HOME DEPOT LOOKS FOR PR DUO

Home Depot plans to hire a firm for corporate PR and a marketing communications agency by mid-March, David Sandor, director of PR, told this NL. He heard pitches from five shops last week. They will augment the work of various regional PR firms used by the Atlanta-based retailer, said Sandor, a founding member of Interpublic's Powell Tate unit.

He declined to name the shops pitching the business.

Jerry Swerling, a Los Angeles-based management consultant handling the search, said the budget for the work is "very substantial." The review began a couple of months ago with nine PR firms.

HD's PR roster has included Edelman PR Worldwide, Fleishman-Hillard, Ketchum, The MWW Group, Schenkein and GCI Group. The company earned $3B on $45B in sales during its latest nine-month period.

COMCAST TIES UP MICROSOFT'S KNOTT

Microsoft's Kerry Knott will become VP-federal affairs at Comcast Corp., the nation's biggest cable company, on April. 1.

At Microsoft, Knott was responsible for broadband, intellectual property rights, immigration and privacy issues. He also managed the software giant's political action committee, and handled outreach to think tanks. Prior to Microsoft, Knott was chief of staff to former House Majority Leader Dick Armey.

Comcast has 21.4 million subscribers following the completion of ATT Broadband acquisition in November. It also has ownership stakes in QVC, E! Entertainment Television, The Golf Channel and Style.

KLORES DEFENDS SPEARS

Britney Spears is relying on New York counselor Dan Klores to shoot down a report in Star magazine that she snorted coke at a Miami nightclub, and asked a friend to check her nose before going back to a VIP lounge. Star bills itself as the magazine with "behind-the scenes" celebrity news and the "dishiest gossip."

"The only one who's guilty of doing cocaine has to be the source of this story," Klores told New York News gossip columnists George Rush and Joanna Molloy. Spears wants a retraction from Star, and is huddling with lawyers.

The magazine stands by its story. Klores, via a spokesperson, said he has nothing to add about the Spears matter when contacted by this NL.

RF GOES TO THE HOMELAND'S DEFENSE

Ruder Finn designed the Dept. of Homeland Security's www.ready.gov website and brochure that provides tips on how to prepare against a biological, radiation or nuclear attack, Scott Schneider, director of the firm's interactive group, told this NL.

"We worked with the Ad Council on its Smokey the Bear campaign," and AC staffers recommended us for the Homeland Security work," said Schneider.

The AC hopes to line up $50 million in space for the "Get Ready Now" ad spots.

Schneider said RF also has worked for the Sloan Foundation, which contributed $1.5 million to fund the campaign. The RF exec had spoken from Cincinnati, where he was attending Homeland Security Secretary Tom Ridge's press conference kicking off the public service drive last week.

Schneider said RF's goal was to compile information for the campaign that was as "clear and accurate"as possible and could be easily understood by all Americans.

Weber Shandwick's Powell Tate also is promoting the ad campaign. Sister Interpublic shop, The Martin Agency, produced the ads.

ZACKS ZAPS IPG's STOCK

Zacks Investment Research has placed Interpublic on its ''stocks to sell now" list because it says the slump in advertising has been a hard pill for the ad/PR conglomerate to swallow.

Zacks.com notes that IPG's earnings estimates for this year and next have been lowered during the past three months, and that its shares traded at a 10-year low earlier this month.

"These have been tough times for the world's second-largest advertising group, but it should see much better days in a more cooperative environment," says Zacks.

Alcoa joins IPG on the "stocks to sell list." Since 1980, members of the list have underperformed the SP 500 index by 89.8 percent, says Zacks.

Bankruptcy Scenario Explored

Interpublic would only fetch about ten cents on the dollar of its long-term assets if it were to go bankrupt, says Deutsche Bank Securities. Goodwill of $3.3B (74% of assets) would be worth "zero."

But it says banks remain "optimistic" about IPG (assuming it sells NFO for $500M+).

(Continued on page 7)

PT PUSHES FOR AIRLINE LABOR RELIEF

Powell Tate has been retained by an airline industry-backed group to help end lengthy labor negotiations by establishing legislation in a national push to reform existing legislation in favor of arbitration hearings.

Communities for Economic Strength Through Aviation was assembled last year with primary backing from the Air Transport Association, the beleaguered industry's main trade group.

CESTA is in the midst of a national media blitz calling for the reform of The Railway Labor Act of 1926, which originally set up railroad workers' right to unionize and has come to apply to the airline industry. That law paves the way for cooling-off periods and what the group says is a drawn-out process that favors labor and costs the airlines millions.

CESTA, which bills itself as "broad-based and non-partisan" group, says it is calling on Congress to modernize that act and find a way to resolve contract disputes "fairly quickly and amicably," without slowdowns or strikes. It has not formally backed any legislation but advocates an arbitration system similar to one proposed by Sen. John McCain (R-Ariz.) last year.

The group has tapped former New York Congresswoman and former head of Ketchum's Washington Group unit Susan Molinari to head the effort. Vin Weber and Vic Fazio, managing partners at Omnicom'sClark & Weinstock, are also involved in the effort.

The AFL-CIO and the Air Line Pilots Assn. have blasted CESTA's efforts.

ALPA has released a policy statement stating: "Led by American, FedEx and Delta, the industry has mounted a campaign to enact legislation that would impose 'baseball style' arbitration in airline negotiations, thereby replacing a delicately balanced labor law system with one that tilts heavily in management's favor."

FOGELMAN-BEYER EXITS H&K

Alisa Fogelman-Beyer has stepped down as head of Hill & Knowlton's Washington, D.C., office after a 10-month stint.

At 36, she was the youngest executive to lead the D.C. office, when she succeeded acting head Tom Hoog last April.

Fogelman-Beyer had sold her ProMarc Agency to H&K the previous April. She was named head of H&K's corporate and technology group. Fogelman-Beyer is packing it in at H&K so she can spend more time with her family.

That family theme ran through a glowing feature of another former H&K D.C. head, Torie Clarke, in a New York Post piece earlier this month.

Clarke is now Defense Secretary Donald Rumsfeld's spokesperson. The 43-year-old "striking six-foot blonde" juggles her job with being a mom of three," wrote Deborah Orin.

Another Clark (Paul) has been named acting manager of H&K/D.C.

TERRORISTS, GOV'T USE MEDIA

The 24/7 media are allowing terrorists achieve their goals, Hafez Al Mirazi, bureau chief of the Al-Jazeera satellite TV network, told the National Press Club on Feb. 12. The media spotlight also helps governments attain their goals, he added. "The [U.S.] Government is not giving or volunteering information from the Pentagon just for the sake of it," he said. The purpose is to intimidate Iraq, said the journalist at the PRSA International Committee event.

Al Mirazi noted how terrorists tap into whatever is perceived as breaking news and then play on it. "If CNN or Fox or others are not going to have breaking news flashing on their screens if Palestinians are killed, but only if Israelis are killed, then they [terrorists] will go out and kill an Israeli," said Al Mirazi.

Al Mirazi said his network is careful not to be exploited by its coverage of terrorists like Osama bin Laden. He noted how Al-Jazeera edited out four minutes of a bin Laden tape aired last November because it had instructions to his followers to target specific U.S. installations. "This had no place in what we put out," said Al Mirazi.

Jerrold Post, director of the Political Psychology Program at George Washington University, stressed the symbiotic relationship between terrorism and the media. "If a terrorist act occurs, and it isn't reported, is it a terrorist act?" asked Post.

Al Mirazi agreed with Post saying, "You are not terrorizing the dead, you are terrorizing those who are living and witnessing what's going on."
Post feels Osama bin Laden is a master of the media. He attributes bin Laden's most recent tape release as a ploy to take some of the focus from Saddam.

"The main thrust of the recent tape is to show that he [bin Laden] is the baddest," said Post.

QORVIS GIVES GALLAGHER GROUP A RAISE

The Gallagher Group has inked a $300K one-year pact to provide Qorvis Communications public policy advice, assistance in writing briefing papers and conduct meetings with Congressional and White House staff members on behalf of Saudi Arabia.
Jamie Gallagher's firm was getting $10K a month under a previous six-month agreement inked with Michael Petruzzello's firm.

QC's $2.4M one-year pact with the Kingdom was signed on Nov. 14, `01. A new pact is being finalized, said a Qorvis staffer.

Gallagher, 39, is a former senior policy analyst for the Republican Study Group in the House. He served as director of Congressional Affairs at the Defense Base Closure and Realignment Commission (`91-93) and as legislative director for Sen. Judd Gregg. Gallagher set up his firm in Jan. 2000, leaving a VP post at Boland & Madigan. Petruzzello was CEO of Shandwick International.

Both executives testified in December before Rep. Dan Burton's Committee on Government Reform panel probing reports of Saudi men kidnapping their children to the Kingdom.

PAT SAJAK'S BOOKER SEEKS GUESTS

Fox News Channel has signed Pat Sajak, the "Wheel of Fortune" host, to lead a "celebrity- and newsmaker-driven talk show" on Sundays, starting in the spring.

The new program, dubbed "Pat Sajak Weekend," will air at 9 p.m. on both coasts.

Scott Gorenstein, who is the talent booker, wants publicists to make their clients available for interviews on the program.

"The format is one hour with one or two guests per show in a one-on-one format providing your talent with a venue for quality conversation," said Gorenstein, who is based in New York at 1211 Avenue of the Americas, 17th floor.

He said taping will be conducted out of the Fox studios in New York, Los Angeles and Washington, D.C., "giving us an opportunity to catch up with our guests wherever they may be."

Ground transportation can be provided as well as hair and make-up, said Gorenstein, who also asked publicists to update their mailing lists so he is "aware of your client's activities."

He can be reached by phone at 212/301-5339; fax: 301-5250.

MOTOR TREND SHIFTS TO LIVE BROADCASTS

Motor Trend Radio has a new host, Bob Long, and a new call-in audience participation format for the weekend automotive program.

The show, which airs two hours on Saturdays and on Sundays on most affiliates, is currently airing on 95 stations, with an estimated cumulative audience of 750,000 each week.

Long is a veteran of more than 20 years in the radio business, and also served as national spokesperson for the Sears Diehard Security Battery from 2000-02.

The program offers live interviews with Motor Trend magazine's editors, automotive personalities, and car company representatives.

TECH WRITERS TO CO-PRODUCE CONFERENCE

Walt Mossberg and Kara Swisher, who are technology columnists for The Wall Street Journal, are co-producing an executive conference on the impact of digital technology, hosted by the newspaper.

The event, which is called "D: All Things Digital," will take place at the Four Seasons Aviara Resort, in Carlsbad, Calif., on May 27-29. Early bird tickets are selling for $2,495, rising to $2,995 after March 28. Attendance will be limited to about 300.

The two columnists will conduct a day-long series of "unscripted Wall Street Journal-style interviews" with technology and Internet leaders, including Bill Gates, Microsoft; Steve Jobs, Apple; Steve Case, AOL/Time Warner; Barry Diller, USA Interactive and Vivendi Universal Entertainment; Meg Whitman, eBay, and Terry Semel, Yahoo!

They also will present a technology demonstration, featuring first looks at a handful of cutting edge digital products and services.

"We're presenting the best people, leaders with real information to impart, not a stock to tout," said Swisher, who writes the Journal's "Boom Town" column.

The Journal is currently looking to sign up corporate sponsors for the meeting. Initial sponsors are Adobe, Kyocera and Hewlett-Packard. Gabrielle Shamsey is handling sponsorship inquiries at 212/ 597-6126.

Details about the conference are available at phone: 866/416-DWSJ.

PLACEMENT TIPS

The St. Louis Post-Dispatch is starting a new "quirky, gossipy personality-driven" column in April, according to Kathy Best, assistant managing editor for metro news.

Deborah Peterson, 49, a P-D reporter with 25 years' experience, will author the column, which will appear on Tuesdays, Thursdays and Fridays each week on page 2 of the "Metro" section.

Peterson's column will focus on local people, society, entertainment, and gossip.

Urban Dialect will make its debut as a new alternative monthly magazine in Cleveland on March 3.

Daniel Kontar, who wrote for the now-defunct Cleveland Free Times, is editor and publisher.

The FT was closed down three months ago by its New York-based parent company, Village Voice Media, after a deal was made with the Phoenix-based New Times to discontinue operations in Cleveland if NT closed its Los Angeles paper.

Aviator's Guide is a new bimonthly magazine for private pilots. It will target the luxury lifestyle market, which includes those who take an average of 35 to 40 general aviation trips per year, lasting more than five days.

Sean Fulton, editor of the magazine, said it will focus on products and services that make general aviation travel enjoyable. Target circulation will be 100,000 paid and qualified readers.

Fulton can be reached at the magazine's editorial offices located at 14 Vanderventer ave., Port Washington, NY 11050. 516/767-3325 ext. 203.

Caroline Wilbert was recently assigned to cover the local media beat at The Atlanta Journal-Constitution.

Besides her reports for the newspaper, she also handles the daily "CNN Insider" on J-C's website.

Wilbert had been covering technology companies, the hospitality industry and the Georgia economy.

She can be reached at 404/526-5332.

Tom Scowden has joined CNN's "Larry King Live" as senior producer.

(Media news continued on next page)

AJC REFUSES TO CUT COVERAGE OF DISPUTE

Mike King, who is the ombudsman for The Atlanta Journal-Constitution, said the paper will continue its "aggressive coverage" of the Augusta National Golf Club's refusal to admit women members.

"As long as the protests are planned, as long as the issue continues to show up in other arenas-on Capitol Hill or in the business community, or in the talk among players on the PGA tour this spring- we'll cover it," said King.

King was responding to an op-ed piece by Jim McCarthy, a media consultant to ANGC, who accused the paper of overkill and for using its news columns to conduct a campaign to get the club to change its rules (NL, 2/19/3).

"It is a frequent question-when does reporting on a controversial issue cease to be real news and cross the line into creating news or becoming advocacy? Not surprisingly, the question almost always comes from those at the center of the controversy." said King.

"We should never let public opinion be the sole barometer for deciding what is news and what isn't," said King, who believes the story is far from over.

TIGHT-LIPPED CEO 'DODGES THE PRESS'

Bill Wrigley Jr., who is CEO of Wm. Wrigley Jr. Co., won't talk to Fortune.

Staff writer Julia Boorstin said the 39-year-old CEO has rejected interview requests because, "as his PR rep insists, he's too busy tending his three young children and running the chewing-gum enterprise his great-grandfather founded."

One thing is clear, he "isn't dodging the press because he's floundering in his job," said Boorstin, who points out the company's stock has risen 18% since his ascent to CEO in March, 1999.

SHIFT WILL CEASE PUBLICATION

Shift, a ten-year-old Canadian magazine, is suspending publication after the March 2003 issue. It had targeted the twentysomething demographic with coverage of technology, youth culture and politics.

Multi-Vision Publishing, which acquired the magazine out of bankruptcy two years ago, cited "uncertainty" in the economy, especially the technology ad sector, as the reason for the shut down.

Neil Morton, editor-in-chief, said his staff was shocked by the announcement.

HOLLYWOOD IS COMMUNICATIONS CAPITAL

Hollywood has replaced New York as the "communications capital of the world," according to Gail Becker, EVP/general manager of the Los Angeles office of Edelman PR Worldwide.

"We live in a world where even Washington and London are taking their policy cues from what they saw on `The West Wing' last night," said Becker.

"Even one of our very own Washington policy influentials, Mike Deaver, has just signed a deal for a major new series with HBO," she said.

Deaver is Edelman's vice chairman-international and former Reagan White House deputy chief of staff.

PUBLICITY CASE GOES ON TRIAL IN LONDON

Lawyers for Hello!, a London-based celebrity magazine which was sued by actors Catherine Zeta-Jones and Michael Douglas for publishing pictures of their wedding, say the couple forfeited any right to privacy by actively seeking publicity for the event.

"The deliberate seeking of publicity destroys confidentiality in respect of personal information for which publicity is sought," the attorneys for Hello! argued in defense papers released at the trial in London's High Court.

The couple is suing Hello! for printing unauthorized photos three days before rival magazine OK! was able to publish photos from the same event- and which it had paid $1.6 million for the exclusive rights to.

The fact that OK! also had permission to run the photos in syndication in another 20 magazines supports their argument, the defense said.

The actors had signed an exclusive $1.65 million deal with OK! to take the official wedding photos.

USN&WR TO SEGREGATE COVERAGE OF WAR

U.S. News & World Report will divide the magazine into two parts if the U.S. goes to war with Iraq to give advertisers an option to be with non-war news.

Bill Holiber, publisher, told Media Industry Newsletter that the front-of-the-book will be allocated to coverage of the war. Then inside, USN&WR will print a second cover and a second table of contents to showcase and separate the "News You Can Use" and other non-war features.

AUTHOR SEEKS IDEAS FOR BOOK

Author Jennifer Caton is seeking ideas and advice from executives and celebrities on activities they do with their children that their children love to do.

Caton will give recognition to submitters of ideas used in the book, which will be targeted at busy parents to help give them proven ideas on activities they can do with their children to promote quality time.

She would like to get the information via e-mail at [email protected] or by phone at 205/790-2358.

PEOPLE

Leesa Dillon-Faust has stepped down as news director of WOIO-TV and WUAB-TV in Cleveland to take a job at the Fox affiliate in Las Vegas.

Paul Friedman, 57, managing editor for news coverage at ABC-TV, in New York, is giving up the job to become a part-time consultant to the network.

The option exercise by Omnicom's CEO John Wren (page 7) has resulted in some grousing by OMC investors on the Yahoo! bulletin board.

They say it looks bad for him to be costing OMC $1.2 million when so many investors have suffered in OMC's slide from $107 to the $50's and the company is on credit watch.

There was an argument on Yahoo! over whether the option exercise (referred to as a "money grab") cost OMC any money.

Some investors thought that OMC could just take some house stock bought at an earlier time and fill the order that way, thus costing OMC nothing.

Figuring the cost of options has been a hot topic in the media in recent months. But that only refers to placing a value on options at the time that they're given. Once they're exercised, there's no mystery about the cost to the company.

OMC, presented with the options by Wren, either had to buy the shares in the open market at $61.26 so that Wren could exercise his options at $10, or add 23,800 shares to the total outstanding. Either way the cost was the same to OMC.

The bad PR of this situation is that on June 13, 2002, one day after the Wall Street Journal exposé that dropped OMC from the $80's to the $60's, Wren, in a grandstanding PR move to show confidence in the firm, purchased 20,000 shares at the full price of $55.10. These were bought in the "non open market," from whom we don't know. It could have been another OMC executive.

Why didn't he exercise his $10 options at that point? Because it would have looked bad. But six months later he's back in the market when nobody's particularly paying attention exercising the $10 options and costing OMC $1.2M. The average cost of his 43,800 additional shares (he previously owned 208,712 outright) is around $30. OMC executives hold options on 1.8 million other OMC shares at prices of $24 and lower. If all were exercised it would cost OMC $70M+. No comment could be obtained from Wren or Patricia Sloan, PR aide.

Many New Yorkers complained they were blocked from the Feb. 15 rally against the invasion of Iraq that was held on the East Side.

Police estimated the crowd at 100,000 but organizers said it was closer to 500,000 and that many thousands were barred from reaching the rally by police barricades.

The city had denied the protesters a marching permit.

One theory is that GOP Mayor Bloomberg wanted to keep the total of participants as low as possible.

Howard Hudson, founder of the Newsletter Assn. of America (now the NL & Electronic Publishers Assn.), will be 90 on Feb. 27.

Also the founder in 1955 of PR Quarterly and Hudson's Washington News Media Contacts, he still works at home in his office in Rhinebeck, N.Y. He "does not feel 90" nor pay any attention to his age. "Those are only numbers," he says. He still belongs to PRSA , becoming a fellow this year. Hudson once headed Ruder Finn's D.C. office.

We have spoken to three groups of PR students in recent weeks-at Columbia University, Florida International Univ. in Ft. Lauderdale, and to students of Southern Methodist University who visited our offices.

Our message was that students should be prepared to start their own businesses because of the high healthcare and other costs that employers are facing (running close to 30% of salary and including $12,000+ HMO costs for married workers).

"Brand" yourself by taking courses and engaging in activities that give a clear indication of interests such as financial, beauty/fashion, travel, healthcare, sports, food, etc., we advised.

We also advised joining local business, social, charitable, political and religious groups, perhaps as publicity chairs, as a means of broadening contacts, particularly with CEOs and their spouses.

About 90% of the students were women.

Women are starting 80% of new firms, says Grow Yourself Rich, quoting the Dept. of Commerce. Author Jay North ([email protected]) says women often don't realize they have to spend one-half of their time promoting their firms. North, a 30-year PR/marketing veteran, advises plenty of PR and salesmanship.

Students should consider bartering their services for restaurant meals, food, clothing, etc.

Omnicom owns a controlling interest in one of the biggest barter firms, ICON Int'l of Stamford, Conn.

The firm's website (icon-intl.com) says it "helped legitimize the corporate barter industry." ICON says it pays more for excess inventory than companies can get from liquidators or closeout dealers. Interpublic says it has no investments in barter firms.

Investor Warren Buffett may have bailed out of Omnicom. A September 2002 SEC filing showed he owned 500,000 shares but the Feb. 14, 2003 filing does not list any OMC stock.

Reuters said the SEC lets Buffett withhold info on some trades because of the impact his decisions might have.

Google built itself into a $2 billion business by having a great product and via publicity including word-of-mouth, says a piece in forbes.com by Penelope Patsuris. "Not a dime was spent on ads" she writes.

Shocker of the week was the half-billion+ loss at Reuters and its plans to drop another 3,000 employees, cutting staff to 13,000 by 2005 (it was once 19,000).

Info available free on the web and Bloomberg terminals are giving Reuters a big headache.

N.Y. Post said Bloomberg reporters are complaining about ten-hour workdays and "other pressures."
--Jack O'Dwyer