This is a story of a small-time vendor who, after years of being stepped on by a billion-dollar analyst firm, throws open the windows of its San Jose office and screams, “I’m mad as hell and I’m not going to take it anymore.”

The question is, will anyone else join them?

ZL Technologies, an email archiving company who has languished in the niche corner of Gartner’s Magic Quadrant for four or five years, is suing the analyst firm for $1.6 billion, claiming defamation, trade libel, unfair competition and negligent market interference, etc.

Gartner contends that it has a First Amendment right to express its opinions on technology markets. It’s hard to argue with that.

As I have mentioned before, there are many people who dislike Gartner and its influence over the IT industry and claim that its Magic Quadrants are more about who you know and what you spend with Gartner than the quality of your product and your company.

My colleague Mark Fontecchio did a nice job of collecting some reaction to this lawsuit from the people who matter: IT decision makers.  It’s clear that for all the ridicule that bloggers, out-of-favor vendors and competing analysts heap on the Magic Quadrant, the market measuring tool still has significant influence over buying decisions. One IT veteran said the Quadrant represents about 20% of the decision-making process while another said a CIO should always review a Quadrant with his CEO before buying a product.

IT executives have a fair amount of skepticism about the Quadrant but they still rely on it to some degree. Every time I write about one, the page views come pouring in. Cisco might be the leader for the 100th time in a row for enterprise Ethernet switching or wireless LAN, but everyone still wants to know the nitty gritty about the Quadrant.

So what could Gartner do to reduce criticism? Well, how about more disclosure? Exactly how does that magic box get drawn up? Maybe the mathemtaical model should be disclosed. How much money does each vendor on the Quadrant spend with Gartner?  How many hours has the analyst spent with each vendor? How many customers of each vendor were consulted? These are facts that inquiring minds want to know.

In my 14+ years at Gartner, I have never, ever allowed a vendor to influence my opinion with anything but facts. Period. They have certainly tried to influence me with non-facts. I can say this definitively – it has never worked.

Tom’s rant has sparked an interesting debate among current and former analysts, bloggers and vendors in his blog’s comments section. It’s worth reading.

There has been plenty chatter in the blogosphere and elsewhere about whether analysts are offering any value to enterprise clients. Many analyst firms, such as Gartner, count both IT vendors and end user enterprises as customers. It’s hard to serve both masters while maintaining an appearance of integrity. This is probably why Gartner has an ombudsman... the only ombudsman I know of in the analyst industry.

Gartner’s use of an ombudsman doesn’t protect it from attacks on its integrity. James Watters, for instance, suggested recently that IBM’s favorable position Gartner’s Magic Quadrant for Web Hosting and Hosted Cloud System Infrastructure Services was due to IBM being a very important paying client of Gartner.  Trapeze Networks came to me after I wrote about Gartner’s last wireless LAN Magic Quadrant and suggested that Gartner had unfairly placed Meru Networks ahead of Trapeze because Meru’s current VP of marketing is a former Gartner analyst and one of the authors of the MQ was very briefly an employee of Meru.

It’s hard to prove your integrity. For some people, there just isn’t enough proof in the world to erase any doubts.  Journalists face the same challenge. In my newspaper days people would occasionally accuse me of being a mouthpiece for politicians. I knew I was doing my best to write fair and balanced stories, but the accusations still stung.

Gartner’s use of an ombudsman is significant, I think, although the office would have more impact if the ombudsman’s blog were updated more than once a month. An ombudsman is the voice of the client (or in a the traditional journalism sense, the reader). Clients will have more faith in a an analyst’s advice if the firm has someone on staff who tackles each and every significant attack on its integrity head-on, in full view of the public.

Gartner and other analyst firms should also disclose the nature of their paid relationships with the vendors that they evaluate for enterprise clients. This way, clients can understand the full context of the advice they are receiving.  Some firms do this. Others don’t.

If you could talk to the CEOs of the leading analyst firms out there, what advice would you give them to help them establish that they are giving unbiased and independent advice to enterprises?

Brian Johnson, director of public relations for Trapeze Networks, called me last week and implied that Meru Networks is receiving favorable coverage from Gartner over Trapeze. Gartner placed Meru in the visionary quadrant for the second year in a row, while Trapeze slipped from visionary status to niche player.

Johnson revealed to me that Tim Zimmerman, one of the Gartner analysts who wrote this year’s Magic Quadrant, is a former employee of Meru Networks. I checked around and indeed Zimmerman was director of industry marketing for Meru Networks from Octbor 2007 to January 2008. Johnson also pointed out that Gartner’s former research director for wireless LAN technology, Rachna Ahlawat, is currently the vice president of strategic marketing for Meru.

Johnson explained that Trapeze has had a good year and is a superior company to Meru. He said it “stretches the imagination” that Meru could be ranked higher than his comapny.

“We have a higher market share than Meru,” Johnson said. “We have more OEM relationships. And we are a public company with a large bankroll behind us while Meru is a private company that is rapidly burning through its cash… In terms of ability to execute, I think that Trapeze has a higher ability to execute than Meru can.”

Johnson also told me that Trapeze brought eight products to market this year and three of them won awards (I looked through a list of press releases on Trapeze’s website and didn’t see that many product releases, but perhaps I missed a few). He also pointed out that Trapeze won the largest wireless LAN deployment in the world this year when it closed a deal with the University of Minnesota.

Johnson was reacting to a story about the Magic Quadrant which I wrote last week. When I talked to Mike King, Zimmerman’s coauthor, for that story, he told me that Trapeze’s downgrade was reflective of its relative silence on the market since it was acquired by Belden over the summer. He suggested that things have slowed down at Trapeze while Belden goes through the process of absorbing it. And he predicted that Trapeze could lose some key OEM partners when its deals with those expire in a few months. All this can be fairly typical for mergers and acquisitions. Motorola experienced a similar decline on the Magic Quadrant when it bought Symbol Technologies, but it has since rebounded and is now identified as a market leader by Gartner.

Now any industry veteran will tell you that analysts take jobs with vendors all the time and research firms like Gartner commonly hire analysts from the vendors they cover. Ahlawat left Gartner for Meru in June of 2007 so it’s been well over a year since she’s had any relationship with the firm. However, Zimmerman left Meru less than a year ago, so it was worth my talking to Gartner about this issue.

First I talked to Andrew Spender, Gartner’s vice president of corporate communications. He said Gartner employs a variety of measures to ensure that its analysts are independent and objective.

“First we have our principals of ethical conduct and our code of conduct which all our analysts sign up to as soon as they join the company,” he said. “They have very intensive training in what that code of conduct means and how they need to adhere to it. It’s very specific in terms of accountability.”

Spender also said that no piece of Gartner research is ever the work of one single analyst.

“When you buy a piece of research or become a Gartner client, you obtain the research from Gartner, not from an individual analyst. Each piece of research is peer reviewed. Our community of 650 analysts have a formal obligation to do peer reviews of other analysts’ research to ensure that any kinds of inconsistencies, any errors of data collection or any errors of conclusions are challenged and corrected before the research sees the light of day.”

I also spoke to Larry Perlstein, Gartner’s ombudsman (Gartner is the only analyst firm I know of that employees ombudsmen), about this matter. He has already conducted an investigation of Trapeze’s complaint.

“Basically I didn’t find anything that made me concerned that there was any real fact in Trapeze’s issues. The analyst that they expressed a special worry about, who was formerly at Meru, was there for only a very short period of time, about three months. It wasn’t clear that anything in that involvement was going to dramatically influence this particular piece of research. Most of our analysts come from vendors. As part of our hiring process we try to ensure that people have the capacity and potential to be balanced and objective.”

On the same day that I spoke to Johnson at Trapeze about this issue, I happened to chat with David Callisch, vice president of marketing at Ruckus Networks. Ruckus is another niche player in this year’s Quadrant, ranked a little lower than Trapeze.

“Tim Zimmerman and Mike King are both very stand up guys,” Callisch said. “I thought we had a pretty mediocre spot on the Quadrant, but to be quite objective, who are we to say? Vendors always think they deserve a better spot… But Tim and Mike did a lot of due diligence. I think they did a good job even if we got a lousy spot.”

He said that Gartner placed Meru high probably because the firm likes the innovative single channel approach Meru takes with its access points, which solves voice roaming very well. He said he has doubts about whether this approach can scale as well as more mainstream wireless LAN technologies, but he doesn’t fault Gartner for giving Meru high marks for their technology.

Callisch went on to call out Trapeze for its acquisition by Belden. He said Trapeze has a very good product line, but it had marketed its technology poorly, driving down the value of the company.

“They ended up being sold to Belden for pennies on the dollar and that hurt the valuation of other [wireless LAN] companies” he said.

Gartner has published some selected findings from its annual IT market compensation study. In it’s new publication, “CIO Alert: Jobs and Skills Topping the Difficult-to-Recruit-For List in the U.S.”, Gartner identified network engineer and network architect as thefourth and fifth most difficult positions to fill. And it’s only getting harder for them to find you.

The percentage of CIOs who said network engineers are very difficult to extremely difficult to find rose from 14.1% in 2006 abd 16.6% in 2007 to 20.3% in 2008.

The demand for network architects has fluctuated a little more. About 18.2% of CIOs said they had a very to extremely difficult time finding engineers in 2006. That number sank to 15.2% in 2007 and then shot back up to 19.8% in 2008.

The only jobs which are harder to fill are enterprise architect, database administrator and ERP programmer/analyst.

Now I know what many of you are thinking. With the economy hurtling towards some sort of apocalypse, will any company be in a position to hire anyone in 2008 or 2009? Gartner does mention in its research note that IT recruitment continues to be a top challenge for IT organizations even in current economic conditions. Of course, this survey data was collected in February, before people starting use the term “the worst economic crisis since the Great Depression” on a daily basis. At least network engineers and architects have a little bit of an advantage over security analysts and bsuiness analysts and… COBOL programmers.

When it comes to enterprise Wi-Fi, the industry’s got enough drama for an MTV reality series, with constant bickering over what WLAN architecture’s better, or which .11n product truly supports PoE, or which skeezy AP went home with a stranger last night.

All this is to say it’s not surprising there’s a lot of back and forth about a rumored Juniper acquisition of Aruba or Meru. Mergermarket.com reported that two analysts and another source think a Juniper purchase is looming, and these two are the likely targets.

Chris Silva, Forrester analyst, had his own theory: Juniper, indeed, was ready to bite, but Aruba is too expensive and Meru might be too weird:

So, there it is, I’m drawing a line in the sand that the acquisition target is not Aruba, perhaps Meru and potentially another, even smaller vendor. Nothing short of hedging on my part, I suppose, but I will say this: WLAN is a logical line extension for Juniper, and I’m not ruling out – but rather expecting – at least one more acuqisition before the year is out.

We followed up with Chris to name names, and he kindly got back to us.

“It’s a tough call,” he e-mailed. “Bluesocket seems to be one of the last men standing. Aerohive is too small and too new and Extricom, while likely a cheaper buy than Meru, is the same technology without the customer list.”

Aruba, however, doesn’t seem to be sitting at home waiting for Juniper’s phone call. They’ve teamed up with Foundry to form a “co-marketing relationship between the companies’ wired and wireless LAN products for Federal customers.” A small step for LAN, to be sure, but maybe signaling a future giant leap (acquisition?) for LAN-kind?

Straight from Aruba’s announcement of the “relationship”:

“This collaboration affords Aruba and Foundry the opportunity to target a sizable Federal market in need of new and replacement secure networking infrastructure,” said Keerti Melkote, Aruba’s co-founder and chief technology officer. “We have steadily enhanced our suite of wired products, including wired remote networking technology, to complement our industry-leading wireless LANs. As Foundry’s first wireless LAN vendor to be designated an Ironpowered Technology Partner, we’re now in a unique position to co-market our products, together with Foundry switches and routers, across a broad range of Federal applications.”

Sounds awfully cuddly to me.

Over the years I’ve recognized that analysts are like anyone else. Most of them know what they’re talking about. Some of them don’t. Sometimes its hard to know when these people who are paid to be the experts on a subject really are the experts they’re purported to be.

That’s why it’s so useful to hear from paying customers of these analyst firms about their experiences. Sam Lawrence, chief marketing officer of Jive Software, a social software vendor,
blogged this week about his experiences with two shops: Gartner and Forrester Research, two of the the biggest IT research and consulting firms out there. He’s assigned them letter grades based on how they treated his company, both before Jive became a paying customer and after it signed up with them.

Forrester scored a B and Gartner scored a C-. Lawrence was happier with Gartner before he became a paying customer. After he signed on with them, its performance declined, according to his blog. Forrester has been relatively steady in its performance throughout.

From my own experience, I’ve found that Gartner and Forrester both have a number of intelligent and well-informed analysts who are always willing to help me with a story. I couldn’t do my job without them. And both firms have very helpful media relations people on staff. In general, however, I’ve always found Forrester’s analysts more accessible on a daily basis. I’m not sure if their paying clients feel the same way, but with Lawrence and Jive that seems to be the case.

Lawrence also offered praise for some of the smaller, more specialized research firms out there, such as The 451 Group, RedMonk, Jupiter, and specifically Mike Gotta, an analyst with the Burton Group who specializes in collaborative technology. I’ve worked with all of these firms over the years, along with Mike and a bunch of other people at Burton Group, and I agree that they’re a big help.

What firms do you depend on to give you expert advice?