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Internet Edition, October 10, 2001, Page 1


Burger King has selected Weber Shandwick Worldwide for several global PR assignments, according to Richard Taylor, VP-global advertising and promotion at the $11.2 billion fast-food restaurant chain.

Gail Heimann, president of WSW's global consumer marketing practice, heads the account from the PR firm's New York office. She says Cathy Calhoun, president of WSW/Chicago, and Christine Barney, who heads the WSW office in BK's headquarters city of Miami, will also work on the business.

Kim Miller is BK's PR director. She said the contract with WSW has not yet been finalized. The chain did not have an agency of record.

BK served up bad news for WSW sister company, McCann-Erickson. It lost the chain's $400 million ad account after a nine-month stint.

BK, a unit of Diageo, suffered a 12 percent decline in operating profit for the fiscal year ended June.

Diageo doesn't foresee a rebound until next year. It has installed new management to "restore market share and improve operating performance," according to its financial statement released last month.


Porter Novelli's Chuck Greener has departed the Omnicom unit for the senior VP-communications slot at Fannie Mae Corp., the nation's largest source of financing for home mortgages.

Rob Gould, U.S. director of the firm's global healthcare practice, succeeds Greener as general manager of the Washington, D.C., office.

He will continue to work on the American Cancer Society account and on anti-smoking campaigns. Gould began his PR career at PN in 1984.

Greener was director of communications for the Republican National Committee before joining PN in 1995. He also was special assistant for legislative affairs during the Reagan Administration.

At PN, he counseled TheSteelAlliance, Robert Wood Johnson Foundation and Nextel.

EAW Group has signed a two-year contract worth $1 million to represent The Gambia. "The focus is on economic development, government affairs, media relations and to a lesser extent tourism promotion," says John Aycoth, CEO of the Washington, D.C.-based firm. The contract went into effect on Sept. 1. "We've already received payment in full for the first year," Aycoth added.


Magnet Communications, a unit of France's Havas Advertising, has cut 12 PR staffers in New York and California to cope with the slash in spending for PR that has affected every agency, says David Kratz, CEO of the firm. It also cut 11 administrative staffers.

Magnet laid off 36 staffers in June.

Havas Axes 1,200

Havas stunned investors last week by announcing that it lost seven million euros for the first-half of this year compared to a 45 million euro profit a year ago. That news dropped Havas' stock price to $5.34, a three-year low.

CEO Alain de Pouzilhac plans to lay off 1,200 staffers or five percent of its global workforce.

Havas reduced its operating profit margin goal of 15 percent to 10-12 percent this year because the firm expects a recession in the U.S.

"We are living in a world that is in recession. When there is a recession, one has to adapt to it," he said.

Havas expects U.S. ad spending will drop six to nine percent this year, and possibly three percent in Europe.


Ruder Finn has hired Nancy Glick, Hill and Knowlton's top healthcare person in Washington, D.C., as executive VP.

"I joined RF partly because it has a big cancer communications practice," Glick, a survivor of a rare form of lymphoma, told this NL.

Finding a cure for cancer is a cause that Glick is "passionate" about.

Glick is currently working on a campaign for Johnson & Johnson's McNeil consumer healthcare group. It is a public education campaign to highlight the importance of using over-the-counter drugs responsibly. "Over the counter drugs are sold right next to gum," she noted.

Glick will develop alliances with health, medical, nutrition, consumer and patient groups.

The one-time press officer for the Food and Drug Administration will also work on food and nutrition issues.

Glick had been at H&K since 1979. She is rejoining Ken Rabin at RF. He is the former chairman of Burson-Marsteller's health group, who left H&K as executive director/healthcare to launch InterScience in 1992.

Internet Edition, October 10, 2001, Page 2


Fitch, one of the leading credit rating services, has downgraded senior unsecured debt of Interpublic from A to A- and its multi-currency bank credit facility from A to A-.

Protracted earnings weakness could result in "further weakening of credit protection measures," it said.

Convertible subordinated notes, of which IPG has $540 million outstanding, were downgraded from A- to BBB+, and commercial paper (short term loans) was downgraded from F1 to F2. F1 is the highest rating given by Fitch, one of the major rating services along with Moody's and Standard & Poor's.

The ratings change, dated Sept. 17, cites "IPG's weakening earnings trends combined with sizable cash costs to implement a restructuring and corporate reorganization."

IPG's stock has fallen from a high of $58 in January 2000 to around $20 currently. Its market capitalization has gone from $17 billion+ to $7.5B.
Revenues fell 4% in the second quarter and are flat for the first half, "trailing the performance of major competitors," said Fitch.

It says cost cuts have not kept pace with lower revenue trends resulting in a "significant decline in operating cash flow."

TN Merger Means $500M Charge

IPG will take $500 million in charges in the second and third quarters to integrate its True North acquisition, reorganize other agencies, and reduce operating costs.

The charges, which are "significantly larger than previously anticipated," will involve staff cuts of 3,500 and the closing of some 75 offices worldwide. These cuts follow layoffs of 2,200 in the first half for a total of 5,700, or about 10% of the workforce.

The "Negative Rating Outlook," says Fitch, "reflects uncertainties about the time and degree of recovery of client advertising and concerns about the ability of the company to smoothly effect the largest-ever realignment of its business amid the current market slowdown."

IPG is trying to conserve cash over the near term but "protracted earnings weakness could result in further weakening of credit protection measures," said Fitch.

IPG, which has $7 billion+ in revenues, as of June 30 had $1.4B in long term debt; $1.3B in short term debt and $540M in convertible bonds.

Fitch notes that IPG's client base is large, diverse and highly stable, giving it "distinct competitive advantages in the acquisition and retention of clients." But it is also afflicted with the "lack of tangible asset protection associated with a service business."


Coca-Cola has hired Holland & Knight to ward off Federal restrictions on "vending machines" in schools, according to the firm's Lobbying Disclosure Act.

Sen. Patrick Leahy, who represents dairy state Vermont, has introduced a bill that would prohibit schools participating in the national school lunch program from selling soda and candy.

"The Better Nutrition for School Children Act of 2001" tightens U.S. agriculture rules under the lunch plan. It requires that "sodas and other unhealthy snacks not be sold or given to students in school during meals."

Leahy, when introducing the bill, noted that many schools earn revenue via exclusive contracts with soft drink companies and commissions on sales.

The Democrat, however, said children should "not pay the price when we give soft drink companies free reign to market their products in schools," said Leahy.

H&K partner Michael Hatcher along with Weldon Latham, Amy Nee and Susan Santana are lobbyists for Coke.


The Benjamin Group has picked up the Brocade Communications Systems account in a pitch that began in July with about 20 PR firms in the running. Voce Communications, which is located in Brocade's San Jose home city, had handled the account.

Benjamin, an Interpublic unit, will handle corporate and product positioning for Brocade, which chalked up $84 million in net earnings on $530 million in revenues for the fiscal year ended July. Chris Bateman, who is general manager of Benjamin's Silicon Valley office (Campbell), handles the account. He is assisted by Jodi Baumann in the firm's San Francisco office.

The NASDAQ-listed company traded as high as $133.71 per-share during the past year, but has tumbled to the $13 range with the overall collapse of the high-tech market. Morgan Stanley, last month, lowered its 12-month target price for Brocade from $36 to $22. It did laud the company as the "leader in the storage area marketspace," while cutting its forecast due to "uncertain economic conditions."


Former New York Congresswoman Susan Molinari has been named president/CEO of Ketchum's Washington Group lobbying wing.

Molinari will enable WG to "offer a strong campaign style approach to public affairs," said Ray Kotcher, CEO of Ketchum.

She had been running her own lobbying firm in Washington.

Molinari represented Staten Island and Brooklyn in Congress from 1990 to 1997. She made her mark on the national stage when she delivered a keynote address at the Republican National Convention, nominating Bob Dole for president.

Molinari is married to former Congressman Bill Paxon from upstate New York.

WG has done work for Bridgestone/Firestone, Microsoft, Kodak, Boeing, Americans for Consumer Education & Competition and the E-Fairness Coalition.

Internet Edition, October 10, 2001, Page 3


The "Nightly Business Report" has temporarily reopened its New York bureau at Ketchum/New York, 711 Third ave., according to Mark Landsman, who is NBR's assignment manager in Miami.

The bureau had been in 74 Trinity pl., which is two blocks away from what was the World Trade Center. The bureau was closed in the aftermath of the Sept. 11 attack.

For almost two weeks following the attack, the New York newsroom staff of 12 was operating out of the Doubletree Hotel in Times Square, until the temporary office space was found at Ketchum.

Scott Gurvey, senior correspondent who handles New York story assignments, is using the office.

Susie Gharib has been co-anchoring live from the New York Stock Exchange since Sept. 17.

Landsman said publicists should call Althea Thompson, one of the producers, to pitch information. She can be reached at 646/935-4274.

WSJ at Five Locations

The Wall Street Journal, which had to be evacuated from 1 World Financial Center on Sept. 11 as the Twin Towers across the street fell, now has reporters and editors working out of five newsrooms.

Paul Steiger, managing editor of the Journal and other top editors are still using offices in South Brunswick, N.J., where Dow Jones has a production plant, but other staffers are being relocated to offices in Manhattan.

The landlord for 1 World Financial Center expects to have the building ready for occupancy by mid-November.

Some 150 reporters, including the entire staff of the "Money & Investing" section, are being moved to 100 Sixth ave., a building in SoHo.

The Journal also is relocating staffers to 1155 Sixth ave., where DJ already had four floors.

Editorial writers and the staff of the "Weekend Journal" will move to a Seventh ave. building, and some reporters are working from Dow Jones Newswires office in Jersey City.


Women's Business has published the first issue of its New York edition. The paper also publishes a Boston edition. Both monthly papers will feature profiles of women business and professional leaders in all fields, including PR.

The New York edition's area of coverage is N.Y., N.J., and Conn. The Boston edition covers Mass., N.H., and R.I.

Stacey Corso is editor of WBNY. She is located at 880 Third ave., New York; 212/980-5777; fax: 980-4434.

Helen Graves is editor of the Boston edition. Her office is located at 1 Pond Park rd., Hingham, Mass.; 781/749-8500; fax: 749-8501.

More information is available on the paper's website at

The Las Vegas Review-Journal has started a quarterly magazine, called Cerca, which is Spanish for "close" or "nearby."

The magazine will focus on scenic destinations in southern Nevada, which are within reach of urban Las Vegas.

A.D. Hopkins is editor of the magazine, which will be sold in bookstores and on newsstands and mailed to more than 7,000 subscribers.

The Chicago Tribune has started a new employment section, called "CareerBuilder."

The section's content includes advice on career planning and job searching; profiles of prominent Chicago-area business people, and local and national job listings.

Publicists can submit information to the section by fax (312/222-4328) or e-mail ([email protected]).

Trades Publishing Inc., Lambertville, N.J., will begin publishing a new magazine called Jobsite- Tools and Materials for the Framing & Drywall Professional.

The magazine will be published six times per year beginning with the December 2001/January 2002 issue.

The publication, which will be aimed at contractors and distributors of framing and drywall, is a repositioning of TPI's current Interior & Exterior Wall, Ceiling and EIFS title.

The format will still focus on tools and materials but will be broken down into the following sections: metal framing, wood framing, drywall installation, drywall finishing, decking, add-ons, and accessories.

David Cane is editorial director. He can be reached at 609/397-5601.

Glamour's November issue, which hits newsstands in mid-October, has a revamped beauty department, additional health and nutrition columns, and more information on money and careers.

Cindi Leive, who replaced Bonnie Fuller as editor last May, has remade the beauty and fashion section to focus on service, with columns including "How Can We Help You?" (answering readers' beauty queries) and "Fashion Workbook," which reports on affordable clothing for readers interested in the designer-wear shown in Glamour's pages, and tips on how to mix and match.

She has also revived a column called "How to Do Anything," which shows women how to do things from changing tires to folding clothes.

Carol Abaya, who started The Sandwich Generation magazine in 1992, has started a website: Like the magazine, and her syndicated newspaper column, the site addresses aging and elder/parent issues. Abaya can be reached at 732/536-6215.

(Media news continued on next page)

Internet Edition, October 10, 2001, Page 4


Stock market losses have forced the Freedom Forum to close four offices and its First Amendment Center at 580 Madison ave. in New York.

The offices, which included an auditorium and state of the art video services, were used by other groups, including the Overseas Press Club.

The other offices being shut are in London, Buenos Aires, Hong Kong and Johannesburg.

The First Amendment operations will be shifted to the Freedom Forum's headquarters in Arlington, Va.

The foundation said stock market losses have amounted to about 30% of its $1 billion endowment, which consists of 200 stocks.

The Freedom Forum was started in 1991 by Al Neuharth, who founded USA Today, while he was head of the Gannett Co. The forum, which replaced the Gannett Foundation, is not affiliated with the Gannett Co., which owns USA Today.

Last year, the foundation paid the District of Columbia government $100 million for property on Pennsylvania ave. near the Capitol to build its new headquarters, which will include offices, a restaurant, retail space, condominiums and the Newseum. The Freedom Forum plans to relocate to Washington in 2005.


The November issue of Mademoiselle, a fashion magazine for young women that was first published in 1936, will be its last, according to Steven Florio, president of Conde Nast Publications, which is owned by the Newhouse family.

Newhouse has owned the magazine since 1959.
The magazine's subscription list will be fulfilled by Glamour, also published by Conde Nast.

Glamour will raise its rate base-the amount of circulation it guarantees advertisers-by 100,000 to 2.2 million in January.

The afternoon Syracuse (N.Y.) Herald-Journal, also owned by the Newhouse family, printed its last edition on Sept. 29. The paper began its existence in 1839 as the Western State Journal and merged with the Herald in 1939.

Its Sunday edition, the Herald-American, will bear the name of The Post-Standard, a morning newspaper.


The Manhattan Media Group, which publishes four weekly papers, is planning to start a new paper with an investigative bent to cover New York City government.

Tom Allen, CEO, said the paper may start as a monthly and a daily fax, with Sydney Schanberg as editor-in-chief. The tentative name of the paper is City Hall.

MMG's other weekly neighborhood papers are Our Town, West Side Spirit, Chelsea-Clinton News and the West Sider.

Schanberg, a former reporter for The New York Times and a columnist for Newsday, whose wife is a reporter for The New York Daily News, said the new paper is being started in the "belief that the mainstream papers don't do a particularly good job" covering New York government.

He said the mainstream papers are "leaving lots of gaps, avoiding stories on an ever-expanding roster of sacred cows."

Schanberg, who is currently writing a column for the other weeklies, has begun to hire and assign stories for the new paper. He can be reached at Our Town's offices at 242 W. 30 st. 212/268-8600.


Investor's Business Daily is introducing a new design and content. Editor-in-chief Wes Mann said the paper will expand business and management coverage in the first section; add a third story to its front page, along with color photos, charts and data displays; and increase the number of items in its "To the Point" news summaries.

A quarterly custom magazine, called State Tech, will be produced by Ziff Davis Custom Media for CDW Government, a subsidiary of CDW Computer Centers.

The magazine, which debuts this month, will be sent to 100,000 senior-level information technology professionals at state and local government agencies. It will include articles about current issues and challenges, such as privacy and security.

The magazine will provide case studies of technology deployments along with interviews with CIOs who are using technology to streamline government processes.

Carol Venezia, who is editor-in-chief of ZDCM, in New York, will oversee State Tech.

The American Marketing Assn., Chicago, has started a new website for marketers called Marketers can access a variety of information on the free site, including white papers, business articles, and the latest news in marketing.

The New York Times is accepting registrations for its free online financial news site, which will debut on Oct. 9.

The Times said the new daily e-mail report, called "DealBook," will provide the "latest and most complete news about market-moving" happenings.

It also will print news reports from the Times and dozens of other publications including The Wall Street Journal and The Financial Times.

Andrew Sorkin, who is the paper's merger and acquisitions reporter, will be editor of the service.

Interline Adventures magazine, based in Austin, Tex., has suspended publication. The magazine was published by Grand Adventures Tour & Travel Publishing Corp.

Internet Edition, October 10, 2001, Page 7


A United Airlines pilot advised passengers not to be submissive when a hijacker makes his presence known on a plane, said Peter Hannaford, partner in the former Deaver & Hannaford PR/PA firm of Washington, D.C., and now in his own company, Hannaford Enterprises, D.C.

UAL's PR department has said it has been unable to reach the pilot of Flight 564 Sept. 15 from Denver to Dulles Airport outside of Washington.

United at first told the Washington Times and other media that there was no Flight 564 that day.

UAL Can't Confirm

Andy Plews, media relations director of the parent UAL, told this newsletter Oct. 1 he does not doubt Hannaford's story but that he has not been able to confirm it. He said PR has been having difficulty in getting a response from the pilots' group.

United has been swamped by phone calls in recent weeks and has had to let go two PR pros because of budget cuts, leaving only four PR pros to service the parent UAL and the airline, he added. UAL and its units have 80,000 employees.

Fleishman-Hillard has been suspended as UAL's nationwide PR counsel because of lack of funds, he said. Also suspended is Schenkein PR of Denver.

Hannaford said he not only has the ticket stubs for the flight but UAL has a computer record of it on its passenger information website.

According to Hannaford, the pilot told passengers not to believe a hijacker who said he had a gun or a bomb.

Instead, he said, passengers should stand up and throw anything they can at the hijackers and any accomplices.

"Get a blanket over him and wrestle him to the floor and keep him there," the pilot further advised, according to Hannaford. The captain further emphasized that the pilot and passengers were in charge of their own fates once they were in the air and not bound by rules, said Hannaford.

Son Escaped from Tower 2 Sept. 11

Hannaford said his son, Richard, was in Tower 2 on Sept. 11 working on the 84th floor for Euro Brokers. He had previously worked for Cantor Fitzgerald on a higher floor but left six months ago. About 700 of Cantor Fitzgerald's 1,000 employees died in the WTC attack.

Hannaford, who was with D&H from 1975-77 and then with The Hannaford Co., said his son and others headed downstairs after the explosions in Tower 1.

"At the 44th floor mezzanine, the public address system announced that the building was secure and advised workers to go back to their offices," said Hannaford.

"My son said he thought over that advice about one-half second and continued down the stairs," said the PR/PA executive.


Matthew Gonring, who joined Baxter International, Deerfield, Ill., as VP, corporate communications 13 months ago from Arthur Andersen, is leaving between now and the end of the year.

He said he resigned his post to seek a new employer "that believes that PR can make a difference." Baxter has about $8 billion in annual sales.

Gonring, who is noted for his expertise in media relations, was VP-CC at USG Corp. from 1993-97 before joining Andersen. He was director of external communications for United Airlines and UAL from 1986-88.

He is a board member of PR Seminar, the Arthur Page Society and the Institute for PR, and is a faculty member at Northwestern University's Medill School of Journalism.


Burson-Marsteller has hired real estate development pro Alisa Feinstein as director in its New York practice to navigate knotty communications issues regarding the rebuilding of the city.

Richard Mintz, chair of B-M's PA practice, called real estate development a "political hot potato" in New York.

Feinstein is to help developers on siting and land-use issues. She has worked for Vornado Realty Trust and served as assistant director of legislative affairs in the New York City Mayor's Office.


Information Week, the fourth largest publication in terms of high-tech ad revenues in 2000 (exceeded only by the Wall Street Journal, Business Week and PC Magazine) disclosed Oct. 2 that its ad pages for August were down 180 pages or 51%.

All nine CMP publications listed in a release via sister company PR Newswire had ad page losses. CMP and PRN are units of United Business Media, London-based company that now derives more than 75% of its revenues from U.S. businesses.

UBM has made an offer to buy Medialink but Medialink has yet to accept it.

Newsday said Oct. 3 that "sources" are saying that CMP could lay off as many as a "couple of hundred" staffers. CMP is located in Manhasset, N.Y.

CMP spokeswoman Alix Raine was quoted as saying there would be cuts but they would not be "significant."

Information Week did not give out the decline in terms of ad revenues.

UBM also disclosed ad page declines in August in the following CMP publications: EE Times, down 143 pages or 32%; Internet Week, down 47 pages or 37%; Dr Dobbs, down 11 pages or 14%; Network Computing, down 43 pages or 28%; Electronic Buyers News, down 131 pages or 45%; Network Magazine, down five pages or 6.8%; CRN, down 94 pages or 32%, and VAR Business, down ten pages or 9%.

Internet Edition, October 10, 2001, Page 8



Washington Post media reporter Howard Kurtz has quoted military sources as saying the war that the U.S. is waging will be "the most information-intensive war that you can imagine."

The source allegedly told Kurtz: "We're going to lie about things...certainly the bad guys will lie."

It's no great shock that the military and civilian governments sometimes lie about things or withhold information in the interests of national security.

A giant whopper told during World War II was that the U.S. needed people to "Buy War Bonds" so that it could afford guns, tanks, etc.

That was nonsense. The real reason for selling bonds was to remove excess money from the economy and avoid inflation. Workers were making good money and consumer goods were in short supply.

Sophisticated citizens know that their governments and other institutions often "fudge the facts." Wise citizens take "official" announcements with a grain of salt. They know that sometimes the officials don't know what they're talking about.

Thus, workers in World Trade Tower 2 who ignored the official advice to "stay in their offices" after Tower 1 was hit saved their lives while those who took the advice perished. One of those ignoring the advice was Richard Hannaford, son of veteran PR/PA pro Peter Hannaford (story on page 7).

Ray Bartels, who worked on the 47th floor of Tower 2, told the New Jersey Record he got a similar message as he headed down the stairs. Linda Lopez, also heading down the stairs, told the Record that one person said, "That's crap," after hearing the "return to your offices" and "stay where you are" messages on the P.A. system.

The point is that good or bad information can mean the difference between life and death.

Speed was another factor. Survivors of Tower 2 complained that nothing came over the P.A. for at least ten minutes after Tower 1 was attacked and when messages finally came, they were false.

Where does PR fit in the current wartime atmosphere? It certainly does feel like wartime in New York since we see Grand Central Station surrounded by police officers and vehicles every day and ditto for the Con Edison power plant on 38th st. and First ave., which we walk by each day.

PR started out in companies at the turn of the century as "truth bureaus" that would give straight answers to the press and public instead of the usual propaganda. The armed forces and government adopted the same model, installing public information officers. But, over the decades, PR moved more and more to the sales side so that marketing PR and IR are what are mainly practiced now. PR people who dispense good and bad news about an employer or client with equal fervor and with speed are a rarity. PR pros are forced to check with multiple superiors and/ or marketing teammates before confirming anything.

Faced with such responses, the media have developed attitudes toward PR that were evident in a Sept. 27 New York Times article headlined, "After Tragedy, Publicists Are Hyper About Hype." It generally mocked the industry and its "happy-face press releases." It called New York's PR industry "the most prodigious conflation of communications representatives and spin managers on the planet." Quoted in behalf of PR were Jack Bergen of the Council of PR Firms, and PR counselors Dan Klores and Howard Rubenstein. Bergen said companies should donate to WTC charities and take out newspaper and magazine ads expressing their sympathies.

PR did not look good on stories about the United Airlines flight where the captain advised passengers to "throw things" at a hijacker (page 7). UAL PR pros at first denied there was any such flight. Then they said they were unable to find out who was piloting the plane. The current wartime conditions, where the public is hyper sensitive to spin and misinformation, present an opportunity for PR pros to go back to their original mission of providing straight stories quickly and working with the media.

We agree this will be the "most information-intensive war" ever (i.e., stories will be spun and "framed" as never before). Americans have to learn all they can about the Mid East and its conflicts. The Internet provides an array of worldwide viewpoints and information sources. We have been accessing, among others, the Jerusalem Post (Jerusalem; South China Morning Post (;;;, and, an "aggregator website," provides access to hundreds of columnists and media in the U.S. and worldwide.
--Jack O'Dwyer


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