Edition, February 21, 2001, Page 1
GUARD ISSUES $250M IN PR RFPs
The National Guard has issued five PR-related RFPs, covering
work worth $250 million during a five-year period, according
to Elizabeth Keys, a contract specialist at the Guard.
They are for marketing communications ($100M), PSAs ($50M),
state media outreach ($50M), Internet services ($25M) and
personnel recruitment/retention ($25M). There is another
$150 million pact for advertising.
Keys said the RFPs have generated "strong interest"
among communications firms since they were issued earlier
this month. The deadline to respond to the proposals is
Keys said Laughlin, Marinaccio & Owens, Arlington, Va.,
is the incumbent, handling advertising, PSAs and state outreach
for the Guard. The other three pacts are new offerings.
The National Guard, which celebrates its 365th anniversary
this year, wants a more family-friendly image, and greater
support among employers, which may be upset over losing
Guard workers for extended periods.
Media placement plays a larger role in the $100 million
marketing communications program, according to that RFP's
"performance work statement."
SINGAPORE'S TOUR ACCOUNT UP FOR GRABS
Singapore Tourism Board invites pitches for its U.S. consumer/trade
account, a business that bills at least $25,000 a month.
Baltimore-based Trahan, Burden & Charles is Singapore's
PR firm. The account is handled out of New York by Liz Elman.
She said TB&C has worked for Singapore for three years,
and plans to pitch the business.
The city state, which attracts seven million visitors a
year, seeks to position itself as Asia's premiere leisure
destination and an ideal location for business meetings/conventions.
Singapore is asking
prospective firms to undergo a "pre-qualification exercise."
They must submit tourism credentials, a roster of current/past
clients, details of overseas affiliations/offices, resumes
of key personnel who will handle the business, and audited
financials for the past two years.
That information is due in STB's Los Angeles office on Feb.
28. "Shortlisted" agencies will be asked to develop
a comprehensive PR plan with costs and fee
proposals by March 30.
BSMG NAILS DOWN WOOD PR
BSMG Worldwide and sister ad agency Bozell are handling
the three-year $45 million communications campaign of the
Wood Promotion Network.
It's "Be Constructive" theme promotes the use
of wood, and trashes "environmental misperceptions"
that people have about the forest products industry.
Susan Rogers, who handles PR/advertising for the WPN, said
Fleishman-Hillard, GCI Group, Edelman PR Worldwide and Golin/Harris
BSMG "flew to the top of the list," according
to Rogers, because of its broad "category" experience
gained by working for clients representing milk, pork, biotech
and wine trade associations.
She credited BSMG with understanding the dynamics involved
in dealing with individual members of associations.
That is especially important for WPN due to its diverse
membership base. "We have 120 members that represent
everything from makers of two-by-fours to high-end furniture,"
PRSA LOSS FOR 2000 IS $650-$700K
Because of unforeseen costs, miscalculated conference profits,
and back taxes owed, PRSA will post a loss of between $650,000
and $700,000 for 2000 instead of breaking even, chair Kathy
Lewton and president Catherine Bolton said Feb. 14.
PRSA lost $426,288 in 1999.
The 2000 conference in Chicago was supposed to net $387,000
but instead only made $42,000 because costs of the meeting
were higher than anticipated. There was also "double
counting" of some revenues of the session.
The meeting drew a record 3,400 participants including several
hundred from abroad.
Another major cause of the loss is that PRSA has not done
the proper tax accounting for its advertising revenues,
which totaled $781,199 in 1999 and $732,527 in 1998 for
its Tactics monthly and Strategist quarterly.
Because of improper tax accounting, PRSA owed $135,000 in
back taxes, penalties and interest, said Lewton.
It had been booking the ad income as regular income in the
same category as dues.
However, the Internal Revenue Service says that a certain
portion of such "unrelated business income" (minus
expenses) is taxable.
on page 7)
Edition, February 21, 2001, Page 2
SAYS LYING, HYPE CHEAPEN PR
Fraser Seitel, a PR consultant and the author of a top selling
PR textbook for college students, said "overzealous
hyping and underexposed thinking have cheapened the currency
In a speech he gave Jan. 26 to the PR Assn. of Southern
California Colleges at the Richard Nixon Library in Yorba
Linda, Seitel said PR pros ranked 43rd on a list of 45 spokespeople
in a "Credibility Index" prepared for PRSA last
"There are many in our society who believe that PR
people are nothing more than insidious manipulators, exploiting
powerful relationships with the press and public officials
and relying on devious propaganda techniques to orchestrate
public perception for the benefit of the rich and powerful,"
If PR is to grow in stature, Seitel said CEOs need to be
convinced of "our relevance and our value."
The burden is on PR practitioners to demonstrate, both in
terms of technical skills and attitude, that "we are
worthy of trust and confidence," said Seitel.
"That means you must be the best writer, the best speaker,
the most accomplished web researcher and media expert,"
"Communications is your skill. And you must be proficient
in all aspects of it. You can't just `like people' or `like
parties' or `like ya know,'" he said.
Seitel, who gave his definition of PR as "protecting
and defending and enhancing the credibility of our organization
in perpetuity," said PR pros should give only ethical
advice to clients. "This, above all else, is the characteristic
that distinguishes PR from other fields," he said.
PR people must stand for one thing above all else-truth
and candor and honesty.
"Unfortunately today-where it's acceptable to `spin'
or `obfuscate' or even `lie'-whether you're talking about
presidents or preachers or tires or tobacco companies-candor
and honesty seem in short supply," said Seitel.
CATALOGS SOME PR DEALS WITH MEDIA
FAIR's first "Fear & Favor" report cites several
instances where the media cowed to PR pressure last year.
Among the behind-the-scenes deals cited are:
--United Airlines and US Airways' deal with The Washington
Post, The New York Times and The Wall Street
Journal to give them the story on the airlines' merger,
as long as the papers didn't call any "critics"
--The Idaho Statesman for telling business editor
Jim Bartimo that his story about Micron Technologies, the
area's largest employer, had to be sent to the company for
--KIRO-TV's "Saving the Salmon" documentary, which
was actually a half-hour infomercial paid for by the Washington
Forest Protection Assn., a timber industry group whose members
include Weyerhaeuser and Boise Cascade.
--Peter McFarren, the Associated Press' Bolivian correspondent,
who resigned amidst revelations he had lobbied the Bolivian
legislature for a $78 million water privatization project
profiting a foundation he presided over.
--"Today" show travel editor Peter Greenberg,
who sent a memo to travel and resort promoters stating the
reason some of the "destinations/resorts" did
not make it on the air was because they had "no good
video to support them."
A full report is available online at www.fair.org/
TRIMS 20 OF 800 EMPLOYEES
Brodeur Worldwide, Boston, part of Omnicom, on Feb. 9 laid
off 20 employees, less than ten of them in the headquarters
There were other layoffs in Brodeur offices in Phoenix and
Andrea "Andy" Carney, who became CEO last October,
said that most of the workers were involved in website development.
Some of them may relocate to other parts of Brodeur, she
Remaining strong, she said, is demand for online communications
and e-businesses of clients. One of the founders of Brodeur
in 1985, Carney was president of Brodeur/U.S. before becoming
CEO of the parent last October.
New York Times advertising columnist Stuart Elliott
on Feb. 12 reported staff cuts at a number of ad conglomerates
including Omnicom; Leo Burnett USA; Bcom3; FCB Worldwide
of True North; Grey Worldwide and MediaCom units of Grey
Global; units of Interpublic, and Young & Rubicam Advertising
of WPP Group.
FROM RNC TO BSMG
Cliff May, who was communications director for the Republican
National Committee, has joined BSMG Worldwide as senior
managing director in Washington, D.C. He previously reported
for The New York Times and Rocky Mountain News.
May, who joined BSMG as a senior managing director, said
he was "simpatico" with BSMG's respect for journalism.
He is succeeded at the GOP by Mark Miner, who was former
press secretary for Virginia Gov. Gilmore.
Massachusetts Bay Transportation Authority is seeking
corporate sponsors to buy naming rights for Boston subway
stations. Sponsorships, which would let businesses put their
names on and around stations, could raise as much as $20
million in the next five years, officials said.
Existing station names will be printed in bold, before the
names of sponsors, so riders will not be confused, officials
The plan is opposed by Ralph Nader, who founded Commercial
Alert to oppose excessive corporate marketing.
Edition, February 21, 2001, Page 3
PAPER BREAKS EMBARGOED REPORT
The London Observer's exclusive report in its (Feb.
11) Sunday edition that humans have some 30,000 genes also
broke open the controversial practice of "embargoing"
science news, according to The Wall Street Journal.
The Journal said the Observer's scoop "underscores
the conundrum facing press handlers: How to maximize the
hype surrounding a story and still maintain control of its
The paper said the episode also "shines a bright light
on the arcane world of science reporting, where the practice
of embargoing information has been customary since the 1960s."
"Until now, scientific journals have been able to enforce
embargoes to a surprising extent," said the Journal.
"That's because when reporters violate these agreements,
the journals won't send them advance information on other
articles to be published. As a result, reporters may not
know about a new development-unless they do their own reporting."
"I think embargoes may now be on the endangered species
list," Rick Weiss, a science writer for The Washington
Post, told the Journal.
Recently Nature and Science magazines offered
to give media organizations, including the Journal, an advance
look at their articles about the gene-mapping breakthrough
of Celera Genomics Group and the International Human Genome
Journalists who got a preview had to honor an embargo, or
agree that they would not publish the data until after a
press conference that was to be held Feb. 12.
Never Made a Promise
Robin McKie, the Observer's science reporter, told the Journal
the story he wrote did not break the embargo because he
never promised to abide by it. McKie also broke the story
of the cloning of a sheep named Dolly, which was another
big science story four years ago.
McKie said he got the genome story by attending a public
biotechnology conference in Lyons, France, on Feb. 9, where
J. Craig Venter, Celera's chairman, revealed many details
of the genome map that Science was going to announce on
A spokeswoman for Celera said McKie could only have gotten
his information from another journalist who had agreed to
After the Observer hit the newsstands Feb. 10, London evening
time, staffers at Science and Nature conferred by phone
and agreed to lift their embargoes.
The Washington Post, The New York Times, The Los
Angeles Times and other publications rushed to get space
MEDIA BRIEFS ____________________
Time Inc., the magazine publishing arm of AOL Time
Warner, is consolidating its business and financial magazines
into a new unit to be headed by John Huey, the longtime
editor of Fortune magazine.
Huey will oversee Fortune as well as two Fortune spinoffs,
eCompany Now and FSB: Fortune Small Business.
He will also oversee two other financial magazines, Money
and Mutual Funds.
Richard Kirkland, who had been Huey's deputy at Fortune,
will become editor of the magazine.
Meredith Corp. is removing Family Money magazine
from mail subscription and returning it to the newsstand-only
group of Better Homes and Gardens special interest publications.
The bimonthly magazine, launched as a quarterly in 1997,
will end mail delivery after the March/April issue. The
500,000-circulation magazine focuses on finances for women
The Portland (Ore.) Tribune, a twice-weekly
newspaper, has been started by Robert Pamplin Jr., who built
his wealth on textile mills in six states. He is constructing
a media conglomerate in the region.
The Tribune, which will be delivered free to about 120,000
households, will compete against The Oregonian, a
daily paper which is owned by S.I. Newhouse family's Advance
which featured explanations of political issues, links
to campaign spending data and original opinion columns,
is shutting down. The company's 45 remaining employees will
be laid off.
Skiing magazine, based in Boulder, Colo., has
promoted Bevin Wallace to managing editor, replacing Lindsey
Diforio, who was named ad manager.
The Miami Herald promoted assistant managing editor Mark
Seibel and Elissa Vanaver to managing editors,
succeeding Larry Olmstead, who left the paper to
become assistant VP for its corporate parent Knight Ridder.
Seibel will oversee news, and Vanaver will run features
City editor Judy Miller will replace Seibel as assistant
Terence Hunt, 54, White House correspondent for The
Associated Press for 20 years, was promoted to assistant
chief of AP's Washington, D.C., bureau for news, succeeding
Mike Feinsilber, who retired.
Ken Solomon, a TV and new media industry veteran,
will become president of Scripps Networks' soon-to-be-launched
cable network, Fine Living. Solomon, 38, will be based in
The new network, which is expected to launch this year,
will be devoted to aspiring lifestyles and upscale tastes.
Solomon comes from iBlast Networks, where he was president.
news continued on next page)
Edition, February 21, 2001, Page 4
SAY THEY NEVER LIE TO PRESS
Iowa's top business people said they have never lied or
misled the media, a view not shared by more than four out
of 10 media people who work for news organizations in Iowa.
This was not the only area in which business and media leaders
in the state held different views, according to the findings
of a survey of 532 of Iowa's largest businesses, and 272
daily, print, broadcast and Internet news media outlets.
The survey was recently conducted for Hanser & Assocs.,
a Des Moines-based PR firm.
While 95% of editors believe the media give Iowans a clear
view of the business world and business issues, 55% of the
business executives believe the media give a distorted view
of business issues.
When asked if the media is more interested in scandal, conflict
and sensationalism rather than solid facts, 81% of business
executives said yes, and 49% said they tend to avoid contact
with the media for this reason.
Less than half (42%) of the business leaders think Iowa's
news media are biased against business, but 60% of the business
leaders and 55% of the media respondents believe news organizations
are manipulated by advertisers, politicians, and government.
Sixty-nine percent of business respondents said the media
is predominantly left in political orientation, while 77%
of journalists classified themselves as politically neutral.
Overall, 59% of the business leaders said they trust Iowa's
news media, and 90% of the journalists said they trusted
Need More Education
Media and business executives also agreed reporters should
have a more comprehensive understanding of business.
Seventy-six percent of media respondents said reporters
do not have sufficient backgrounds in economics, accounting
or other business concepts to cover business issues, and
nearly 74% of business repondents believe reporters do not
have sufficient backgrounds in these areas.
Ninety-five percent of the business executives said business
stories are more accurately told by reporters with specific
indusdry background, such as business editors or editors
of trade publications, and 73% of the media respondents
agreed with this view.
Media give business executives average grades in their abilities
to work with the media, with the highest grade (B-) for
interview preparedness and fair-to-good grades (C+) in accessibility,
quotability and trustworthiness.
Business executives give journalists an overall average
grade of C, with the highest grade (C+) for the media's
ability to be factually accurate and report useful information.
The Chicago Headline Club and Loyola University's
Center for Ethics have created The Ethics Advice Line for
"Though the vast majority of journalists strive to
be ethical, all of us are hurt by reports of columnists
who create fictitious people and quotes, of undisclosed
revenue-sharing schemes between news organizations and advertisers
and of undercover reporting that is considered legal,"
said a press release announcing the free service.
The service is open 24 hours a day, and pledges to try to
respond to queries within 24 hours.
CNNfn, which is being renamed "CNN Money"
later this year, has begun to make changes in its program
Starting Feb. 26, the evening show "Big Buzz"
on the media and entertainment industry will be renamed
"The Biz," airing from 11:50 a.m. to 12:30 p.m.
with new host Susan Liscovicz.
A new show called "The Money Gang" will air from
12:30 p.m. to 3 p.m., replacing general market coverage.
The show, hosted by David Haffenreffer and Christine Romans,
will be a roundtable discussion with market experts.
CNN, the flagship network, also continues to tinker with
its programming. It is adding a new show called "He
Said/She Said," that will focus on the latest movies,
home releases and other entertainment news. The show will
air Saturdays from 10:30 a.m.-11 a.m.
The Wall Street Journal's free online entrepreneurial
center, will feature a new monthly column on PR and marketing
starting in March.
Written by Edward Segal, author of Getting Your 15 Minutes
of Fame, and More: A Guide to Guranteeing Your Business
Success (John Wiley, 2000), the column will cover PR
and marketing strategies, tactics and techniques for executives
of startup companies and aspiring entrepreneurs.
Topics to be covered will include: how to make effective
presentations to investors; selecting and working with advertising
and PR agencies, and how to prepare business marketing plans.
Segal is a Washington, D.C.-based PR consultant.
Tony Lee is general manager and editor-in-chief of Startup.wsj.com,
which is published by Dow Jones.
The Daily News Express, a free weekday afternoon
newspaper, has a circulation of 90,000, according to Les
Goodstein, president/COO of the Express' parent, The
New York Daily News. The paper, which first published
on Sept. 12, is distributed outside of major bus, train
and subway commuter hubs in Manhattan.
Oahu Publications, the company purchasing The
Honolulu Star-Bulletin, has named John Flanagan as
Edition, February 21, 2001, Page 7
LOSS IS $650-$700K (continued from page 1)
from professional development seminars is considered professional
fees and is not taxable.
Any ad that attempts to sell a product or promote a company
(almost all of them do) is considered to generate taxable
Not taxable would be income from an ad that said, "Compliments
of a Friend" and merely listed the name of the company.
With PRSA following this ruling, its two periodicals become
much more expensive. Certain other income of PRSA is also
Also discovered were $100,000 in unpaid bills that belonged
in 1999 but were then placed in 2000. Estimated taxes for
2001 are being paid in 2000, it was also noted. Another
mistake was that the value of inventories carried was recorded
the wrong way.
PRSA owes money to the installer of the iMIS computer system
and doesn't want to pay it but is booking it as though fully
is to return $200,000 to the treasury in 2000.
Strategist Goes In-House
In one move to cut costs, Strategist has been brought "in-house,"
meaning the bulk of the work will be done by PRSA staffers,
Fraser Seitel, editor of Strategist since its founding five
years ago and who has interviewed 20 CEOs for the magazine,
will now be a contributing editor.
Also affected is Ernie Blitzer, executive art director of
Strategist and a non-staffer.
The outside "professional fees" for Strategist
were $144,897 in 1999 and $140,087 in 1998. Presumably,
most of this went to Seitel and Blitzer.
John Elsasser, editor-in-chief of Tactics, becomes the head
of communications at PRSA including Strategist.
All printing contracts of PRSA, including those for Strategist
and Tactics, will be put up for bid, said Lewton.
She would not discuss the final settlement with Ray Gaulke,
who resigned as president and COO at the end of 2000 with
four years still to go on his contract. Elizabeth Allan,
who resigned as president and CEO of the International Assn.
of Business Communicators as of Jan. 15, was given a final
payment of $50,000 to be spread out over the next two years.
Lewton and Bolton discussed the Society's finances but did
not have an unaudited financial report.
audited report will be out in April, they said.
PRSA started out 2000 with 21,000 members, added 3,800 new
ones and lost 4,700 for a renewal rate of 77% annualized,
said Lewton. She said she was not happy with that rate and
said PRSA is doing everything it can to raise it. Members
of the PR Student Society of America will start calling
lapsed members, she said.
Reed Byrum, treasurer of PRSA, addressing a teleconference
Feb. 14, said the PRSA staff is now able to communicate
"bad news" to the board, creating "an atmosphere
that did not exist." Lewton admitted the staff was
"nervous" last year when bad news was surfacing.
caller said he learned about the financial difficulties
of PRSA on the O'Dwyer website. Both Lewton and Bolton promised
that communications to members would improve in 2001.
Robert Stack and Michael McDermott are members of a new
audit committee. Asked about possible "improprieties"
in the past two years, Lewton said there were "strange
systems" and "poor judgment" at PRSA h.q.
but "nothing nefarious."
LOSS FOR 2000: $1 MILLION
The International Assn. of Business Communicators reported
an unaudited loss of $1 million for the year ended Sept.
30, 2000 on income of $5,459,016.
The group is projecting a loss of $600,000 for the year
to Sept. 30, 2001. It lost $339,987 in 1999 on revenues
of $4.8 million.
The figures were announced by Charles Pizzo, chair, in an
e-mail to members.
Interim president Louis Williams, in another e-mail to members,
quoted IABC finance director Paul Sanchez as saying that
what happened to IABC over the past 18 months could be described
as "The Perfect Storm," in which a number of negative
developments impacted the association at one time.
"A number of related and unrelated events came together
at nearly the same time, taking our organization from a
financially viable entity to one facing a multitude of financial
woes. This was certainly a turn of events since our previous
audit was very clean and unqualified."
The unaudited report listed $165,859 in accounts receivable
and $345,544 in accounts payable.
Cash declined from about $1.8 million to about $600,000.
Total current assets as of Sept. 30, 2000, were $887,862
vs. $2,052,826 a year earlier.
"The good news," said Williams, "is that
we're not talking about deaths; the not-so-good news is
that IABC will need to dramatically change the way it does
business to get through the storm. That, most of all, means
becoming a marketing-driven business that creatively applies
its resources to revenue enhancements, quickly, and over
the long term."
The group is having its annual conference in New York in
University of Maryland college of journalism has received
a $10 million gift from Philip Merrill, 66, who publishes
The (Annapolis) Capital, the Washingtonian Magazine,
and a chain of suburban papers. Merrill, 66, is a former
State Department spokesman. The school, which dropped its
PR curriculum last year, will be named the Phillip Merrill
college of journalism. His wife, Eleanor Merrill, chairs
the board of the journalism school.
Edition, February 21, 2001, Page 8
huge losses posted by PRSA and IABC (pages 1 and 7) raise
questions about the candor of the officers responsible for
Rosy views of the finances of each have been circulated
among the members for years.
Leaders of PRSA have been predicting a break even year for
2000 even after saving more than $100,000 by not printing
the Bluebook of members and cutting other services.
We wonder if the loss at PRSA for 2000 was close to the
$1 million mark. IABC has admitted a loss of this size in
an unaudited report.
PRSA is making its members wait for the audit although this
could be as long as two months away. The habit of the board
was to pocket the annual audit until there was a board meeting.
That's how members for years got their audit in the middle
of summer or even fall.
Current leadership promises the audit will be given to the
members right away.
Debra Miller, by the way, the 1997 president of PRSA,
put out a full unaudited report for 1996 in late February
of 1997, showing there was no need for the board to "sit
on" the figures for so long. The National Investor
Relations Institute, also with a Dec. 31 fiscal year, typically
puts out an audited report in February.
Part of the blame for the poor finances and poor financial
reporting of the two organizations is being laid at
the doorstep of the paid staff.
Insiders at the two groups tell us the staffs of each got
"too much power." This was aided by the bloated
boards of each (25 members for IABC and 17 for PRSA). The
bigger the board, the weaker it is. Power gets lodged in
a few staffers since the boards find it hard to make up
The top staff officers and top financial executives of both
PRSA and IABC left these groups at short notice.
It could be the American Society of Assn. Executives urges
its members to get as much power and titles as possible,
including president and CEO.
An ASAE spokesperson said the ASAE has no such policy and
we believe it. What happened is that the weak elected officers
of the two groups allowed staff to get this power. IABC
has now removed the title of CEO from its top staff officer.
PRSA has installed as president and COO a career PR professional
after nearly 20 years of having the staff headed by a non-PR
Betsy Kovacs, who headed the PRSA staff for 13 years until
the end of 1992, was succeeded by Ray Gaulke, a career advertising
and publishing executive. Rea Smith was the last PRSA member
and PR professional to head the staff.
Military PR junkets are much in the news these days because
of the submarine Greeneville's blunder into an unsuspecting
Japanese fishing vessel.
This disaster could put an end to such junketing. PRSA staff
and leaders went on such a junket in 1997 (4/16/97 NL).
The tour was described by Dave Murray, a reporter for The
Also on it were PRSA president Debra Miller and PRSA COO
Others on the "Partners in PR Tour," which involved
a tour of U.S. Air Force bases in Texas and Florida March
5-6, 1997, were Jane Cabot of M Booth & Assocs.; Cos
Mallozzi, Gibbs & Soell; Kent McKamy; Ed Orgon; Brian
Rafferty; Peter Rush, Sumner Rider; Stephen Sigmund of Robinson
Lerer & Montgomery; Morris Silver; Idan Sims, and Hal
Warner, 1993 PRSA president.
Air Force PA chief Ronald Sconyers (now with the Kids in
a Drug-Free America foundation) helped conduct the tour.
He said that public support of the AF was needed but that
government rules prohibited normal PR practices. He told
those invited to tell their friends "what the AF can
The group, some of whom were picked up in New York and flown
to Texas, Florida and back, saw an F-15 show, a helicopter
maneuver, and a performance by the AF band.
Sconyers said similar tours were scheduled for Fortune "100"
CEOs, doctors and other influentials.
The AF guests paid $135 each to offset their expenses. The
tour came just before the AF rolled out its first $71 million
F-22 fighter jet.