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Internet Edition, November 8, 2000, Page 1


Ogilvy PR Worldwide has won a $5.4 million contract from the Health Care Financing Admin.

Tom Beall, managing director of Ogilvy's global health & medical practice, said the firm is to expand HCFA's outreach so the people it serves can make more informed decisions about healthcare. He said Ketchum and GCI Group also were awarded HCFA business.

Ogilvy is to develop media and marketing campaigns for Medicare, Medicaid and the State Children's Health Insurance Program.

The contract is for one year with four additional option years. The overall package is worth more than $30 million.
Ogilvy's team members on the account include J. Walter Thompson Specialized Communications, Seniors Research Group, Aspen Systems Corp., Sutton Social Marketing and Jing Xing Technologies.


Ruder Finn/Chicago has added Veritel Corp., which markets voice verification technology and software, as a client. The business is worth $300,000.

Howard Solomon, RF/Chicago managing director, calls Veritel "one of the hottest emerging technology companies in Chicago."

Casy Jones, who is RF's business-to-business/ e-commerce practice manager, heads the account.

Chrysler consolidated its $1.8 billion ad account at Omnicom. The move represents a $140 million annual revenue loss for True North...Deen + Black, Sacramento, has signed $6.8M in state PR contracts, including a $6.1M piece of work for CalTeach, a California State University program to recruit teachers to the state's K-12 public schools. It is D&B's largest contract win...David Fluhrer, VP-PR at Medscape, to Avis Group Holding as VP-corporate comms., reporting to the pres., corp. and business affairs. Bill Heyman did the search. Fluhrer had also been VP of comms. at Olsten Corp., five years...Alta-Vista, a leading Internet search engine, has consolidated its account at GCI Group's San Francisco office. GCI president Bob Feldman said AltaVista is the "type of first class client" that the firm wants on its roster...Phase Two Strategies picked up SRI International as a client. Business Week called SRI "the soul of Silicon Valley."


Burson-Marsteller has won the $2.5 million Sony Electronics account, beating out Ogilvy PR Worldwide for the business, according to Brian Levine, VP-corporate communications at Sony.

"We liked Burson's professionalism, media relations capability and its enthusiasm" to service the account, he added.

Tracey Pontarelli will head the Sony account from B-M's New York office. She said the other team will be based in San Diego.

B-M will handle Sony's home entertainment, personal audio and computer lines.

Interpublic's Mindstorm, which had the businesss but did not pitch, will continue as PR firm for Sony's computer storage business.


Gus Weill, chairman of Burson-Marsteller's Corporate/Financial Practice for the past four years, has returned to Daniel J. Edelman Inc. as President/CEO of its PR21 unit. He succeeds Will Sullivan who left six months ago.

Weill headed Edelman PR Worldwide's PA unit in New York before jumping to B-M.

He said the opportunity to run his own shop-just like his father- was one that was too good to pass up. Gus Sr. has operated the Weill Agency, a political consulting firm in Baton Rouge, for 42 years.

Interscience's Chataway joins in Europe

Mark Chataway, one of the founders of Interscience, has joined Edelman's health unit as its chair Europe, a new position.

Nancy Turett, president & global director of Edelman Health, praised Chataway as one of the "original thinkers" in the healthcare business.

Prior to starting Interscience, which is now a unit of Bcom3, in 1993, Chataway was a managing director of Hill and Knowlton's London office.


International Assn. of Business Communicators has decided not to publish a print version of its World Book membership directory next year.

It will offer an electronic-only interactive version of the 2001 directory, which will be accessible to registered members. The 2000 WB had 735 pages.

The move is expected to save IABC $150,000 a year, though the group maintains that cost was not a factor in killing the printed book.

Internet Edition, November 8, 2000, Page 2


An eyeball-level avalanche of PR materials descends on New York Times ad columnist Stuart Elliott and his assistant each day, a capacity crowd of 175 was told at a PRSA/New York breakfast Nov. 2.

Elliott, speaking at the Sky Club atop the Met Life building, said the new "24-7" pace of ad/PR news keeps him so busy that he never has time for luncheon interviews, often stays past 6 p.m. at night, and usually doesn't get to read the Times itself until 10 p.m. at night or later.

If he does pick someone for a story, he said, he is apt to be smothered with materials, updates, and "backing and forthing until I rue the day that I ever agreed to do a story."

Elliott faulted PR for not providing enough middle management PR people who can train the recruits. He said he and his assistant "make an endless number of calls to get the basic information that you know we need."

He gets about 100 e-mails a day and many of them have attachments. One had seven attachments and each one of them had about seven pages.

Noting that he tries to be as accommodating as possible, answering his own phone when able and answering his own e-mails, Elliott said he sometimes thinks that "people take advantage of this."

He urged the PR audience, "Don't put obstacles in our way; take them out of our way."

"Feeding Frenzy" of Mergers in Ad/PR

Noting there has been a "feeding frenzy" of mergers and acquisitions in advertising and PR, he said, "This has not always been for the best." Some of the companies are "dressed up" for the sale and some of the sellers seem mainly worried about their stock and options, he added.

Some of his fellow journalists, he noted, like to brag about how many PR people they hung up on or otherwise blew off. "This shows the insecurity of journalists," he added. "There's a lot of tension on both sides," he said.

In a putdown on the hype and hardsell of advertising and PR, Elliott noted that PR and ad campaigns drew a lot of people to websites but there was little there of interest to them, resulting in the folding of many dot-com companies.

"The websites got the wrong people to go there or the right people went there and found nothing," he said.
In response to a question by PRSA president and COO Ray Gaulke, Elliott said he only covers major news about PR because his editors feel the industry is something that should be left to the PR trades.

Doesn't Like Gimmicks

He doesn't like press kits that "burp and belch" or promoters dressed up as animals. "You're not allowed upstairs, you're barely allowed in the lobby," he said. He was "flabbergasted" when someone recently sent him a videocassette along with a 13-inch TV set on which to view it. When he complained, the sender told him to give it to a charity.

He also heard the same gift was sent to a half-dozen other reporters.

The way to get into his column, he said, is to read it and send materials that help him with his stories. "Leave voicemail messages that are no longer than my voicemail message," he advised.


The biotechnology industry must do a better job of winning the public's confidence, says veteran PR counselor Christopher Klose, who for the past 10 years had been VP-comms., American Crop Protection Assn. He was deeply involved with emerging biotechnology issues.

Klose, who is now with John Adams Assocs., Wash., D.C., mapped out a PR plan to help the biotech industry in the Oct. 31 Washington Post.

Citing a recent front page Post story-"Frankenfish' or Tomorrow's Dinner?," Klose said the story illustrated "how much society has to gain from biotechnology and also just how much this valuable new food production tool is being put at risk by the biotechnology industry's business-as-usual attitude."

He believes the biotech industry has failed to win the public over because "those in the industry typically begrudge the public such involvement in `their' issues. When it comes to science, they know best.

"This sincere but misguided attitude makes it very difficult for industry to relate to the public, as a visit to the Council for Biotechnology Information website ( shows."

Klose said the site, which is funded by most of the world's leading biotech research and development companies, fails to accomplish its mission, which is to convince the public of biotech's many benefits.

"But after a nationwide recall of taco shells, and a shutdown of Kellogg cereal production over 'escaped' biotech corn, something more than routine reassurance is called for," said Klose.

The benefits of biotechnology can be fully realized only if the public has confidence in the process of its invention, approval and use, he said.


Bloomberg has launched the "Investor Relations Channel," a new service that allows direct distribution of information to the institutional and retail community.

"The Investor Relations Channel will provide a means to assist companies in meeting their responsibilities under the [SEC's] new Regulation FD. It will allow companies to disclose information to the public," said Emilia Fazzalari, manager of news business development for transaction data services.

The information and data that will be available on the channel will include earnings statements, estimates and guidelines, multimedia management presentations, company news and profile information, Bloomberg analytics, press releases and SEC filings.

The channel is available on the Bloomberg Professional Service and

Internet Edition, November 8, 2000, Page 3


Journalism professors are against including PR courses in the communications curricula because PR people are "evil defenders of corporate power and enemies of journalism," writes a Pennsylvania college professor in the October issue of Quill, which is published for members of the Society of Professional Journalists.

"As a former journalist and PR professional who now teaches both PR and media courses to undergraduate students studying communication, I've always felt there is a tremendous overlap between journalism and PR curricula," wrote Anthony Peyronel, assistant professor and undergraduate program coordinator at Edinboro University.

"Indeed, the study of PR is as ethically grounded as the study of journalism. Students of PR are taught that the practice of PR is based on communicating honest information and dealing fairly with a variety of publics," writes Peyronel. "In case study after case study, organizations that deal openly and honestly with negative situations demonstrate that ethical behavior is at the very root of effective PR."

PR Takes High Road

"Despite occasional ethical lapses and the tendency of some PR practitioners to allow `spin' to cloud one's definition of truth, I would argue that the ethical `high road' is the path most often taken by PR professionals," said Peyronel.

"And isn't it an advantage for students of journalism to be exposed to persuasive communications techniques so that, as working journalists, they are better prepared to sort between hard facts and phony rhetoric?" he asks.

"As for the characterization of PR professionals as tools of the rich and powerful, on the contrary, I find that most of our graduates seek entry-level employment with social service agencies and other nonprofit organizations," Peyronel states.

"To me, this PR versus journalism debate was best summed up by a Columbia Journalism Review study conducted some two decades ago. The study found that half of one day's news stories in The Wall Street Journal had originated with a press release written by a PR professional and that 90% of the day's news stories could be traced to an idea that was proposed by a PR source.

"Frederick Taylor, then the Journal's executive editor, expressed no embarrassment at the influence that PR people had on news coverage at the paper. Rather, he said, the study merely proved that journalists and PR pros both play important-albeit different- roles in getting accurate information to the public."


Chicago's WBBM has switched "The 10 O'Clock News" back to a more traditional "happy chat" evening news format.
When it made its debut in February, station executives believed they could boost the station's local news audience by offering a no-frills program that featured longer pieces and more investigative reports.

Sensational crime reports and segments on the latest diet fad with the happy chat of a standard, male-female anchor team were replaced by reports on complicated subjects like predatory loan practices.

National and international stories were featured more prominently. The reports were delivered by a lone anchorwoman, Carol Marin, on a new, somewhat mutted and dark set. Despite an immediate and brief rise in the ratings, the program started to drop off.

During the July sweeps, the program's overall audience was about 20 percent smaller than that of the program it replaced.
Starting Oct. 31, Marin is being replaced by a male-female anchor team. They will report the news from a brighter, more traditional-looking setting.

Walter DeHaven, the WBBM VP and general manager, said the program will not become sensational and would seek a middle ground. DeHaven believes the program failed because it was too stern.


WBBR-AM, a New York-based all-news radio station, changed its format as of Oct. 30 from business to general news.
The change means more local, national and international news will air on the station, which is owned by Bloomberg, the financial information company.

The move puts WBBR in competition with two other AM all-news stations, WCBS and WINS, which are ranked No. 8 and No. 13, respectively, in New York, according to the latest annual figures from the Arbitron Co. WBBR does not rank among the Top 25.

In the last few months, WBBR, which operates from studios at Bloomberg's headquarters at 499 Park ave., has hired several reporters away from other stations.


Primedia, a publisher of several magazines including New York and Seventeen, is buying About Inc., online media company, for $690 million in stock.

About is one of the few companies in the Internet sector to deliver an upbeat outlook during its recent earnings report. The company's of more than 700 media niches and 700 topic-specific Guide Sites, and some 10,000 associated experts.

The sites cover about 50,000 subjects with over one million links to the best sources on the 'Net.

Each site has a professional guide who is an expert in the field. The site, which is free, generates revenue through advertising. It relies on click through percentages to determine success rates, as opposed to streaming banner ads.

(Media news continued on next page)

Internet Edition, November 8, 2000, Page 4

MEDIA BRIEFS __________________________

EBay Inc., the San Jose-based online auction site, is shutting down EBay, its monthly magazine after the December issue.
The magazine, which focused on general Internet developments, collecting and eBay's website, had a circulation of about 400,000.

EBay is currently negotiating to launch a TV show that will spotlight the auction site, which had 18.9 million registered users as of Sept. 30.

American Profile magazine, which has been published on an every-other-week basis since it was launched in April, is moving to a weekly schedule.

The magazine has built an estimated circulation of 2.2 million through distribution in more than 450 small market daily and weekly newspapers in the eastern half of the U.S.

By the end of the year, publisher Dan Hammond, who is based in Nashville, predicts circulation will reach six million; by 2005, 15 million.

Each issue features recipes, a hometown and a hometown hero in each of the three regions where the magazine is currently published-Midwest, Southwest and Northeast.

USA Today, The Wall Street Journal, The New York Times, New York Daily News, The Los Angeles Times and Chicago Tribune were among the top 20 papers showing slight gains in daily circulation, according to figures released by the Audit Bureau of Circulations.

Overall, average daily circulation fell about 0.5% and Sunday circulation fell about 0.7%, as of the six-month reporting period ended Sept. 30.

By category, newspapers with circulation over 500,000 showed a slight decline, while those in the 250,000-499,999 range were up, according to an analysis by the Newspaper Assn. of America. The biggest drop was reported by papers with circulations under 50,000.

Gannett has taken an equity interest in, the Internet media company started by Lou Dobbs, the former CNN Financial News anchor.

Gannett is contributing cash to the struggling venture, which laid off 20% of its staff in September. will take over Gannett's Space News newspapers and its Space Online Website.

Tribune Co., Chicago, has agreed to sell Times Mirror Magazines to Time Inc. for $475 million in cash. The consumer titles and custom publications, which are read by more than 55 million people each month, include Field & Stream, Popular Science, Golf Magazine, Outdoor Life, Today's Homeowner and Ski Magazine.

Primedia's Intertec Publishing has acquired six magazines and an Internet site from Adams Business Media, Maynard, Mass.

The titles, which are from Adams Meeting Group, are: Corporate Meetings & Incentives, Association Meetings, Medical Meetings, Insurance Conference Planner, Technology Meetings, Religious Conference Manager and is going daily with "Global Agenda," a new service, exclusive to the website and distinct from the weekly Economist magazine.

Positioned as the daily Economist, Global Agenda will provide rolling coverage and analysis on six to eight business and political topics each day.

Internet Edition, November 8, 2000, Page 7


The new PRSA ethics code appears to be "weak" and to "lower" the ethical bar for members, the PRSA Assembly was told Oct. 21.

Alison Karam, president-elect of the Connecticut Valley chapter, APR coach, and a 20-year PR veteran, said she polled 17 members of the chapter on the new vs. the old code.

The members, who had 263 years in total experience and included 10 APRs, favored the old code by a two-to-one margin, she said.

The new code, created by a nine-member ethics board headed by Seattle counselor Bob Frause, replaces a 17-article code that was initiated in 1950. It had undergone several revisions, the latest in 1988.

Karam, a public communications officer with the town of West Hartford, said the old code was a "strong code that set high expectations."

She likes the fact that PRSA is no longer in the enforcement business but said the statement of professional values "seemed weak."

The language was "many times slanted towards someone in an agency situation and I felt that the bar was being lowered in terms of the standards we hold ourselves to," she added.

Had "Strong Negative Feelings"

Karam's "strong negative feelings" led her to seek the opinions of other chapter members.

She said they liked the old code because it "sets higher standards for ethical conduct," is "detailed and comprehensive," and "leaves little to personal interpretation to PR practitioners prone to cutting corners."

The new code, she continued, is "oversimplified" and "leaves too much up to personal interpretation." She likes its "emphasis on education."

Frause said the old code was not enforceable and had become "a joke" and "an embarrassment" to the Society. Attempts to enforce it were met with threats of expensive lawsuits, he added. With the new code, "we become educators, not policemen," he said.

Patrick Jackson, 1980 president, told the Assembly his experience with code enforcement was that "a lot of people spent a ton of money on lawyers to avoid being thrown out."

In the new code, members pledge responsible advocacy; honesty; expertise; independent counsel; loyalty to those represented, and fairness in dealing with clients, employers, competitors, peers, vendors, the media and the public. "We respect all opinions and support the right of free expression," it says.

The new code dismantles the system of judicial panels that used to try the accused and drops the requirement that members report unethical behavior by fellow members and that they appear as witnesses against them.


The PRSA nominating committee's shift of David Simon from "open" board member to "district" member was "wrong" and "arbitrary," San Diego counselor Ken Ulrich told the PRSA Assembly in Chicago.

Nominating chair Mary Cusick disagreed, saying "everybody's from someplace" and that the committee just let Simon represent the district where he is already based.

Ulrich said that if Simon's switch is left unchallenged it could impact all of the ten districts in the years ahead.
Simon, a Los Angeles counselor, was elected in 1999 to a two-year term starting in 2000 as one of the two "open" directors on the board (each of the other ten seats being assigned to a district).

The nominating committee this year re-designated him as the Western district director to succeed Ralph Kam. This blocked Jeff Julin from running for Western district director. He was defeated for "open" director. Julin has unsuccessfully sought to be on the board four times.
Shifting Simon "over-rode" what the Assembly did last year, said Ulrich.

Cusick Says Change Bylaws

Cusick said the bylaws do not distinguish between "open" and "district" directors and the Assembly will have to change the bylaws if it wishes to do so. She said no one's representation was changed and that the nominating committee did not "tinker" with what the Assembly had done, as charged by Ulrich.

She said Simon "happens to be from Western" so that Western is not a "mandated seat because a person on your board is already representing Western because they're from there no matter how they came to be in that."

Ulrich later said a "close analogy" would be a Senator who serves a whole state suddenly being named a Representative for a specific district.

Concluded: Ulrich: "I would only submit that this Assembly was the body that last year elected David Simon to an open seat, not a mandated seat which he now occupies."


Robert Weintraub and Michael Rinaldo were elected to the two top positions for PRSA/New York. Weintraub, a PR consultant, will be president for 2001, and Rinaldo, who is a SVP/healthcare group director at Fleishman-Hillard, will be president-elect.

Other new officers elected to the executive committee were: VP-programs-AT&T's Ellen LaNicca-Albanese; Treasurer-consultant George Rosenberg, and Secretary-Don Bates, of Media Distribution Services.

Internet Edition, November 8, 2000, Page 8

The new PRSA code is a disappointment to some members, who feel it's "weaker." It is.

The new code, after a preamble, starts out with "Advocacy" as the first of six "core values" of members and "the PR profession." In other words, PRSA is saying it is setting the moral tone for the entire PR profession. "Advocacy," by the way, is not a word that appears anywhere in the previous code, much less as the first word.

The old code emphasized the "dual obligations" of PR pros to the client and the "democratic process."

We interpret the new emphasis on advocacy as a triumph for the integrated marketers who see PR as another sales technique. The new code puts the PR pro firmly on the client's team rather than serving as a bridge to the press and public, providing facts good, bad and indifferent about employers.

The main problem with the new as well as the old code is that it only applies to individuals whereas almost all PR people practice corporately whether in companies or agencies.

The top 50 PR operations employed 22,000 people in 1999, accounting for the great bulk of those in the counseling business. The employees pitch accounts, service them and win awards all in the name of the corporation. Only a few employees of the giant PR operations may be in PRSA and they may not be in a position to dictate corporate policy.

Under the old code, an agency could do practically anything and escape the wrath of the PRSA ethics board unless the fingerprints of a PRSA member could be found on the case involved.

The most glaring recent example of this involved Duffey Communications of Atlanta, which was accused by the Exterior Insulation Finish Systems industry (EIFS) in 1997 of doing "pro bono" work for dissatisfied EIFS homeowners while at the same time having undisclosed or insufficiently disclosed brick interests as a client. The published account list of DC at that time did not show any such clients. Lee Duffey was secretary of PRSA and in line to be chair.

Charges that a front group was being used were covered extensively in this NL, the Birmingham News, and Walls & Ceilings magazine.

No public discussion of this ever emerged from the PRSA ethics board because it only deals with individuals. The ethics board, by failing to take any public notice of a well-publicized case involving a national board member, had forfeited the right to go after anyone in the future. Lawyers would just pull up the EIFS/Duffey matter and ask why this was also not prosecuted.

A similar case just hit the front page of the New York Times. It noted on Oct. 5 that Elizabeth Helms of Folsom, Calif., billed as a consumer activist representing three "grassroots" groups, testified to a Senate panel that pharmacies are partly to blame for high drug prices. But the audience did not know she also works for a PR firm with drug industry clients, said the Times. Here was a public case that the ethics board could explore although its habit is only to speak abstractly and avoid mentioning real cases. The front group issue remains as one of the hottest of the day in PR.

As for the ethics board setting the standards for the entire PR world, we think it should look to PRSA's own house first. PRSA's copying and selling thousands of pages of authors' articles without their permission was certainly unethical as was the false and misleading financial reports that PRSA has given to its members for years. Switching David Simon from "open" to "district" director (page 7) was wrong as was the interference of a majority of the PRSA board with the officially nominated slate this year. Skipping an issue of the 800-page Blue Book that members paid for is also wrong especially in view of the nearly $2 million lavished on APR in the past ten years, board meetings at resorts, etc.

The Stuart Elliott talk to PRSA/New York (pg. 2) is a wake-up call to PR people and the clients that are footing the bill. Elliott's ad column is a key media outlet since it's read throughout the U.S. and is aimed at consumers as well as the ad/PR industry.

Elliott and his assistant, who know more about the actual practice of PR than any team in America, are bombarded by a deluge of hard-sell pitches that often leave out the basic facts. They have to make "endless calls" to get the facts "you know we need," he said. Once a story idea is accepted, the agency and client, with boundless enthusiasm for the product, are apt to assault him with materials including numerous revisions until he is sorry he ever spoke to them. "Don't put obstacles in our way, take them out of our way," pleaded Elliott. He also faulted PR for putting too many juniors on press relations...the PRSA code mentioned above was obviously written without any input from the press because the No. 1 request of the press is access to CEOs and other client executives. It should be junked and replaced with a new code co-authored by reporters such as Stuart Elliott...the excuse long given by the PRSA ethics board that it can't criticize anyone publicly because it might get sued is a cop-out. The publicity that would be generated by someone suing PRSA on an ethics matter would be ruinous to the litigant. All details of the case would become public record.


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