Layoffs at Gartner and AMR
Carter Lusher at SageCircle reports that industry analyst firm AMR is shedding around 10% of its staff while Gartner is losing 117, or about 3% of its people. AMR looks to be retrenching to core areas while Gartner claims it is not letting any of its sales people or analysts go. Gartner says the cost of shedding jobs will be c. $8.5 million as a Q4 charge.
A couple of names on AMR's list stood out. Jonathan Yarmis was building himself a reputation on Twitter as AMR's 'emerging and disruptive technologies' unit. Lee Geishecker, formerly with Gartner was on the advisory services part of the house. Lee is well known as an expert on Oracle.
As the recession continues to bite, we will inevitably see consolidation of the analyst sector through attrition. Talking to boutique firms, some expect to do well but they attribute that to agility. The larger players - like Gartner, Forrester and AMR are more sensitive to market change, principally because they depend on the vendor community to keep them afloat. I tis for example rumored that Gartner's Spring Symposium will be canclled. If so then this represents a big hole in Gartner's earnings because events are extremely lucrative.
As an aside, the fact AMR is effectively ditching its Web/Enterprise 2.0 business tells me a great deal about the dynamics of that segment. Most of the companies in this space are tiny with limited resources. They certainly don't have the $100,000 and up entry fees that Gartner would wish to take from them. That means the depth of analysis large enterprises expect to see as part of their decision making process could be missing. On the other hand, there are plenty of well informed analysts in smaller firms, along with independents that could back fill the space left by the big boys. You can argue that many of the products and services in the E2.0 space can be acquired at near petty cash levels and therefore their cost impact on the business is minimal. Either way, limited coverage contributes to making it awkward for the market to break out of its current niche position.