TSI SLASHES 65 FOLLOWING $10M IBM LOSS

TSI Comms. is laying off 65 people in the wake of losing its $10 million IBM account, according to Kelly Fitzgerald, president of the IPG unit. Sixty-two of the staffers are in New York, she told this NL.

The layoffs are effective Sept. 30 when the IBM contract expires. Fitzgerald said the affected workers were notified last week so they would have the "resources" of the agency for about another 40 days.

TSI has also instituted 20 percent pay cuts for remaining staffers until "we rebuild our book of business," she said.

Fitzgerald said business had been strong this year until IBM announced its PR consolidation bombshell earlier this month. TSI now has 32 staffers in New York, 10 in San Francisco and five in London.

BRITISH 'INVEST' $720K IN MWW GROUP

The MWW Group has a $60,000-a-month PR contract with Invest UK, the British government agency which promotes global investment. The contract is for one year. The contract covers a "perception audit," database and online marketing, media and analyst relations, ambassador and role model development, trade shows and creation of affinity relationships.

MWW is to be rated on the number of "qualified leads" it develops in the technology, life sciences, financial services, automotive and telecomms. sectors.

Applied Communications has lost the Oracle business, one of its biggest accounts. The software giant has shifted the estimated $1 million account in-house. Under CEO, Larry Ellison, Oracle was a leader in "smashmouth PR." Its stock, like other high-tech companies, now trades near its 52-week low of $13 a share. Hewlett-Packard, Veritas and the just acquired Verisign are AC's top accounts...GCI Group received $375,000 from the British Tourist Authority to counter media hysterics about "mad cow" "foot and mouth," and other image disasters for the U.K. The contract expires at the end of this month, according to GCI's contract filed with the Justice Dept...The White House Office of National Drug Control Policy has put the $160 million anti-drug media campaign that is handled by Ogilvy & Mather up for bid as the Justice Dept. is probing O&M's billing practices...Kevin Pastel has left Porter Novelli to become managing director at Publicis Dialog's San Francisco office. Before PN, he was a VP at EvansGroup, which was merged into PD.

B-M IS IN AT ORBITZ; KETCHUM IS OUT

Orbitz.com, Chicago, has given Burson-Marsteller an expanded role in the handling of its Internet travel reservation website.

B-M, which was overseeing just government affairs, is now Orbitz's agency of record.

B-M has named Nancy J. Friedman PR, a New York-based firm, to provide media relations for Orbitz.

Friedman PR replaces Ketchum, San Francisco, which had handled the website since it was launched three months ago.

Carol Jouziatis, who is Orbitz's VP of corporate communications, met with Friedman PR on Aug. 20 to go over plans, which are expected to include more media events, and sponsorship of the Society of American Travel Agents' annual convention.

P&G RETAINS RUDER FINN

Procter & Gamble has retained Ruder Finn, New York, for a three-year PR assignment for a new over-the-counter healthcare product that is still under wraps. RF beat out five other firms in the review.

Mary Trudel, RF's EVP/director of consumer healthcare, said details of the assignment will be disclosed in the near future.

Kathy Bloomgarden, CEO of RF, said it was a "high priority assignment" that calls for the firm to handle the new product launch via print and broadcast activities, promotions and special events.

WESTHILL COUNSELS PACIFICA RADIO

Pacifica Radio has hired Westhill Partners' PA unit to boost ratings for its five stations and provide counsel as the company deals with employee-management conflicts and a national grassroots campaign targeting its board.

"We're acting as counselors on a number of management and branding issues," Michael Powell, a partner in the PA practice who heads the account for Westhill, told this NL.

The Pacifica board is facing lawsuits from former staffers and listeners and answering allegations of opposing union organizing efforts and gagging on-air discussions-charges which the board denies.

Pacifica holds licenses to listener-sponsored stations in New York, Washington, D.C., Houston, Los Angeles and Berkeley, with the public affairs show "Democracy Now!" among its programming.

Westhill previously handled crisis communications for Jesse Jackson and Bob Kerry.

PR PROS RATE CONDIT'S PERFORMANCE

This newsletter asked PR pros how Rep. Gary Condit fared in his interview last week with Connie Chung on ABC.

Bill Huey, president, Strategic Communications, Atlanta, said the "'limited modified hangout' has never worked. Not during Watergate, not now.

"Condit's canned non-denial denial about his affair with Chandra Levy looks innocuous enough in print, but in front of a camera it reeks of the media advisor and the lawyer.

"Condit should come clean and do it quick. If he has nothing to hide, he has nothing to fear," he said.

Michael Marinello, director of corporate development at the GCI Group, said that nobody has hit upon the line of questioning Connie Chung should have pursued. Chung's questioning should have begun with: "Congressman Condit, how do you reconcile your harsh criticisms of President Clinton during the Lewinsky scandal, and your current actions?", said Marinello.

Condit Was "Programmed"

Lee Laino, a New York-based PR consultant, said: "You would think Condit would have learned something from Clinton.

"He came across as totally programmed, out of touch with what the American people wanted to hear, and evasive throughout on the core issues.

"He even spoke of Chandra in the past tense which did nothing to assuage a perception of culpability. His situation was irremediable.

"From a PR standpoint his strategy failed," he said.

Richard Nicolazzo, president/CEO, Nicolazzo & Assocs., Boston, said Condit's interview was "well choreographed but lacking in substance."

Too Plastic

Joyce Newman, president of The Newman Group, New York, presentation and media training firm, said Condit was "too plastic and over-rehearsed...he sounded as if hoarse...I would flunk him on his presentation."

Carol Ruth, president of The Ruth Group, New York, said that Condit "split too many hairs" in describing exactly what he told Chandra Levy's mother about his relationship with Chandra.

"He's underestimating the public," said Ruth. She feels that his relationship with Chandra makes him a "terrible role model" for the U.S. "Our elected leaders should exhibit the highest forms of behavior," she said.

Lou Rena Hammond, president of Lou Hammond & Assocs., said the interview brought "nothing new to the public."

Jerry Schwartz, president of G.S. Schwartz & Co., said there were "many discrepancies" between what Condit told Chung and what has already been reported in the media. The police have said he told them he had an affair with Chandra but Condit himself will not admit this to the public, perhaps because of legal reasons, said Schwartz.

FRANKEL'S USPS LEAFLET RILES REFUGEES

The U.S. Postal Service is discarding a new brochure showing the Vietnamese flag after a former South Vietnamese soldier living in San Jose, Calif., protested the use of the communist national symbol.

Gerry Krienkamp, a USPS spokesman, said the multilingual pamphlet, "A World of Services to Meet Your Needs," was created by Frankel & Co., a Chicago-based marketing/PR firm.

The pamphlets, which are being removed from 11,900 post offices, used national flags to denote text in English, Italian, Tagalog, Polish, Spanish, Vietnamese and Korean.

The flag issue was raised by Thiem Chanh Le, who came to San Jose after 11 years in a communist reeducation camp.

In a letter to the postmaster general, Hung Quoc Pham, president of the Vietnamese American Community of Northern California, called the use of the flag "a disgrace" and "similar to raising a Nazi flag to the Jews."

GRAND JURY GETS GRUBMAN CASE

A grand jury in Riverhead, N.Y., has begun hearing evidence on whether to indict New York PR professional, Lizzie Grubman, for backing her car into 16 people at a nightclub in Southampton, N.Y.

An indictment and conviction could lead to up to 25 years in prison for Grubman, of Lizzie Grubman/ Peggy Siegel PR.

Suffolk County prosecutors are expected to call several witnesses-from forensics experts to waiting-line witnesses-to prove Grubman had intentionally backed her 2001 Mercedes SUV into a crowd of people who were standing outside the Conscience Point Inn on the evening of July 7.

Scott Conlon, the club's security supervisor, was scheduled to testify on Aug. 22, according to Mike Paul, who is handling PR for Conlon and his attorney.

Those outside the nightclub told police Grubman backed her father's SUV into the crowd after arguing with Conlon.

Conlon, who was injured in the crash, alleges that he was called "white trash" by Grubman after he asked her to move her car from the fire lane and she refused.

Conlon's attorney later accused Grubman of being on drugs at the time and said Conlon was joining a number of other crash victims in suing Grubman, her father, entertainment lawyer Alan Grubman, and Mercedes-Benz for more than $90 million.

The grand jury's deliberations, which are secret,could take two weeks, said Drew Biondo, spokesman for Suffolk County District Attorney James Catterson.

MILLER/SHANDWICK LOSES PRESIDENT

Tony Sapienza, who has been president of Miller/Shandwick Technologies, Boston, since 1998, has left the agency, which is part of the Interpublic Group of Cos.

He could not be reach for comment.

MISSING EDITOR'S PARENTS ASK FOR HELP

The parents of Claudia Kirschhoch-former editor with Frommer's Travel Guides who disappeared in Jamaica last May 27 while on a press trip-have asked U.S. and Jamaican officials for help in keeping the investigation alive.

The Morristown, N.J., couple met Aug. 15 in separate meetings with Sue McCourt Cobb, after she was sworn in as the new U.S. ambassador to Jamaica, and Richard Bernal, the Jamaican ambassador to the U.S.

Rep. Rodney Frelinghuysen (R-NJ), who arranged and attended the meetings, said Ambassador Cobb indicated she was committed to talking and meeting with the Jamaican prime minister and Jamaican authorities to find out what happened to Kirschhoch.

Bernal has promised to establish a contact for the Kirschhochs within the Caribbean island nation's law enforcement organizations. Over the past 15 months, the Kirschhochs have circulated fliers, set up a website seeking clues by e-mail and established a toll-free number for tips.

The 30-year-old editor disappeared after having breakfast with Tania Grossinger, who was on the same trip, at a hotel in the western resort town of Negril.

Kirschhoch's father said he still suspects a resort hotel bartender who took Claudia to a reggae concert the night before she disappeared. The bartender, who was given a lie detector test, has denied knowing anything about her disappearance.

TUCKER JOINS BUSINESS WEEK'S TV SHOW

Bill Tucker was named the host and managing editor of "BusinessWeek," a weekly TV personal finance and business program set to debut in the fall.

The program, which currently airs on Sunday mornings as "MoneyTalks," will be relaunched in October as BusinessWeek with Tucker and Jill Bennett, the current co-host, sharing anchor duties.

Tucker, 47, was previously a reporter and anchor for TechTV, where he covered the financial side of the technology revolution, and a business news reporter and anchor at CNN for 18 years, where he helped pioneer the network's coverage of business and financial news. In 1987, as producer of "Moneyline with Lou Dobbs," Tucker won the George Foster Peabody Award for coverage of the stock market crash.

Neal Cortell is senior producer/director of the nationally syndicated show, which is based on Business Week magazine.

The program is carried on ABC stations in New York, Los Angeles, Chicago and San Francisco, and the McGraw-Hill Broadcasting Group's owned ABC affiliates in San Diego, Denver, Indianapolis and Bakersfield.

PEOPLE _______________________

Amanda Bennett, who left The Wall Street Journal three years ago after 23 years there as a reporter to join The Portland Oregonian as managing editor of special projects, is leaving to become editor of The Lexington (Ky.) Herald-Leader.

She will succeed Pam Luecke, who will teach business journalism at Washington & Lee University.

Betsy Wade has stopped writing the "Practical Traveler" column for The Sunday New York Times. The column is being assigned to other writers by Nancy Newhouse, travel editor.

Joshua Levin, formerly senior editor of Forbes, is now a contributing editor.

Amy Barnett, Philadelphia bureau chief for Business Week, has returned from maternity leave, working from her home office, 856/616-9520.

Debbie Tennison, 51, who covered economic issues for The Wall Street Journal's London bureau in the early `80s, and then became a PR practitioner in California, writes a column under the name of "Selacia" for the Sedonna Journal of Emergence!, magazine for New Age followers. She also offers PR services, using New Age philosophy to communicate messages. Her website is TheGoldenWay.com.

MEDIA BRIEFS __________________

BizBash.com, a website that covers events, will hold a trade show Oct. 11 at the Javits Center, featuring 125 companies that help make up the city's special events business. BizBash is run by David Adler, former PR head at Primedia.

InternetWeek will unveil three new editorial sections and an updated website on Sept. 17.

The Manhasset, N.Y.-based publication's new section will emphasize the 'why' and 'how' of delivering e-business results, while the new website will focus on breaking news, case studies, product reviews, and research.

Rob Preston is editor-in-chief of InternetWeek, which is published by CMP Media.

Classic American Home, which began as Colonial Homes in 1975, will be shut down by Hearst Magazines.

The magazine was published every two months, and had a circulation rate base guarantee of 500,000.

The July-Aug. number is the last issue.

AlleyCat News, a magazine that stopped publishing last March after more than three years as a monthly, is back in business.

An 88-page issue, with 42 pages of ads, has been mailed to members of the New York New Media Assn. It is also sold on newsstands in Manhattan.

It will compete against Silicon Alley Reporter.

Anna Wheatley, editor-in-chief, and Barbara Con-gelosi, managing editor, are at 580 Broadway, #1110, New York, NY 10012; 212/966-4242, ext. 107.

(Media news continued on next page)

RESEARCHERS MUST REVEAL FINANCIAL TIES

Nature magazine, which focuses its coverage on scientific research findings, will require researchers to disclose any financial interest related to their studies when they submit articles for publication.

The new disclosure policy, which will affect papers submitted after Oct. 1, will allow authors the option of not disclosing their financial interests, such as stock in companies that stand to gain from publication or consulting fees from organizations with a stake in publication. Nature will still publish the article in question, noting the author's refusal to make the disclosure.

Philip Campbell, editor of the London-based journal, said the goal is to "help the public form judgments" about the research by making authors' financial interests known.

The New England Journal of Medicine is preparing to announce a new policy that will require drug companies, who sponsor clinical trials, to permit researchers involved to publish the results even if they are not favorable.

MAGAZINE PICKS TOP TECH WRITERS

Technology Marketing said the most influential journalists that cover the tech business are:

Stephen Wildstrom, columnist for Business Week; Walter Mossberg, columnist for The Wall Street Journal; Bob Evans, editor-in-chief of Information Week; Jai Singh, editor-in-chief of News.com; Michael Miller, editor-in-chief of PC Magazine; Ron Insana, anchor of CNBC; Stephen Manes, contributing editor, Forbes/PC World/PBS, and Chris Shipley, editor of DemoLetter.

The magazine, which recently changed its name from Marketing Computers, said the "hottest tech media" were The Wall Street Journal, Business Week, Fortune, Information Week, USA Today, CNBC, New York Times, Forbes, C/net, and Red Herring.

The rankings were published in its July issue.

LAUNCH OF WWD.COM DELAYED

Fairchild Publications has delayed the start of WWD.com, the online version of Woman's Wear Daily, which had been scheduled to start on Sept. 10.

Mary Berner, Fairchild's president/CEO, said "the current business climate and market conditions" were reasons for putting the website on hold.

Fairchild had planned to charge $895 per year for an online subscription.

Rochelle Udell, former editor of Self magazine, is president of Fairchild Internet.

CNN TO ADD SECOND MORNING SHOW

CNN plans to start a new New York-based business and general news show on Sept. 10, anchored by Jack Cafferty, who currently anchors a morning show on CNNfn, which does not have a big national following.

Cafferty's new show, called "CNN Money Morning," will air from 6 to 7 a.m. on CNN and 6 to 8 a.m. on CNNfn.

The new show will replace "Ahead of the Curve," also a New York-based business and general news program, which is viewed on average in about 81,000 homes.

Cafferty, a veteran New York news anchor, will deliver the day's headlines and pre-stock market activity, plus related news.

INFORMATION WEEK TO LAUNCH OPTIMIZE

CMP Media's Information Week, will launch Optimize, a monthly magazine for business technology executives. The new publication, which debuts with the Nov. 2001 issue, will reach 70,000 CIOs, CTOs, VPs/IS and technology-involved corporate managers.

Brian Gillooly, editor-in-chief of InformationWeek Events, was named editor-in-chief of Optimize.

Gillooly said the magazine will cover new business technology theories, strategies and ideas.

PLACEMENT TIPS ___________________

StreetMiami (www.streetmiami.com), a free distribution weekly published by The Miami Herald, has named Jessica Sick to oversee features about new products, called "Itemize."

Editor Jim Murphy said the paper, which has a circulation of 72,000, is targeted at 18 to 34-year-olds.

Murphy said Sick can use information about new gadgets, gizmos, fashions, accessories, etc. "Just about anything really, as long as it's hip and trendy," he said.

All submissions must include art (jpg preferred).

Send information to: 1401 Biscayne blvd., 2nd flr., Miami, FL 33132; 305/376-4459; [email protected].

National Public Radio is cancelling "Talk of the Nation," a midday call-in show. The last show is Aug. 30.

The four-day-a-week show was heard on 180 stations by 2.2 million listeners.

Juan Williams, a former reporter for The Washington Post who had been host of the show for only 18 months, will become a senior correspondent for NPR news, appearing twice monthly on "Morning Edition" and "Weekend Edition."

YM magazine's new address is 15 East 26th st., 4th flr., New York, NY 10010. The new phone number is 646/758-0430; fax: 758-0808.

Commonwealth Business Media, Los Angeles, is buying the Journal of Commerce Group for about $45 million. The group consists of JoC Week, formerly the daily Journal of Commerce, Traffic World, Air Cargo World, Florida Shipper, Gulf Shipper and Shipping Digest magazines, as well as databased publishing, websites and directories.

MEDIALINK FIGHTS TAKEOVER BID

Medialink executives and staffers are continuing business as usual despite a takeover bid by United Business Media, London, which also owns PR Newswire among many other companies.

UBM is offering $5 a share for Medialink's 5.8 million shares or about $29 million.

Since Medialink's sales were $56.5 million in 2000, this would be a bargain price for UBM. Communications firms often sell for at least the value of their annual sales.

The company, which specializes in video and audio services, went public in 1997 at $9 a share and saw this reach $28.75 in 1998. Recent low was $2.18. Following UBM's bid on Aug. 14, the stock rose close to the $5 price.

Laurence Moskowitz, Medialink CEO, said the firm is providing its usual "excellent services" to clients and that it remains "the employer of choice for our 310 valued staff members."

UBM Undergoing Major Changes

UBM is listed on NASDAQ (UNEWY), where its stock has shown little growth since 1994 (rising from about $7 to $8 currently).

It undertook a massive sale and closure of certain publishing assets in 2000, reporting a gain of about $3.1 billion from such sales. Revenues decreased 9% to about $2.8B. At the end of 2000, UBM had $3.15 billion in cash and short term investments. Investments in the first half brought this down to about $1.5B. (Pound = $1.45.) UBM said in early August that it is purchasing Roper Starch Worldwide for $88M in cash.

UBM said in late 1999 that it was ridding itself of many assets in order to concentrate on the "New Media" markets. One purchase included CMP Media, owner of Information Week, Computer Reseller News and Network Computing and which also operated 60 Internet sites such as TechWeb, the EDTN Network and Channel Web.

UBM, saying that business conditions in the first six months of 2001 "have been extremely tough," reported a loss of 8.9 million pounds on revenues of 490.7 million pounds for the half.

CEO Clive Hollick said he expects no U.S. upturn this year. News distribution (including PRN) brought in 21.2M pounds in profit in the first half, up 1%, on sales of 66.9M pounds, up 11%.

UBM recently dropped 700 employees, or 9% of its staff, and said more layoffs may be necessary.

Biggest sub-division of United is Miller Freeman, tradeshow organizer and business magazine publisher. It handles 450 exhibitions and conferences and has nearly 440 publications.

Kekst and Co. handles PR for UBM including the offer to buy Medialink. No formal tender offer has been submitted thus far.

Major Owners Listed

Major owners of Medialink include Moskowitz, with 360,011 shares; Brown Capital Mgmt., Baltimore, with 1,541,300 shares; FMR Corp., Boston, with 567,100 shares; DFA Investments, Santa Monica, Calif., with 320,200; New York State Retirement Fund, with 261,585, and Vanguard, with 115,500.

The company had net of $2,057,000 for the year ended Dec. 31, 2000, or 35 cents per diluted share. Its revenues were $26.8M for the first half of 2001 vs. $28.6M for the same 2000 period. Net loss for the six-month period was $935,000, or 16 cents a share, including one-time charges of $408,000. Net for the first half of 2000 was $1.3M or 21 cents per share.

Current debt is $4 million.

The Delahaye Group, research firm, was acquired on March 12, 1999 for 185,666 shares worth $2.8M. Delahaye had 1998 sales of $4,002,930 and a net loss of $989,981.

Medialink entered into a joint venture with Business Wire on Aug. 1, 1999 to form Newstream, which connects clients to multimedia Internet news sites as Newstream.com. The service allows reporters and editors to seek or have sent to them news of industries in which they are interested. Each company made an initial capital investment of $2M plus acquisition costs.

Newstream had revenues of $940,000 in 2000, an operating loss of $2,228,000, and a net loss of $2,152,000.

Stockholdings, Salaries Listed

Executives with major stockholdings, besides Moskowitz, include J. Graeme McWhirter, executive VP, CFO, secretary and a director, 202,729 shares, and Richard Frisch, SVP and executive officer, Medialink MCTV division, 73,586. Mark Manoff, former executive VP/U.S., who is now a consultant to the company, had 90,014 shares as of April 13.

Moskowitz was paid $401,648 in salaries and bonus in 2000; Frisch, $563,383; McWhirter, $346,241; Manoff, $376,188, and Nicholas Peters, SVP/broadcast services, $201,575.

WPP EARNINGS REPORT IS MIXED

WPP Group said its profit before interest and tax rose 73% to $399.9 million for the six months ended June 30 despite tough economic conditions.

Revenue rose more than 65% to $2.875 billion and up over 58% in constant currencies.

WPP said the prospects for revenue growth for the latter half of 2001 may be even more difficult, although industry projections for advertising market growth in 2002 look slightly better than 2001.

"The over-riding concern is that what has essentially up to now been a business-to-business recession will spill over into the consumer sector," WPP said.

The report said the recession had "most significantly" affected the PR sector, with like-for-like revenues falling by over 3%. The company attributed the drop to a slowdown in technology, media and telecommunications.

As a result of acquisitions, PR and PA revenues rose by 105% in the first six months, WPP said.

PR OPINION/ITEMS

United Business Media, London, owner of PR Newswire, which is mounting a hostile takeover of Medialink (page 2), one of PR's biggest
service firms, is itself undergoing momentous changes.

UBM sold more than $3 billion of its assets in 2000 and wound up with $3.15B in cash and short term investments as of Dec. 31, 2000. This was cut to about $1.5B as of June 30, 2001 via acquisitions. UBM CEO Clive Hollick says the company "is driving to become the leading provider of market information services in its chosen high growth sectors."

Its stock on NASDAQ (UNEWY), currently around $8, has shown little improvement since January 1994 when it was about $7. It spiked to around $20 this spring but quickly fell back.

UBM would no doubt like to add more companies like PR Newswire in the U.S.

UBM's News Distribution group, which includes PRN, brought in about $95M in the first half and had operating profits of about $30M. Other income of UBM in the first half included about $450M from professional media and about $110M from market research. It had a loss for the first half of about $15M on revenues of about $750M (British pounds have been translated into dollars at $1.45). Annual revenues had been running at a rate of around $4.5B until UBM made the gargantuan selloff
of its assets.

Medialink executives, while not thrilled by the proposed takeover, nevertheless must show they are living up to their fiduciary duties. Merger experts say they are probably trying to find a "white knight" that will offer more than the $5 a share UBM is offering.

Medialink has grown importantly via acquisitions and not all of them have been moneymakers. Its low stock (falling from $28.75 to $2.18) made it a sitting duck for a takeover attempt. This holds true for the other "aggregators" in the communications field. When Young & Rubicam's stock dipped from $70 to $40 last year, it was quickly snapped up by WPP Group. Interpublic has seen its stock dip from $58 to the mid $20's, cutting about $8 billion from its capitalization.

If a conglomerate's stock falls too low, it becomes a tempting prize for the takeover crowd since its parts, which are more valuable than the whole, can be purchased en masse and sold off piecemeal.

Barron's Online wrote about Omnicom, Interpublic and WPP Aug. 20 and there is no indication that any of the top execs at the three conglomerates talked to reporter Dimitra DeFotis. None are quoted. The article says there appears to be "skepticism" about the ad/PR group because of current tight ad budgets. Omnicom is trading at 21.5 times cash flow for the past 12 months, well below its historic multiple of 24 times trailing cash flow and far below its peak of 33.6 times trailing cash flow, the article noted, quoting Thomson Financial/Baseline. Robert Coen of Universal McCann (part of Interpublic) told Barron's that ad revenues in the second half will show a gain from last year's second half because the dot-coms heavily spent on ads last year until the second half of 2000.

DeFotis said OMC is outperforming IPG and WPP (more than 50% off their all-time stock highs) because of successful acquisitions and growth
from existing clients.

Milk containers, which have been bragging in recent years about having "1%" or "2%" fat content, are now switching to "low fat" and "reduced fat" claims and away from numbers under new rules of the Food & Drug Administration.

The "1%" and "2%" claims were specious because
buyers were not told (except on the back of the milk cartons) that whole milk only contains about 3% fat. Most people we talked to thought "1%" meant the milk contained 1% of the normal fat content when in reality it contained about 33% of normal fat content. Under
the new FDA rules, milk with up to 37.5% of normal fat content can now be called "low fat milk" and "reduced fat milk" can contain about two-thirds of normal fat.

Milk sales have been in a tailspin for decades, falling from 34 gallons per capita in 1955 to 23 today. The "milk moustache" campaign via BSMG Worldwide appears to have stopped the decline, according to statistics of the independent Beverage Marketing Corp. Growing at a 16% annual rate are bottled water sales. Americans downed 18 gallons on average in 2000 and soon will be drinking more bottled water than milk. The water is highly profitable for all concerned. At one New York movie theater, a bottle of soda and a bottle of water the same size each sold for $1.85. Some consumers are so intent on not drinking soda that they'll pay an outrageous price for mere water! Soda sales were flat in 2000 at 55 gallons per capita.
--Jack O'Dwyer

"Neutron Jack" tells all. General Electric CEO Jack
Welch--who is expected to be retired by October--addresses the Williams Club on Oct. 12 about his golden career at GE. He also is expected to tell why GE remains dead set against dredging the Hudson River in light of Bush Administration support for the plan. The breakfast
event will be held at The Columbia Club. Jack will be handing out "Jack: Straight from the Gut," his soon to be published management memoir that earned him a $7 million advance. CNN's Walter Isaacson will lead the discussion.
--Kevin McCauley