Contact O'Dwyer's: 271 Madison Ave., #600, New York, NY 10016; Tel: 212/679-2471; Fax: 212/683-2750
ODWYERPR.COM > Jack O'Dwyer's Newsletter return to main page


Jack O'Dwyer's NL logo
Internet Edition, March 10, 2004, Page 1

Sony Electronics has named Ruder Finn for its line of VAIO notebook/desktop computers, CLIE handhelds, Cyber-shot digital cameras and Handycam camcorders.

Jessica Switzer, managing director of Ruder Finn/San Francisco, and Kristin Greene, VP, are responsible for the account. They will be supported by consumer technology staffers in RF's New York and Los Angeles offices.

Gretchen Griswold, PR director of Sony's PC, display, handheld, digital imaging products, personal audio and mobile electronics offerings, cited RF's media relations strengths and "team chemistry" among reasons for its selection.


Edelman has won the Almond Board of California's $1 million food service and industrial sector PR account after a three-month review that included 15 firms. Ketchum was the incumbent.

Work begins in August based in the firm's San Francisco office. Nicole Didda, general manager of Edelman/San Francisco, told this NL the office will be assisted by Edelman/Sacramento and its Chicago food practice.

She noted Edelman's work is focused on the "B2B" segment of the board's marketing, targeting industry professionals like food technicians, nutritionists and chefs.

Porter Novelli handles consumer PR, the second half of the Almond Board's PR. That segment was not up for review, but PN adds duties for Western Europe after a three-month review of nine firms.

Burson-Marsteller is slated to head a proposed $15.3 million PR and advertising campaign aimed at educating Ohio voters about new voting machines on the horizon.

The effort, proposed by Secy. of State Ken Blackwell, would be a state-wide, 18-month push.
Ohio wants to have new electronic voting machines in place by November 2005 to comply with a new federal law requiring punch-card and lever-action machines to be phased out by the states.

Among the logistics of the plan are media tours, advertising and other efforts like direct mail, paycheck inserts and an "embedded" media program.

The U.S. Treasury Dept. has selected Weber Shandwick for a campaign to encourage people to use direct deposit for their benefit payments.

Alvina McHale, spokesperson for the Treasury, told O'Dwyer's a budget won't be determined until WS huddles with Wirthlin Worldwide in mid-March. She said the Treasury Dept. hired WW about a year ago to explore the emotional aspects that people attach to receiving a paper check from the federal government.

Officials of the Federal Reserve and Social Security Admin. also were involved in the selection process.

The Treasury Dept.'s Financial Management Service unit distributes $1.7 trillion a year to 100 million Americans. Nearly eighty percent of recipients opt for direct deposit, and it is WS' job to convert the rest. McHale says an electronic deposit is 62 cents cheaper than preparing and mailing a check.

Edelman PR Worldwide, the largest independent PR firm by a wide margin, held steady at $206 million in fees in 2003. Its 2002 fees were $205.7M.

Ruder Finn, second largest at $79.1M, gained 7.3%.
It spun off RFBinder Partners, which reported $7.8M in fees, up 7.8%.

About an equal number of firms in the top 50 reported either double-digit gains or double-digit decreases as business conditions continued to be difficult for the PR counseling industry. (Table on page 7.)

Among the big gainers were Waggener Edstrom, up 17.7% to $69.7M; Padilla Speer Beardsley, up 16% to $9.5M; Dittus Comms., up 26% to $8M; PainePR, up 13% to $7.9M; Cooney/Waters, up 16.8% to $7.8M; Peppercom, up 24% to $7M; M Booth, up 10.9% to $6.4M; Sloane & Co., up 10.9% to $6.3M, and Spectrum Science, up 34% to $6.4M.

New to the list is Qorvis, Washington, D.C., with $12.2M in fees, whose clients include Saudi Arabia.

Nearly 110 independent PR operations provided proofs of the fees and employees in the form of top pages of income tax returns, W-3 forms showing total payroll, account lists and other documents.

Council to Publish Rankings in `Categories'

The Council of PR Firms, meanwhile, which gave up its annual ranking of PR firms after the publicly held ad/PR conglomerates ordered their PR units not to release any figures, said it will publish a ranking of firms by broad categories of fee incomes.

There will be seven categories: $100 million+; $50-$99M; $25-$49.9M; $10-$24.9M; $4-$9.9M; $1M-$3.9M, and below $999,999.

Firms will be allowed to include up to 10% of their fees in commissions from corporate and issue ads. The entire income is counted if a firm owns more than 50% of another firm. Revenues of acquired firms are included as of the date of the acquisition.

The conglomerates had cited the Sarbanes-Oxley Act as the reason for preventing their PR units from releasing figures. Under SOX, all released figures have to be in conformity with GAAP (generally accepted accounting principles). Such principles vary from country to country.

Lou Capozzi, chairman of the Council, said that "Ironically, the Act that was made to encourage openness and disclosure, has resulted in less disclosure."

Companies that disclose false figures face fines and their executives face jail terms.

Many Firms Down

Among the firms with double-digit declines were Schwartz Comms., off 17.7% to $16M; Hoffman Agency, off 30.9% to $8.2M; KCSA PR, off 17% to $6.3M; Vollmer PR, off 9.6% to $5.7M; PAN Comms., off 14% to $5M, and Morgan&Myers, off 15% to $4.9M.

Rankings of ad agency-related PR operations not owned by the ad agency conglomerates will be published next week.

Internet Edition, March 10, 2004, Page 2


The University of Colorado, embroiled in a widely covered sexual assault and athletic recruiting scandal, has hired Denver-based GBSM for PR support.

The school's high-profile football team is under the gun for charges of rape and using sex and alcohol to lure recruits to the program.

The university's board of regents March 4 approved a $450K emergency funding proposal that included $100K for GBSM's PR support.

A spokeswoman for the school told this NL media inquiries have deluged PR staffers at the University's four campuses, which have "banded together" as a single unit for the crisis. She said GBSM is serving an advisory role through the president's office and is not handling direct calls from reporters. She noted that the school was the subject of 135 individual print news stories on a single day in late February.

The school, which is under investigation by local officials, the state attorney general (at the behest of Gov. Bill Owens) and the university's own board, has hired John DiBiaggio, former president of Tufts, Michigan and Connecticut universities who has been involved in efforts to probe problems in college athletics, as a liaison. Congress has scheduled hearings for March 11 on college recruiting tactics.

GBSM was founded by John Baron, former press secretary to Sen. Paul Sarbanes (D-Md.).

PR21 says it "suspended" its London office, and will re-enter the European PR arena when the market rebounds.

Jerry Epstein, CEO of the Edelman spin-off, said the London operation, which it acquired from Rowland in `00, had "diminished to the point where there is no other option" but to shut it down. PR21 has decided that its growth is centered in the U.S.
The firm's London fee income dropped 51 percent to $2.1M last year. That is in sharp contrast to the 11.4 percent hike in the U.S.

PR21/San Francisco, which is headed by former Hill & Knowlton, Fleishman-Hillard and FitzGerald Comms. veteran John Berard, posted the biggest gain in the U.S., up 24.6 percent to $2.6M. New York was down 9.3 percent to $5.3M.

PR21's overall fees dipped 5.9 percent to $14.7M.


Kekst & Co. is handling media for Kohlberg Kravis Roberts & Co., the equity giant with plans to acquire bedding leader Sealy in a $1.5 billion deal.

New York-based KKR and Sealy management would acquire 92 percent of Sealy in the deal announced last week. Bain Capital bought Sealy in 1997 for $830 million.

Kekst partners Ruth Pachman and David Lilly are handling press inquiries for KKR regarding the acquisition, which Sealy shareholders have approved.

Mullen handles PR for the company.


The Coalition for Economic Growth and American Jobs, a newly formed Big Business-backed entity, is fighting anti-outsourcing legislation, and may hire a national PR firm to get its message across that globalization is a benefit to this country's future.

At least 80 bills have been introduced in 30 states to try to stem the halt of manufacturing and white collar jobs being sent overseas.

The Wall Street Journal broke the news last week about creation of the anti-outsourcing bill coalition. It identified the U.S. Chamber of Commerce, Business Roundtable, National Assn. of Manufacturers, American Bankers Assn. and the Information Technology Assn. of America as key backers of the Coalition.

Harris Miller, president of the ITAA, says the Coalition needs aggressive PR because outsourcing has become such a hot political issue.

Hill & Knowlton has been active on the outsourcing front as representative of India's software sector.

Porter Novelli has brought in technology editor Andrew MacLellan in Boston to head its work for semiconductor giant Analog Devices.

MacLellan, a Silicon Valley and Boston technology media veteran, was editor-in-chief of CMP-Media's Electronic Buyer's News and earlier was at Electronic News. He heads up PN's Advanced Technology Division for the East Coast in addition to the Analog work.

Omnicom's PN has handled PR for Norwood, Mass.-based AD for three years.


The Avenue Group has hired Rubenstein Assocs. to boost the profile of the Sherman Oaks, Calif.-based company that has oil and gas interests in Turkey. John Henderson, who reps Avenue from the 50-year-old firm's New York headquarters, would only say he is helping with "general PR."

Avenue, on Jan. 29, hired PMR and Assocs. (Del Mar, Calif.) for PR and business development. It issued a release praising PMR head Patrick Rost's "strong track record of representation of NASDAQ and OTC Bulletin Board clients." The release quoted Avenue CEO Levi Mochkin calling PMR a "suitable partner" that will provide Avenue the services it is "seeking to take Avenue to the next level and beyond."

Rost said he would not comment about Rubenstein's hire. Mochkin told O'Dwyer's he hired Rubenstein because it can achieve PR results that others can't.

Sandra Saias, who was deputy general manager/ creative director at Edelman PR Worldwide's consumer marketing group, is now executive VP at Ogilvy PR Worldwide. She is in charge of the Chicago consumer marketing practice.

At Edelman, Saias co-led its tourism and lifestyle group, counseling Mutual of Omaha, Microsoft, Expedia, Cranium and Unilever's Dove and Axe brands.

Internet Edition, March 10, 2004, Page 3


Michael Getler, public editor at The Washington Post, said a "good chunk" of the e-mail he gets every day comes from members of special interest groups that are publicizing an issue and advocating a canned e-mail response.

Mark Glaser, who writes for the Online Journalism Review, said Getler sometimes gets 1,000+ e-mails on a hot topic.

Getler said many special interest groups have " media watch groups," who are paid to read and look for things in newspapers and then send advisories to all members of the special interest groups saying, "Such and such a paper has said this in this fashion and you should write to the editor or ombudsman."

"It does not mean the points are not valid," said Getler. "It just means it has enormously expanded the amount of mail you get."

He believes these e-mail letters have less impact than people who write as individuals, and who come to these observations and complaints on their own.
"Many of the e-mails are not really relevant to anything you're doing," said Getler.

Okrent Uses Help

Daniel Okrent, the first public editor at The New York Times, has an assistant, Arthur Bovino, to help manage the heavy load of correspondence.
Each e-mail message a reader sends to Okrent at [email protected] gets an auto-reply assuring the sender their message will be read.

While e-mail makes it easier for people to let their views be known, it "multiples the volume beyond anyone's possible comprehension," said Okrent, who also still prefers to get letters written on a piece of paper and delivered by the postman because "it takes more thought and care."

Jeffrey Dvorkin, who is the ombudsman for National Public Radio, said "the flow of e-mail is now so intense that it limits the ability to respond in a thoughtful way to every e-mail."

Dvorkin told Glaser he reads all of his e-mails. "When political or cultural blogs tell their adherents to e-mail the ombudsman, the first 50 or 60 e-mails are impressive. The repetitious nature of the e-mails tends to be counterproductive after a while," he said.


Kemp Powers, who was recently sent to Los Angeles to write stories for Fortune Small Business (FSB), is looking for "fresh story ideas, especially about entrepreneurs in the West," said Dan Goodgame, who is managing editor of FSB.

Powers, who will travel throughout the West and beyond to get a story, will cover "all aspects of the entrepreneurial experience: successful startups, instructive screwups, philantropists, scammers—you name it," said Goodgame, who is based in New York.

The 30-year-old Powers, who had previously been a writer at Forbes, likes to write about family businesses. "They were usually stories no one else had done, and you didn't have to go through PR people. You deal directly with the owners, who were usually very open and friendly, and you could weave a human narrative," said Powers.

He collaborated with Brandon Copple, a new FSB contributor, to write the lead story in the March issue about a family-owned Colorado firm that has won consumer trust for its all-natural beef and is seeing brisk demand amid the mad cow scare, said Goodgame.

Powers is at [email protected].

PLACEMENT TIPS debuts this month as the insider's guide to Los Angeles on where to go, what to do, and what's new.

Editor-in-chief Laurie Pike will lead's editorial team that will report daily on what's new and noteworthy in L.A., filtering news, reviews and content, as well as sharing the latest scoop and gossip.

Pike, who has helmed several consumer publications, including Glue and The Los Angeles Times' magazine Distinction, said the website's editorial mission is to "capture the city in real-time for an audience that demands more than the standard fare." will debut with 30+ themed guides, which include information on shopping, dining and nightlife, as well as tips such as what to order, how to get into an industry-only sample sale and where to find secret parking spots.

The service was developed by MediaNews Group's California Newspapers Partnership, which also includes Gannett and Stephens Media Group.

Business Week, which is celebrating its 75th anniversary, will start a new weekly column called "The Great Innovators."

The one-page features will showcase innovators, past and present, who have made their mark in business, including science, technology, management, marketing, finance and government.

Cargo, a shopping magazine for men, made its national debut March 9.

The magazine, which will publish six times in 2004, will be targeted at 25 to 45-year-old males, with money to buy expensive things.

The editorial content in the 210-page debut issue, which features a section on digital video cameras, skews about 50% fashion and grooming.

Ariel Foxman, 30, is editor of the Conde Nast magazine.

Chow magazine is planning a launch in November as a rival to Martha Stewart's Everyday Food.

Jane Goldman, a former editor of the now-defunct Industry Standard, is starting the magazine, which will offer how-to cooking tips and recipes, and information about food.

Tribeza magazine in Austin, Tex., celebrated its third birthday on March 6 with an issue of more than 100 pages and nearly 100 advertisers.

The magazine was started by Zarhun Dean, 32, who was born in Afghanistan and immigrated to the U.S. when he was 8 years old after his father, a pilot of the Afghani airline, fled the country during the Russian occupation.

The magazine covers everything from art, architechture, beauty, community, cuisine, entertainment, and fashion.

Dean, who is editor, is in the process of hiring a managing editor, according to Michelle DeCrane, VP/marketing.

Dean can be pitched at 512/474-4711.

Bob Schieffer, who hosts "Face the Nation" every Sunday on CBS, said a good interview is when the person being interviewed "makes some news, when he says something that he hasn't said before."

Equally important, is when that person gives a good explanation of what it is he stands for or what it is he has taken a certain position, Schieffer told the Poynter Institute.

His favorite follow-up questions are: "What do you mean by that?" and "Well, give me some examples."

Discovery Home & Leiusre Channel in Silver Spring, Md., will undergo a transformation when it debuts as Discovery Home Channel on March 29.
Programming categories on DHC will include decorating, landscaping, entertaining, home improvement and how-to subjects of particular appeal to women.

David Karp, SVP/general manager, oversees the programming.

Media Industry Newsletter is starting a new monthly report on advertising on March 15.
Ann Cooper, former creative editor at Adweek and founder of Ad Age's Creativity Magazine, was named editor of the Advertising Report, published by Potomac, Md.-based PBI Media.

The Ad Report will consist of ad statistics, interviews with the leading ad agency executives, media planners and corporate marketers and will cover the brands and people on the radar and under the radar.

Cooper can be reached by e-mail at [email protected], or at 212/621-4833.

(Media news continued on next page)

Internet Edition, March 10, 2004, Page 4


Keith Bradsher, former Detroit bureau chief of The New York Times, who now heads the paper's Hong Kong bureau, is not surprised by the number of reporters who are hired as auto publicists.

Bradsher, who wrote a book about SUVs called "High and Mighty," said it is hard for news organizations to hold on to people against the considerably larger salaries, and much better benefits that the auto industry offers.

He said The Associated Press has lost five out of its last seven auto writers to working for the PR arms of the automakers.

"The strange result is that you go to a press conference one week, and you're standing next to somebody who's asking questions, and the next week they're standing next to the executive receiving the questions," he said in an interview with the host of "On the Media," which airs on NPR stations.

Since many publications are dependent on automobile ads, it does have "a chilling effect on coverage," but it varies by the news organization, he said.

The auto industry definitely places ads in media outlets that they perceive as providing a friendly or conducive environment for their products, he said.


Adam Penenberg, the author of "Tragic Indifference: One Man's Battle with the Auto Industry Over the Dangers of SUVs," claims an article about him was pulled by an editor at Fast Company out of fear of alienating auto advertisers.

John Byrne, editor-in-chief of FC, said Penenberg's charge was untrue, and accused him of trying to get publicity for his new book, which recalls when Ford Explorers equipped with Firestone tires were involved in a growing number of fatal rollover accidents.

WDSI, a Fox TV station in Chattanooga, Tenn., is shutting down its news department. The station will continue to televise local news during its 10 p.m. time slot, but it will originate from WTVC, the local ABC affiliate.

Rupert Murdoch is consolidating operations of his two New York-area TV stations, with plans to move most operations of WWOR (Ch. 9) from Secaucus, N.J., to the Fox Channel 5's studios on East 67th street in Manhattan.

American Style, a magazine for craft enthusiasts and collectors, is going bimonthly after 10 years as a quarterly.

The April 2004 edition, the first in the new publication cycle, went on newsstands Feb. 24.
Hope Daniels, who is editor-in-chief, said the magazine will undergo a number of editorial changes over the coming year, including an expanded "Arts Travel" department.

The magazine, which has a circulation of 60,000, was started by The Rosen Group, a Baltimore-based company, in 1995.

Pearson, which owns The Financial Times, said the "outlook for our business newspapers remains uncertain" due to the decline in advertising.
The London-based publisher said ad revenues at the FT, which had an operating loss in 2003, fell by 4% in the first two months of the year.

Internet Edition, March 10, 2004, Page 7


Internet Edition, March 10, 2004 Page 8



Corporate board members "turn into meek conformists, valuing unity over truth," writes James Surowiecki in the March 8 New Yorker.

His probe of the pathology of boardrooms echoes boardroom expert Nell Minow's remark last year that board members lose "half their I.Q.'s " and all of their "courage."

Surowiecki is trying to find out why the boards of Worldcom, Enron, Tyco, etc., did nothing to halt the abuses that rocked those companies and cost investors hundreds of millions of dollars. Nearly every board vote at Enron was unanimous, he notes.

For openers, he says that boards are often kept in the dark about important matters (e.g., year-end bonuses to Tyco executives given months before the end of the year).

But the worst force in operation is the crushing conformity. Dissent is seen as harmful. Surowiecki says people in small groups fall prey to "group think...they become increasingly sure their collective judgment is infallible. They listen mainly to each other and they emphasize the need for consensus... living in a kind of echo chamber of their own opinions."

Surowiecki wants "independent directors" who have access to "a reasonable amount of information."

Exhibit A of a conforming, insular board is that of PR Society of America. It ignores the wisdom of Sarbanes-Oxley, which orders public companies to appoint outsiders to the board (a policy that many non-profits are also following).

Perhaps the high point (or low point) in board control was reached in 2003 under president Reed Byrum who gave seat assignments to the directors, distributed a book on proper board behavior to them, and subjected them to a two-hour lecture on the same topic by a meeting "facilitator."

Board members were warned, as usual, never to talk to the press about PRSA matters. Only the PRSA president is allowed to make a speech or express an opinion. The board never voted on whether PRSA should back Nike in Nike vs. Kasky.

Director Jeff Seideman, who publicly opposed that stance, was not nominated to the next board. He ran from the floor of the Assembly but was defeated. The message was that dissent will be punished.

Jonah Bloom, executive editor of Advertising Age, rapped PRSA president Del Galloway March 1 for giving a "confusing" message about PR.
Galloway, in a letter to AA Feb. 23, said PR is "about building relationships between people and organizations, opening and maintaining multi-layered communications channels and helping organizations and individuals to avoid or manage controversies."

Bloom, former editor of PR Week, said Galloway's "high falutin-but-confusing message" ignores PR's traditional role of "embedding brands in editorial content" that has been "the mainstay of the PR business for more than a century."

Clients like General Motors and Procter & Gamble want mentions in editorial space rather than "zappable" commercial space, says Bloom.

Galloway gave PRSA's usual mass media-avoiding definition of PR. The Society, emerging from its cocoon to express itself on various issues, is going to run into a lot of trouble telling editors that there are plenty of other ways to reach audiences and "build relationships" besides the media. Another indication of this "who needs the media?" attitude is the fact that only 5% of the questions on PRSA's new multiple-choice APR exam are on "media relations." PRSA also shows its disdain for media relations by not having a PR director for the past nine months.

The Council of PR Firms (page one story) is making a stab at providing statistics of some sort for member firms owned by public companies by saying it will report them in broad categories (such as $100 million+). But we won t know which of the 50 or so firms involved are up or down. We don t think Sarbanes-Oxley's insistence that GAAP has to be followed for reporting numbers pertains to items such as payroll and employee totals. But the public ad agencies (WPP, Omnicom, Interpublic, etc.) think otherwise. Meanwhile, the firms that reveal their figures each year and back them up with income tax returns, W-3 statements and other documents (page 7), have an edge in credibility.

PRSA (page 6) has berated the FCC for proposing $275,000 fines for companies that broadcast "obscene" materials. President Del Galloway wants the FCC to provide "clear definitions" of what is obscene. This is a no-brainer.

No one, not even the Supreme Court, has even been able to define what is "obscene." Is the FCC supposed to publish a list of four-letter words and bodily parts that cannot be mentioned? PRSA, in its disastrous backing of Nike in Nike/Kasky, in the definition of PR it gave to Ad Age, and in this demand that obscenity be defined, is revealing its naivete in venturing into the strange (for it) territory of public opinion and debate...PRSA, before lecturing others on the right thing to do, should clean its own house starting with re-writing its member recruitment materials to point out that new members, until they pay $275 and pass the APR test, are deprived of fundamental rights such as being able to serve on the national board or in the Assembly or even speaking to the Assembly.

--Jack O'Dwyer


Copyright © 1998-2020 J.R. O'Dwyer Company, Inc.
271 Madison Ave., #600, New York, NY 10016; Tel: 212/679-2471