Cash for Coverage Accusations Rock Industry (Update)

In what's sure to be a controversial move, John Honovich of IPVideoMarket.info took aim today at rival and well-known security research firm, Frost & Sullivan, and accused them of trading their industry leadership awards for cash. Though no details or specific examples were provided in his stinging critique, John did claim that through "interviews" and the review of "public records," he unearthed several serious problems with the firm’s industry awards.

John Honovich:

The consistent theme I hear from award recipients is that awards are granted at
no cost but the manufacturers cannot publicly announce awards without paying
thousands of dollars to Frost & Sullivan.

As for my own firsthand information on Frost & Sullivan, I can only really comment on the award we received at 3VR a couple of years back (in relation to our searchable surveillance system). In that case, I can assure you no money changed hands before the award was given or since. [BIG correction: My head of marketing from back then just called me to let me know that despite my previous righteous denials, we did indeed end up paying Frost a small amount sometime after receiving the award to "promote and market" it. My former VP wasn’t clear what the consequences might have been if we had simply announced the award on our own without paying Frost for their active involvement, however. Someone from Frost should really weigh in to publicly clarify this point for the sake of all its award recipients.] Regardless, I think that research firms, and the companies they cover, would be well served through clear disclosure any financial ties when they do exist. Without this modest transparency, the influence of these kinds of awards will inevitably diminish.

John Honovich seems to conclude something similar:

Awards are important and trust is crucial. If we are going to have awards that
claim to judge and identify the best companies or products in the industry, we
need to be confident that the judges are doing so fairly and with the interest
of the community. Frost & Sullivan and the award recipients should be
clear about their financial relationship and the process of selection so that
industry professionals can assess these awards appropriately.

Bravo!

But, big research isn’t the only one out there with conflicts of interest. Of greater concern to me today is the emerging trend of some manufacturers to directly compensate individual security analysts and other perceived independent voices in our industry. In some cases, bloggers even provide regular coverage of these companies while kept under monthly retainer…without providing any disclosure of the financial relationship. Kept secret, this kind of ongoing direct remuneration of content creators can’t help but engender the worst kinds of bias and conflict of interest.

So, whether John Honovich accusations are proven true or not, let's hope that they spur a movement to greater transparency industrywide. Whether you are a blogger, analyst, author or part-time journalist, if you’re getting a W2 or 1099 from a company you're covering, you should be disclosing it.

How can you claim any credibility on any issue if you don’t at least meet that low bar?

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Stephen Russell gets regular paychecks from 3VR Security and should be considered hopelessly biased when it comes to topics relating to the company.