Priming the Pump: Pro-revolutionary bias in commercial research

In an email message I received today, the following information was given:

A recent In-Stat survey found the following:

  • 52% of respondents plan to purchase security appliances to replace out-of-date equipment, as compared to 22% in 2004.
  • Less than 10% of the respondents in companies with less than 100 employees have deployed integrated security appliances.
  • IPSs are increasingly being distributed at critical segments instead of concentrated at network perimeters.

This Market Alert is drawn from the In-Stat research, "Trends and Spending Plans for Security Appliances: The Move from Products to Services" (#IN0602882LN), which covers the worldwide market for network security appliances. The report includes forecasts for shipments and revenue by product segments through 2010. It also includes analysis of equipment trends, major product announcements, and end user survey data. The price is $ 2,995 (US).

Source: http://email.in-stat.com/cgi-bin4/DM/y/hyIL0IJrNW0K560DHgc0Ep

Only 44% of the survey respondents reported using IPS technology inline at the perimeter; as compared to 74% in 2004.

One of the themes of this blog is how in the world can we predict the future of new media? Private market research firms produce reports like this (I grabbed it for convenience despite the topic because it demonstrates how these market research reports go). $3000 per copy of a report. Who would pay such a price? Firms that are concerned about security, in this case, clearly a hot topic, might find it easier to purchase this report than have internal employees do the same research. The highlights made public suggest there is a large potential market for "security appliances." What is the report found no interest in "security appliances" and/or all the companies that see "security applicances" have already bought and installed them? Who, then, could justify the expenditure for this report?

As you have read my blog, you know that I have, on occasion, pointed out that optimistic forecasting reports from market research firms should be viewed with a healthy dose of skepticism. If you need more evidence, go back to the late 1990s when even the sky didn't seem to be the limit on market forecasts for "dot.com" businesses. (Kind of reminds me of the "evidence" that Iraq had weapons of mass destruction.) What if I produced a report that says "New Television Technologies Not Expected to Have Measurable Impact on Audience Viewership"? Actually, that's a bad example because it's so counter the prevailing expectations, some copies might sell. My point is that a market research report that screams "Big Market Research Firm's New Report: More of the Status Quo" will not sell well.

I'm listening to the conference call for CNET Networks and I hear the analysts are still using the pop business word "monetize." I might have thought that this word was passe given its ties to the dot.bombs around the year 2000.

You may use this content (better still, argue with me!), but please cite my ideas as © 2006, Dr. Bruce Klopfenstein. Find any typos! Don't smite me, let me know!


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