ARmadgeddon predicted accurately a while back a concentration of the IT analyst research firms market was to happen.
In the last 18 months and in random order, Yankee changed hands, Aberdeen is now owned by a marketing company, Ovum went public, acquired RHK and Orbys... and now it they're about to be eaten by another big fish in the name of Datamonitor who themselves acquired Butler.
We can't wait to read former Egghead Duncan's analysis on this, including on how much Chris Dines and co made in the process...
ARmadgeddon's take: this curious Finchley-Hull-Farringdon menage-a-troie might be interesting if they can sucessfully cross-market their research and drive deeper into RAS for users. Datamonitor is strong in banking and consumer, Butler sort of ok in technology but have a successful events business and Ovum is strong in public sector and telecos. All 3 combined can be a reasonable leader in the UK with revenues over £50m and gain significant market share with end-user. However, the Datamonitor needs a stronger US base to be able to successfully target US technology vendors and compete with the Gartner borg.
PS: thanks for all those pinging us the news...
Update: Duncan published a glowing commentary on this acquisition (he's a shareholder too), we received some other comments hinting that an international merger with a firm like IDC might have been much better for Ovum. We still think that a strong end-user base is necessary to gain independence and respect, let alone to compete with Gartner.
Friday, 20 October 2006
Datamonibores penetrates the gametes
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38 comments:
To find out how much all the Ovum Directors made, I believe all you have to do is read the formal offer document (look under section 8 at http://www.investegate.co.uk/article.aspx?id=200610200700357738K) and multiply the number of shares by 3 pounds...
As one of the more senior ex-Datamonitoreans, I've also had a few thoughts on this. See: http://disruptivewireless.blogspot.com/2006/10/technology-analysts-consolidate-too.html
To be honest, back in 1999/2000, I was strongly advocating that the Tech practice at DM pursued more of a classical telco/IT analyst path, rather than focusing too heavily on vertical market analysis for IT companies. Nice to Mike Danson's finally agreed with my point of view, seven years later....
Well I am happy to be getting 3 quid a share but sad to see Ovum go.
It was to be expected after the IPO didn't make the founders rich. But I am a bit suprised to see Ovum ending up under the same roof as Butler...
Hopefully though somehow this will work out for the analysts - there are some really outstanding people there.
Great news for everyone else. Ovum and Datamonitor is a terrible match. What is Ovum doing besides cashing out? They were just getting there with some sort of offering. Datamonitor is a terrible company, the analysts hate working there and the research quality substandard, despite a modest healthcare practise. Please weigh in .....
Surely it's a curious Finchley-Hull-Farringdon-Boston menage-a-quatre?
http://www.summitstrat.com/assets/contacthome
I visited the DM offices in Finchley once - what a bunch of stuffy arrogant Brits. Heard the place is a political back-stabbing hell. WTF is Ovum doing? The only employee-owned research company with some values selling out to those assholes? They'll end up as a third-rate version of IDC.
This is a disastrous move. Ovum was one of the most respected companies in the industry (look at their renewal rate)Datamonitor a load of used car salesmen. I suspect a lot of ovum analysts will be on the job market very soon, especially if they datamonibore decide to begin exrcising their appalling grind-em-up and dump 'em management "practises" on Ovum. Shareholders are advised to ask Mike Danson about his staff retention rate and why a knowledge based company with 700 staff doesn't have an HR director.
Just read Duncan's blog piece that you link to here.....
I think as usual he is being less than open. He makes no mention at all of Fiona Glennon the Director for Sales at Ovum...thoroughly disliked, and somebody who has tried to lower standards ( to increase revenue ) and make Ovum more like her last firm.....Datamonitor!
The only thing good about this is the share price. Really expected better of Ovum than to sell out like this.....
I was surprised to see Ovum sell out so soon but having used both Datamonitor and Ovum content I would say they are well matched - Ovum has some great analysts but Datamonitor is strong by vertical esp financial services tech and its electronic delivery is much stronger than Ovum
Agree with Anonyomous 20/10 00:00
I've yet to meet a technology analyst at Datamonitor who enjoys it there, other than the Directors who are ALL overpaid arrogant backstabbing psychopathic idiots. Datamonitor are "successful" because they are a factory for churning out reports and they have an aggressive sales team. Analytical insight? my ass. The only good thing that they come out of this is that Datamonitor's technology management team might be replaced with Ovum's.
The comment about Fiona is a bit unfair. She is not enforcing a DM-style regime.
I agree with the rest of the anonymous comments.
It is unlikely, alas, that DM will let 'liberal'Ovumites run their Victorian-style factory.
That's funny: someone criticises me for being "less than open", but is anonymous. Pardon me while I fall on the floor laughing at the irony.
They don't even know that Glennon is COO at Ovum (See http://www.ovum.com/about/biogs/default.asp?page=fiona.htm) - a slightly different role from being "Director for Sales".
I don't think that a report about the merger is either strengthened or weakened by mentioning Fiona. I think a key factor here is that Ovum has, for some years, emulated itself on Datamonitor financially, at the very least. I'll write more about this.
Duncan.
P.S. Isn't any blog where terms like "overpaid arrogant backstabbing psychopathic idiots" are used just losing the plot?
"I visited the DM offices in Finchley once"
They don't have offices in Finchley. Their London offices are on the Finchley Rd.
Perhaps you visited a bunch of doppelganger working under an assumed name?
Got to agree with Duncan on this. I also had a blog-comment tussle with (I suspect) one of the same anonymised & disgruntled contributors.
Some history might be useful here - the company was originally set up by people from a strategy consulting background. Basic tenet - employ young & very smart people (yes, not always with much industry experience), pay them quite well, work them hard, see which ones naturally rise above the background noise & promote them. Others tend to drift away of their own accord. In some ways, it's similar to the "up or out" HR policy of a McKinsey or a Goldman Sachs.
Also, I would have thought that anyone smart working in the tech analyst relations field would also know that "anonymous" doesn't mean "nobody can find my IP address" (libel lawyers, for example). It would also not surprise me if half the anonymous comments came from the same person.
There are two main aspects of the deal to take into considerations: one is financial and the other operational. Perhaps, from Duncan's perspective, it is merely a financial transaction and therefore comments should be limited to the financial aspect of the deal.
I don't think it should. The operational side is equally important, because it will determine whether Ovum will continue to provide valuable products and services to its customers (those of you who don't think it does, you should voice your concerns to the relevant analysts and account managers; they listen, most of the time). My understanding is that this is very relevant to this blog.
Ovum markets itself, or rather its people, as friendly, intelligent and approachable. At least, that's the official line. Those attributes don't really apply to Datamonitor, which does not market its people, only its products (pay attention to the use of 'product', 'people' and 'service' in press releases and presentations if you can). The style of research is very different and the two companies operate very differently at a micro level. Yes, they do. No, really, they do.
Is the deal good news for research buyers? Will Ovum customers welcome the addition of DM products to the Ovum offering? Let's not forget here that DM is buying a loyal customer base.
My feeling is that it will be a good deal with independents like Neil WD, not for Ovum.
Emotional reactions to the deal are to be expected and perhaps the violence of the comments discredits some of the claims made by their author. However, the comments have their place on this blog. This blog often talks about people, analysts in particular, not just companies. Perhaps some of the comments will encourage customers to ask questions that may influence their purchasing decision. That's a good thing.
Having said all that, for those that have suffered at the hands of DM management, and there are lots of them given the turnover of staff, writing and reading those comments is all part of a therapeutic and cathartic process. Anyone want to comment on the following topic: ‘Datamonitor analysts: barking mad or raving lunatics?’ ? :-)
Not the accused anonymous
Duncan you are a PR person, paid to say nice things to people. The posters here have real jobs that would get them fired if they did not comment anoymously...
In your post you lambast the anoymous poster, then go on to validate their comment that you failed to mention the COO of Ovum being from Datamonitor....
You are a smart guy, but you don't always do yourself a service here.
I find Dean's comment fascinating. Why can't he accept that other people may not like Datamonitor? It's rather odd. If it was so good and so well paid, why did he leave?
It odd that an independent analyst would want to appear to be so indoctrinated.
Does Sir Bubley still do freelance work for Datamonitor from time to time?
No, I don't work on a contract basis for DM at all; haven't done so for 3 years in fact. Used to do a bit while getting Disruptive off the ground. More likely to subcontract them, the other way round, these days if anything.
And I completely understand why people may not like DM - it's absolutely not for everyone. I used to screen out a lot of people during interviews on cultural fit. And yes, it can be an infuriating organisation at times.
It's not really relevant to the discussion, but I left (on friendly terms) to work in the City as an equity analyst, which at the time (bubble-peak) was better-paid than any industry analysis firm. I turned down a headhunter's approach for a senior position at Ovum, incidentally. I also had issues with the amount of "process" stuff I had to do given my seniority at DM - too much time in meetings, managing juniors, petty bureaucracy etc. Lastly, I found a lot of the vertical market research boring, even though it sold well & was done competently.
Indoctrinated? yeah right, you've obviously never met me. However, I'm vaguely supportive because I learnt a huge amount there despite the occasional friction, I don't compete with the company in a meaningful way now, I still have friends there, I know it better than most observers, and the current level of vitriol seems unnecessarily bitter.
It's interesting that there's been no complaints (or general tales of woe) from Butler or ComputerWire folk.
Butler couldn't sink any lower..anything for them was up. As for ComputerWire who knows????
Ovum should have merged with Yankee when it had the chance. Yankee has a strong US presence but is weak in Europe - Ovum the exact opposite. Yankee is the king of US telco and wireless but weak in IT, Ovum has a good IT practise, and is the king of European telco. Shame... well life goes on I s'pose. Ho Hum
"Anonymous" has it wrong here. The only thing that really matters here is total shareholder value. Anyone could have bought Ovum, but only Datamonitor paid anything like the value of Ovum's potential future growth opportunities. For a while at Ovum, my desk was a few meters away from the CEO's; even then there was a regular flow of calls from potential buyers. Many of them would check in regularly to see if there was any change. Honestly, Ovum was a firm whose shareholders were very interested in getting bought, but Chris Dines' team worked quite hard to drive up the valuation for shareholders. Datamonitor has the skill, stability, funding and, dare I say, small shopkeeper mentality needed to make these acqusitions work. They won't merge Ovum or liquidate what makes it different, any more than they have done with Verdict or Butler.
Dean's summary of the culture at DM sound on the money to me. Someone once called it an Oxbridge sweatshop, which is especially right on the sweatshop bit -- as anyone who has been there in the summer can confirm. It's business casual there because it's the hottest office I know; you'd faint wearing a suit.
By the way, I've never done PR. I understand that anyone with a gruge against Ovum or Datamonitor will find it easier to suggest that anyone who doesn't hate them must be being paid, but it's not the case. My business analyses the analyst industry; neither vendors nor analyst firms pay us to promote them. I'm not paid to say nice things about anyone, but my academic and professional background does encourage me to counter one-sidedly bitter approaches.
Butler group is 4 people. How many of them are going to complain anonymously without being fired? Computerwire? 15 people left? Was much bigger when it was taken over. Datamonitor Technology is about 30 analysts in a grotty building on Finchley Road. Ovum about 150 in central london. That FIVE TIMES as much manpower. At what stage has Datamonitor ever done something on this kind of scale before? Anyone else have alarm bells ringing yet?
Duncan, though I usually agree with you I think its also about ethical standards in the analyst domain (something of an oxymoron at times!).
Ovum, set a high standard most of the time (particularly when you and I worked there) - one that was typically much higher than the competition.
If you are owned by the same firm that owns Butler etc, no matter what you do things will have changed in the eyes of buyers and users alike - and also for the analysts themselves.
We can all agree its a good day for the shareholders (both you and me included) but a not an all round positive event. Pretty safe to say many Ovumites are not exactly over the moon about this change in ownership.
I am a realist most of the time and realize that Chris and the Board have worked to do their best for the Ovum shareholders, but the perspective from the analyst position may be somewhat different.
Datamonitor does have a Human Resources director. Alas, he is to HR what X-Factor is to music.
Dean, if you honestly don't know why there's so much bitterness at and towards Datamonitor you perhaps someone's ghoing to have to tell you. Funny how people who pride themselves on their analytical strengths fail to analyse any situation with people isn't it? For those who don't know Dean he was co-founder and consulting director at datamonitor technology and had a large influence on the shape of the unit and its culture. If you don’t know him you'ld be excused as he's hardly an earth shaker now as an independent analyst.
Dean has sought to publicly defend an organisation whose creation he was instrumental in. In the comments above and elsewhere hes clearly being more than 'vaguely supportive' as he puts it. However, his published views on the matter as someone who claims 'to know it better than most observers', both here and on his own blog, bear very little resemblance to reality. Unfortunately he has also decided to pepper his entries with comments of breath taking arrogance. Sorry in advance for the long entry but there are quite a few and Dean's going to have to have this made very clear to him. But you'll excuse me a couple of cheap shots before I get to the meat:
'"anonymous" doesn't mean "nobody can find my IP address" (libel lawyers, for example)'. Is that a threat? You don't take criticism well do you Mr Bubley? So much easier to dole it out isn't it? It must be change, receiving cheap sarcasm, rather than giving it.
'I turned down a headhunter's approach for a senior position at Ovum'. That's not at all the same as Ovum offering you a job, which I'm sure you want readers to infer. I'm afraid that just means a headhunter, completely independent of Ovum, phoned you. Big deal. You're still a nobody.
'In some ways, it's similar to the "up or out" HR policy of a McKinsey or a Goldman Sachs.' Good God!!! You honestly believe that Datamonitors people policy is even remotely equivalent to two of the most respected companies in the world? These companies (generally) work by taking a limited number of very bright people, paying far above the average, giving military training, and then aggressivley pushing them commercially before asking them to make a decision to go "up or out". Datamonitor did none of this apart from the final decision which the company made for its own people. Many went "out". Especially if they weren't british white public school educated or "hard drinkers" I believe? I know Dean that you had nothing to do with that directly but it says a lot about the organisation you helped build and its senior staff. The business was devoted to taking fresh graduates shoving them into high stress projects where they had to bluff some sort of expertise (21 year old language graduate and a world expert on mid-office banking systems? of course you are!!!!) and then hope they would leave within 2 years. In the meantime you wring them dry for reports as fast as possible. If they didnt leave they were forced out. Datamonitor has never had any interest in fostering any sort of culture or sharpening its abilities the same way as McK or GS do. Only a completely blinkered fool would say this doesn't matter as long as they make money. Rather than invoking Goldmans, perhaps Bernard Matthews battery farm would be more appropriate.
'More likely to subcontract them, the other way round, these days if anything'. Say what? Are you saying you have a business relationship with Datamonitor? Doesn't that mean you're actually NOT an independent analyst at all? Is it smart of you to admit this on a widely read AR blog?? Unless of course its not "subcontracting" its dumping work you can't do or don't have time to do. What could possibly be the reason for passing on work to a rival? Dean, you need to clarify this as I won't be the only reader to put 2 and 2 together to make 5. But if you do still have a relationship with datamonitor, then you cant claim even the slightest objectivity or independece. If you merely wish to have one, then your fantasy shouldnt be shared. If the phrase has no
foundation at all, you should be the one worrying about legal action from DM! In any of these cases your "vague support" is a sham.
'I don't compete with the company in a meaningful way now,' Your own website advertises expertise in Wireless/Mobile, Networks/voice/telecoms and Enterprise IT. How, to potential customers, is this different from what Datamonitor Technology does? Let me guess. Its more disruptive and strategic? And if you don't cover the same areas, how on earth could you hope to subcontract to them?? and what exactly could you subcontract?
"I also had issues with the amount of "process" stuff I had to do given my seniority at DM - too much time in meetings, managing juniors, petty bureaucracy etc." So let me get this right: a DIRECTOR who doesn't like managing people. Note: people, not 'juniors'. Can you see how some that some of the ex-'juniors' might find this patronizing? do you know how many read this blog regularly?
It seems clear from Dean's own admissions that Datamonitor has an aggressive and ruthless 'culture'. Nothing wrong with that, its common to many industries. But you don't see hedge fund managers or commodities traders complaining, do you? So my guess is the money wasn't that good at all, and the work wasn't that stimulating or had that much impact on anything other than Mike Dansons wallet. And how thankful has Micky D been to his analysts? Are you really surprised so many people who have worked there hate the company? that they spent most of their time working in fear, either anxious or eager to be made redundant? angry at being lulled into a company which promised individuals much and delivers nothing? Is the source of this "vitriol" clearer now? And do you think clients don't pick up on this when they meet datamonitor analysts? The anonymous above who refers to DM
managers as psychopaths is stupidly exaggerating. Their not mad at all. They know exactly what they are doing.
I suppose this is all news to you Dean? If you havent picked up any of this over the last ten years then God help you.
Final question: How successful have the ex Datamonitor technology directors been? My impression is that none of them have done that well when they moved on. Many seem to be independent analysts. But they certainly don't appear on the radar of this blog or any of the others who write on analysts or market research. Perhaps they can only excel when part of a club for aggressive, hard-drinking public school boys who fit culturally? their lack of success points at their expertise and the loyalty of their clients. Doesn't make me think that Datamonitor despite close on to 20 years of trying has created a culture which will produce good, innovative and insightful analysis or that it will put the interests of its customers first, if none of the
directors manage to make any headway afterward. What does that have to say about the strength of the DM brand?
The business models of the companies are so different, its amazing the buyout is being taken seriously. Ovum is a knowledge focussed company. It understands that knowledge resides in people which is high risk and makes for lots of politics. It ain't perfect by any means, and you don't have to be inside to see this. Datamonitor is margin focussed volume player. A factory, and one that has to churn people quickly to function. Again, you don't have to be inside to see this. And this wasn't a change in business model that took place when you left Dean, it was always like that. Your glowing approval of the financials indicate you're also happy with the way its currently managed.
Why should it be an issue? Aside from the different management styles the two business approaches require, there are a lot of ex-datamonitor people out there who are actively antagonistic to the company. Many of whom are now research buyers who would either happily cancel datamonitor contracts or would rather get datamonitor through resellers than direct, just to hurt the business. I can assure you that datamonitor is a company where even its potential customers despise it. Could the same be said for Ovum? not remotely likely.
Dean, almost every one of your comments anywhere on this subject has been either utterly wrong, a twisted truth or simple fantasy. From an uninformed observer this would be silly enough, but as someone who was a director and co-founder of Datamonitor technology, worked for them again up until 3 years ago and hopes to/does currently subcontract to them…….its ridiculous.
Your own company motto is the ever-so smug "Don't Assume". Perhaps its sometimes worth remembering this. Don't assume that all the negative comments on this blog and elsewhere are from the same person. I don't believe they are and this is a first (and last) post on this issue for me, but you'll have to take my anonymous word for that. How many of the negative comments about this are by ex-employees do you think? Don't assume you must be right and because you enjoyed datamonitor everyone must have. Many ...even most... thanks to you and your buddies had worse than a rough time. You should especially remember your motto as you compose your reply to this and shove your entire foot into your mouth again. Or, more likely, write to say you dismiss all of this, without putting forward any kind of defence, because there isn't one. Go Dean, entertain us some more.
And yes, this is anonymous too. But then all those datamonitor technology analysts over the years were also treated as anonymous while you and your drinking friends were imperiously dumping on them.
Insane rants aside...
Mr Bubley may very well be an asshole.... but he's right .... i seem to say that a lot about analysts these days :-(
The acquisition is a good thing for Ovum... the two companies don't have major areas of crossover, so the fit is good... I've met Ovum people and they seem smarter than many stateside analysts to me. The deal gives them access to the USA which they really don't have right now.
Is Duncan sulking? He seems to be 'replying' in his blog http://analystrelations.blogspot.com/2006/10/ovum-smart-buy-that-needs-careful.html to points raised on this page.
I have been entertained and amused by the debate on the boards. However, I suspect that we are all falling into the same trap that we often criticise analyst houses for ... being off in our ivory towers making opinions. Some of you may be right, some may be wrong (and I will bet that like analysts the ones who are right will be reminding everyone while those who are wrong will gloss over it!) but have any of you actually talked to Datamonitor or Ovum's current executive teams or is this just idle speculation?
I know some people at Ovum and I heard that Datamonitor execs were in and giving presentations on the offer day (which those of you who know how these processes normally work will know is highly unusual - doesnt sound like a company that doesnt respect people to me but perhaps they are just good at PR). I dont know what they have said in detail though. I also hear that some staff are worried about their jobs, some are cynical, some are even enthusiastic actually.
I dont make a prediction on what will happen because I haven't talked firsthand and I dont want to speculate without information.
However, salvation might be at hand for us all. It does seem that in addition to Duncan's blog above the monibores are out and about briefing people though e.g. http://www.knowledgecap.com/resources/ARIArchive.htm (10/26 edition)so maybe we should invite them to do a Q&A on our board? :-)
The analysts are Ovum are not happy at all about this move, period.
It will take a lot more than briefing a few execs to change that. The execs are happy they have just made lots of money on their shares!
I'm not going to respond to all the comments above. I'm surprised this "debate" has descended to vituperative personal insults. If anyone's actually interested, contact me directly and I'll discuss anything in a civilised & rational fashion.
I suspect my critic's time at DM may not have coincided much with my own. I frequently & openly battled to get the "knowledge" based business model adopted further - see my initial point as to why I thought the purchase of Ovum fulfilled that wish. I also advocated analysts not being pressured to undertake management tasks if they preferred alternative career paths. At the time "Director" reflected tenure length more than role.
Disruptive Analysis has no current commercial relationship with Datamonitor. If a client wants large-scale multilingual telephone research as part of a consulting project, I'd outsource it (ie "subcontract"). Datamonitor is a potential supplier, along with others. No big deal, lots of people do it. Don't Assume.
The reference to lawyers was not about me personally, nor a threat - it was more if anyone might have been aggrieved about the "psycopath" comment and decided to pursue it.
These are the views of an Ovum employee who’d rather govern their own fate than become part of the ‘cost synergies’ that Datamonitor is looking for.
1. Datamonitor has to understand what Ovum's main assets are. Hint: they walk out of the office every night to go home (unless they work from home...). It has to convince us that it will treat us differently from the way it treats its other staff or we’ll be gone. I will need a lot more convincing, and I’m not alone.
2. Ovum is a special place to work, and few of us want that to change. This is despite the stresses and strains that came with the run up to the floatation.
3. Ovum has several staff who’ve worked for Datamonitor and its subsidiaries. Most of them are dreading the Datamonitor take-over. And they certainly don’t want to go back to Datamonitor’s pay levels or employment terms. Indeed, Datamonitor is a company that no current Ovum employee would ever think of moving to work for.
4. Sadly for Ovum staff, it is the duty of the Ovum board to look after the financial interests of the shareholders. The interest of the staff is only considered when that consideration aligns with the interest of the shareholders. But when the two diverge, it’s the shareholders that the board has to look after.
5. Since Fiona G’s name has been dragged into this and she can’t defend herself, I ask you to remember that she is obliged like the rest of the board to fulfil her responsibilities to the shareholders and keep her personal views to herself.
6. There’s talk of raising enough ‘no’ votes to stop the acquisition going through. Idle talk this may be, but some staff will either abstain or vote 'no'. We don’t know how many, but if the ballot is secret it could be quite a lot.
BTW, Ovum does have a growing US presence; we bought RHK and Summit Strategies. We may not be as big as Gartner over there, but Yankee had better watch out!
RHK and Summit Strategies are not a "US presence"...don't be silly.
My guess is you'll pick off Yankee pretty soon as they seem to be on a slow decline snce their last buy-out.
I do feel for the Ovum staff right now and hope for their sake this dumb merger fails as it will spell the end for everything they have stood for.
Well said, Elsa.
This has been an absolutely fascinating and hugely entertaining discussion but I respectfully suggest it should be put to bed now - it's getting nasty.
Any readers who miss their daily hit of bitchy comments could try "Go Fug Yourself".
Datamonitor kindly asked us to remove comments that were purporting its staff.
Since they were funny, we're reposting some anonymised ones below....
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