Datamonitor, Jupiter, Aberdeen and Hurwitz that have traditionally struggled to give tailored advice to IT directors.

It also forces analysts to be more relevant. Forrester's value leapt earlier this year after it bought Giga, a firm that serves IT directors better. Similarly, Datamonitor recently bought Computerwire and IDC bought Meridien Research.

Consequently, analysts that mainly serve IT suppliers, such as Jupiter and Hurwitz, are disappearing. Many IT directors believe those analysts often just rehash the views of suppliers. In contrast, Gartner grew its consulting revenue by 4% this year by focusing on users' concerns.

Ovum and Giga responded by publishing strict independence charters. IT suppliers must now work much harder to convince tough analysts who view them through critical eyes.

Looking forward, IT directors' demands should also rebalance the US bias displayed by many analyst houses. As they seek to be more relevant to European IT directors, the best firms will aim to differentiate their material from an industry that largely told Europe to copy the US. Having been over-optimistic year after year, the analyst community is also becoming more realistic.

In the long run, everybody should win - the user community will get solid advice, suppliers' claims will be more believable and analysts will offer more value.

What do you think?

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Former Ovum analyst Duncan Chapple is director of Lighthouse Analyst Relations

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