Key questions and answers from the first quarter earnings call conducted by Gartner Inc. (IT: chart) on May 8, 2008.

Peter Appert (Goldman Sachs): Give more detail on the cost shift issue?

Christopher J. Lafond: Given the current economic environment, we have been very tightly managing expenses across the whole organization, so we have been tightly managing all hiring, we have been tightly managing all discretionary spending, we have been tightly managing investments in our sales force, other investments in the product area.

We expect to continue to see the same kinds of performance and demand we have seen in the first quarter, that we will ultimately allow some of those expenses to happen later on in the year.

Peter Appert (Goldman Sachs): In the context of the dicier macro environment, are you seeing any change in terms of the trajectory of the ramp on newer sales people?

Eugene A. Hall: No, we are not. We track that very closely. Each quarter we look at the performance of sales people by tenure, by geography. If you looked across that, our newer people are gaining productivity at very close to the rate that we have seen over the last couple of years.

Peter Appert (Goldman Sachs): In terms of renewal rates, revenue growth rates within end user sectors, is there a significant differentiation in terms of what you are seeing from different types of customers?

Eugene A. Hall: No, if you look at it, across all of our geographic regions grew double-digit in research, and if you look by industry, we are highly diversified. We kind of reflect the entire economy and all industries showed double-digit contract growth year over year.

Peter Appert (Goldman Sachs): Why are you not a little more aggressive in terms of sales force hiring, et cetera?

Eugene A. Hall: Given the uncertain economic environment, we wanted to be cautious about how we invested and make sure that in fact the investments were going to pay off. We have been inclined to make these investments, including the sales force, to accelerate that over what we would have done if the economy were impacting us more.

Laura Lederman (William Blair): Are you seeing any weakness in the vendors?

Eugene A. Hall: We are seeing double-digit CV growth year over year in those, just as we are in the other segments and so while some companies are doing better, some companies are doing worse, as a whole in the technology sector, we are seeing strong demand.

Laura Lederman (William Blair): What are you seeing in IT budgets?

Eugene A. Hall: We are expecting IT budgets on the whole to grow in the 3% range this year and that is what we are seeing, so we have not seen, if you look at like certain financial institutions that are in trouble, they are cutting their budgets.

Overall, we are expecting and we are seeing net growth in IT spending today. We surveyed our clients actually very recently on this and this was a survey of more than 1,000 CIOs around the world.

Laura Lederman (William Blair): Comment about the price increases in terms of the existing products?

Eugene A. Hall: We have seen no push-back on our pricing at all, and it gets down to our products being so inexpensive for the guys that buy them. We plan to make a price increase in the fall of this year.

Our pricing strategy is on the price of our new products, we do not discount our new products to any of our clients and so those products sell for $15,000, that’s to all the clients. There’s no volume discount kind of program or something like that.

For these legacy agreements which we have, which people have, we tend to increase those at sort of a cost of living along with the new products, cost of living, and then upgrade people from the older, less expensive products to these newer high function products, which gives us an effective price lift with the client getting a new, better product for that additional pricing.

Laura Lederman (William Blair): Can you also talk a little bit about acquisitions?

Eugene A. Hall: We have a business development function. We see acquisitions a very important part of our strategy and we are always looking for opportunities where we can contribute to our business through acquisitions.