PENTAGON OUTSOURCES PSY-OPS.
The U.S. Special Operations Command has selected three private sector companies to provide psychological warfare services.

Lincoln Group, which handles PR for the U.S.-led force in Iraq, SYColeman, part of L-3 Communications Group, and Science Applications International will pull in at least $250K for the first year and $500K each additional year on a contract that could balloon to $100M by the end of the decade.

SOCom put out a “sources sought synopsis” in December to hear from firms to help “enhance research, media development, and operational capabilities.” SOCom’s mission is to “disrupt, defeat, and destroy terror networks that threaten the U.S. worldwide.”

SAI put together the U.S.-run Iraqi Media Network operation after the fall of Baghdad in ’03, according to Media General News Service, which first reported the new psy-ops assignments. SYColeman put together the Army’s website for the only Medal of Honor winner from the Iraq invasion, www.army.mil/medalofhonor.

PUBLICIS TAKES BIG FREUD STAKE.
Publicis Groupe has acquired a 50.1 percent stake in London’s Freud Communications, which is the U.K.’s No. 1 consumer PR firm.

The ad/PR conglom did not give any financial details, but the Financial Times reported the deal values the privately owned FC from $85M to $97M.

FC has more than 100 staffers, and counts Nike, AOL, Nestle, Tropicana, Jack Daniel’s, London Development Agency and Sony Pictures as clients.

Publicis CEO Maurice Levy praised Mathew Freud as a “unique and innovative presence” in British PR.
Freud, a descendent of Sigmund, is married to Elisabeth, the daughter of Rupert Murdoch.

COONEY TO EXXON MOBIL.
Philip Cooney, the former chief of staff for the White House Council on Environmental Quality who resigned June 10, will join Exxon Mobil in the fall.

The former American Petroleum Institute lobbyist had edited reports downplaying the links between greenhouse gases and global warming. The New York Times broke that story on June 8, and Cooney submitted his resignation on June 10. The White House says there is no connection between the edited reports story and Cooney’s resignation.

Exxon Mobil was profiled on the Wall Street Journal’s June 14 front page as the leading corporate skeptic on the global warming front.

DOWIE, STODDER TRIAL PUSHED TO NOV.
The trial date of former Los Angeles Fleishman-Hillard executives Doug Dowie and John Stodder has been pushed back from Aug. 2 to Nov. 11 to allow more time to review more than one million e-mails and other documents to be submitted as evidence in the overbilling case.

Both men have denied any role in overcharging the Los Angeles Department of Water and Power.

F-H, in April, agreed to settle its legal squabble with the city, paying $4.5 million and waiving $1.3 million in unpaid invoices for PR services.

Dowie had headed F-H’s Los Angeles office. Stodder was senior VP.

JWI LANDS $2M ENERGY PACT.
Camelot Oil and Gas Development has inked a $2 million six-month contract with Jefferson Waterman International for government relations in the U.S. and the Caspian Sea region.

The London-based company is owned by Khagani Bashirov, an Azerbaijani, who wants to exploit oil and gas opportunities in the area.

The land-locked energy-rich Caspian Sea, which is bordered by Azerbaijan, Russia, Kazakstan, Turkmenistan and Iran, has been touted as an alternative energy provider to the Middle East.

U.S. Energy Secretary Samuel Bodman was on hand last month for the opening of a $3.2 billion pipeline that carries crude from Azerbaijan through Georgia to Turkey’s Mediterranean port city, Ceyhan.

JWI and Camelot will decide on Sept. 1 whether to extend or terminate the contract.

Charles Waterman, who was vice chairman of the Central Intelligence Agency’s National Intelligence Council, is founder of JWI. Firm president Sam Wyman spent more than 30 years at the CIA.

BYRUM, FREDMAN RAP PRSA LEGAL STEPS.
Reed Byrum, 2003 PRSA president, and Ron Fredman, president of the Kansas City chapter (speaking for himself), have criticized the legal steps PRSA has taken to unveil an anonymous e-mail critic of PRSA COO Catherine Bolton.

Judy Phair, PRSA president, said she and 2004 president Del Galloway were guided by PRSA law firm Moses & Singer in seeking the identity of the e-mailer, noting that this action is “not a lawsuit.”

Executive committee and board approval would have been sought were the action a lawsuit, she said.

(Continued on page 7)

VOCUS FOCUSES ON IPO.
Vocus Inc., which launched its first PR software platform in 1999 and had revenues of about $20M last year, has filed a registration statement with the Securities and Exchange Commission for an initial public offering.

The company said it plans to use the proceeds to pay off $3.2M in debt and support growth and possible acquisitions.

Revenues for 2004 were about $20.3M, up 32 percent from $15.4M in 2003. Vocus has not yet turned a profit and posted operating losses of $3.6M in ‘03, $2.8M in ‘04 and $929K through March 31, 2005. It has $7.8M in cash and cash equivalents.

The company, based in Lanham, Md., sells its software on annual or multi-year subscriptions and said, as of March 31, it had 1,100 customers, including Washington Mutual, Cisco Systems, Lowe’s Companies and the U.S. Dept. of Health and Human Services. About seven percent of its clients utilize multi-year deals.

$110B in PR spending

Vocus’ prospectus contains some lofty projections for PR. The company estimates, based on a Harris/Impulse Research survey of PR last year, that PR budgets rose 15.5 percent per year from 2001-2004.

Further, Vocus estimates that the “aggregate annual PR budgets” for companies with revenues of at least $10M were $110 billion in ‘04. Based on that figure, and the U.S. Dept. of Labor’s projection that PR is a sector where employment will increase faster than the average occupation through 2012, Vocus sees a $2 billion market for PR software.

QUINTANA TAPPED BY B-M.
Burson-Marsteller has named Al Quintana chairman of its U.S. Hispanic practice. The Miami-based Quintana reports to Santiago Hinojosa, who is CEO of B-M/Latin America.

Quintana has more than 20 years of PR experience, including serving most recently as VP-marketing communications at a unit of Telefonica SA.

B-M has Hispanic practice staffers in New York, Austin, Miami, Chicago, Los Angeles, San Francisco, San Juan, Dallas and Washington, D.C.

KETCHUM MELDS OLD, NEW MEDIA.
Ketchum has launched “Ketchum Personalized Media,” a group of existing executives that will provide counsel about online tools such as blogs, podcasting, Really Simple Syndication, Search Engine Optimization and mobile marketing.

The Omnicom unit’s high-tech guru and Chicago managing director, Paul Rand, co-leads the new group with Jon Higgins, CEO of Ketchum/Europe.

Rand believes KPM will help clients deal with “conflicting information and anxiety” about online technologies, and counsel them about integrating online technologies into their traditional communications programs.

PRSA treasurer Rhoda Weiss and directors Steven Lubetkin and Tom Vitelli are running for president-elect; Lubetkin, Vitelli and secretary Jeff Julin are running for treasurer, and Lubetkin, Vitelli and director Sue Bohle are running for secretary, PRSA announced.

FCC RELEASES ‘PAYOLA RULES.’
The Federal Communications Commission released a new “fact sheet on payola rules” on June 15, and Commissioner Jonathan Adelstein wants TV viewers to monitor media and report violations of the guidelines.

He likened that effort to a “Neighborhood Watch program” and believes that “putting viewers on alert will help us enforce the law and deter future abuses.” Adelstein, a tough critic of sponsored programming, made that remark in a statement applauding the release of the payola fact sheet.

He warned broadcasters to take the payola rules seriously because those that break the rules could face a year in jail. “But even beyond the penalties, it is the longstanding policy of this country that the American people have a right to know who is promoting a product, policy or message to them,” he said.

According to the FCC fact sheet: “When a broadcast licensee has received or been promised payment for the airing of program material, then, at the time of the airing, the station must disclose the fact and identify who paid for or promised to pay for the material.”

Rudy Brioche, a spokesperson at the FCC, told O’Dwyer’s the payola rules do not deal with the uproar surrounding government propaganda presented as news.

He did note that Section 317 of the Communications Act requires broadcasters to disclose VNRs dealing with controversial political issues.

Adelstein railed against the “increasing commercialization of American media” during a May 25 speech at the Media Institute in Washington, D.C.

He talked about VNRs “masquerading as independent, legitimate news” and “PR agents pushing political and commercial agendas that squeeze out real news coverage and local community concerns.”

Americans, he said, are frustrated with the barrage of “fake news and relentless marketing.” They are “angry when they do not get real news and accurate information that empowers them to make informed decisions. It is no wonder trust in the media is at all-time low.”

MONTICELLO BETS ON 5W PR.
Empire Resorts, which operates Monticello Raceway, has hired 5W PR for media relations, PA, community outreach and promotion. The track is one-hour north of New York City in the Catskills.
The company opened the Mighty M Gaming facility featuring 1,800 video gaming machines last June at the race track. It now wants to construct a $500 million casino at the track in conjunction with the Cayuga Nation, but needs political support.

New York Governor George Pataki had supported the construction of five casinos in the Catskills, but scaled back that plan on June 9 due to heavy opposition from environmentalists and politicos.
Pataki now supports a single casino for the St. Regis Mohawks at Kutsher’s Sports Academy in Monticello.

Empire is pushing its Monticello gaming facility as the “logical choice” to settle land claims of the Cayuga Nation.

FIRMS PLAY HOST AT JOURNALISTS’ DINNER.
Twelve PR firms bought 13 of the 36 tables at the N.Y. Financial Writers’ Association’s annual awards dinner on June 13.

The PR firms with tables were Burson-Marsteller, Dilenschneider Group, Edelman Financial, Fleishman-Hillard (two tables), GFI Group, Joele Frank Wilkinson Brimmer Katcher, Kanter & Co., Kekst & Co., RF Binder Ptrs., Rowan & Blewitt, Torrenzano Group, and Walek & Assocs.

Many of the guests at the PR tables, which sat 10 people, were financial journalists for various media.
The pre-dinner festivities at the Marriott Marquis Hotel in Times Square included the induction of Myron (Mike) Kandel, who recently retired as founding financial editor of CNN, into the NYFWA Financial Journalism Hall of Fame.

Kandel was seated at the head table with his wife, Thelma and daughter Bethany, and the new officers of NYFWA—Richard Koreto, Advising Boomers Magazine, president; Britt Erica Tunick, Fund.com/AccreditedInvestor.com, VP; Grace Weinstein, freelance writer, treasurer, and Sheila Mullan, Market News International, secretary-asst. treasurer.

Byron (Barney) Calame, who recently joined The New York Times as its public editor after nearly 40 years at The Wall Street Journal, was presented the Elliott V. Bell Award for his contribution to the profession of financial journalism.

Kandel, a former president of NYFWA, also introduced William McDonough, chairman of the Public Company Accounting Oversight Board at the Securities and Exchange Commission, as the keynote speaker.

Eight students from New York universities and colleges were each awarded $2,400 scholarships in memory of “distinguished” members of NYFWA.

MEDIA BRIEFS________

BMW North America in Woodcliff Lake, N.J., has drawn up plans for a series of comic books based on “The Hire,” a series of eight Internet movies featuring British actor Clive Owen as a driver whose clients face danger around every curve.

The comic books will be published in partnership with Dark Horse Comics.

Garden Design, a magazine published six times a year by World Publications in Winter Park, Fla., is adding an online version of the publication that readers can use to search for local retailers offering products and services mentioned in the print version of the magazine.

Event Design Magazine in Norwalk, Conn., will debut in Oct. with a controlled circulation of 10,000 designers, architects, creative directors, and purchasing managers, according to editor and publisher Dan Hanover, who said the magazine will cover both the form and function of events, exhibits and environments.

Inspiring Heart, a DVD magazine covering the positive lifestyle, with features on personal and spiritual development, entertainment, news and opinion, healthy living, the arts and more, will be started as a monthly by Closer to the Dream Ltd., which has offices in Los Angeles and London.

Terry Malloy, who is editor-in-chief and CEO of Closer to the Dream, based in London, said each issue of IH will have regular segments, including discussions with celebrities on what inspires them, and a film documentary on an uplifting topic.

Fader Magazine’s newsstand circulation has grown to 84,000 with an audience of 588,000 readers, according to Andy Cohn, publisher of the magazine, which increased its frequency from six to eight issues a year in 2005.

Publicists for New York-based Fadar said the magazine “aggressively covers the most dynamic breadth of music and style emanating from the fringes of the mainstream to the heart of the underground.

“Editorially, Fadar has established itself as a book that stays ahead of the curve, identifying and exposing new music before it breaks. It is looked to as a source of what is next, with other magazines and broadcast media,” said Marisa Brickman and LinYee Yuan at 212/741-7100.

Digital Life magazine’s summer edition went on sale this week on newsstands nationwide and in retail outlets this week.

The first issue has information on how to get the most from consumer electronics and video games, and showcases the magazine’s editorial mission, which is to feature “a wealth of neat gadgets and gizmos,” said Jeremy Kaplan, who is editor of the magazine, published by Ziff Davis Media in New York.

Meximerica Media is getting $18 million from Pinto America Growth Fund of Houston and Rustic Canyon Ptrs. of Los Angeles to complete the building for its four daily Rumbo Spanish-language newspapers in Texas and continue rolling out elsewhere, according to Edward Schumacher-Matos, CEO of Meximerica.

Bloglines, an RSS aggregator, says it has stored half a billion blog articles and news feeds during the last six months.

The U.S. Virgin Islands once again will host the annual Caribbean Tourism Conference, scheduled Oct. 22-26 in St. Thomas.

M Booth is handling publicity and arrangements for the 28th annual CTC, which attracts tourism industry officials representing Caribbean goverments, hotels, airlines, cruise lines, travel agents, tour operators, and writers from around the world.

MEDIA NUMBERS_______
56—The percentage of adults in a recent Gallup poll that had no knowledge of blogs.

16.6—The number of hours people, globally, spend watching TV each week, according to NOP World’s new “Media Habits” index.

(Media news continued on next page)

PR NEWSWIRE SAYS SURVEY WAS ‘SKEWED’.
The spokeswoman for PR Newswire said the results of a newswire survey of 10,000 newspeople, which was conducted by Brodeur Worldwide, was inaccurate (NL/June 8, pg. 4).

Brodeur conducted the survey for client MarketWire, a PRN competitor based in Los Angeles.

“The article neglected to point out that just over 150 people actually responded to this survey, thus skewing the results significantly,” said Rachel Meranus, PRN’s director of PR.

“For example, the finding that indicates 73% of respondents said ‘no, not me’ when asked if they monitored newswire websites for content has a lot less weight when you realize it’s 73% of 150 rather than 73% of 10,000,” Meranus said.

PR PRO: DAILIES NEED TO HIRE HISPANICS.
Joe Ledlie, a former city editor turned PR pro, believes the decline in circulation of major newspapers can be traced to the low number of Hispanic newsroom employees.

Ledlie, who heads The Ledlie Group in Atlanta, Ga., said 12% of the U.S. population are Hispanic, compared to only 4% of newsroom employees.
“The 12% figure is rising, of course, but the 4% figure is holding steady,” said Ledlie, who points out Hispanic newspapers are thriving, and Anglo publishers are buying into them big-time.

BOOKER USES ‘THE RULES’ TO PITCH.
Janett Rizk, an A/E at RLM PR in New York, finds the 1996 book, “The Rules: Time Tested Secrets for Capturing the Heart of Mr. Right,” are useful in dealing with the media.

While the book, which was co-authored by Sherrie Schneider, a former reporter for Jack O’Dwyer’s publications, is “just short of prehistoric to a 2000’s women,” Rizk said the book provides relevant guidelines for PR pros for pitching stories to “hard-to-get” journalists.

She cites several examples, including “Rule #1—Be a creature unlike any other.”

Rizk said PR pros should “differentiate yourself and your client” when pitching a story by offering more than one story angle, and deliver each idea with absolute confidence.

She also follows “Rule #2—You might not meet Mr. Right naturally and you therefore must take social action immediately, even if you don’t want to.”
“Make yourself available to build relationships with the media,” said Rizk.

“Attend any networking events. Take the time to get to know editors and reporters over the phone, and in person by making appearances at industry events, meetings, and other social gatherings,” she said.

Emily Sacher is joining the Reader’s Digest as director of its website (RD.com).

Sacher was site director and executive editor for Meredith Corp. where she oversaw websites for Ladies Home Journal, Better Homes and Gardens and More Magazine.

—Billboard has hired Bill Werde to serve as editor of Billboard.biz.
Werde, whose title is senior editor, comes from Rolling Stone where he covered technology and business.

—WeightWatchers.com has named Amanda Genge an associate editor. She had been a fashion and beauty writer at Woman’s World.

—OK! has hired Rachel Rabkin, formerly health editor at Parents magazine, as health editor, and Valerie Nome, previously a freelance writer for Us Weekly, Entertainment Weekly, TeenPeople.com, as a writer.

—This Old House’s website is now edited by Jim Nash, formerly managing editor of interactive products at Information Week.

—Time Out New York’s new “Chill Out” editor and comedy editor is Jane Borden, who was previously comedy editor and a writer for Around Town.

—Accent magazine has named Robert Haynes-Peterson managing editor. He had been managing editor at Body.

PEOPLE_______

Chiqui Cartagena, who is author of “Latino Boom!,” a business book on the Hispanic market to be published Aug. 30 by Ballantine Books (Random House), is joining Meredith Corp. as managing director of multicultural communications for Meredith Integrated Marketing, a new position in the publisher’s New York offices.

Richard Johnson, 51-year old editor of The New York Post’s daily gossip page, “Page Six,” is engaged to marry Sessa von Richthofen.
This will be his second marriage—his first was to publicist Nadine Johnson, which lasted 15 years.

Bob Costas, a 25-year veteran of NBC, is filling in as a substitute while CNN’s Larry King is away, and will sit in upward of 20 times a year, according to Newsday.

Richard Martin, previously deputy editor, was promoted to editor-in-chief of Complex magazine.

Eric Chandler, previously head of PR for LPI Media, was named PR director of Bauer Publishing in Englewood, N.J.

Laurie Brookins was named senior fashion writer for Ocean Drive and Las Vegas and an executive editor for Wynn Las Vegas magazine.

Jolanta Bielat, previously at New York Magazine, has joined Organic Style magazine as associate photo editor.

Wenner Media “praiser Lisa Dallos ankled the publisher” on June 10, according to Variety.

Dallos was director of publicity for all WM publications, including Rolling Stone, Men’s Journal, and Us Weekly.

It’s clear where PRSA leaders are placing the responsibility (blame?) for the legal pursuit of the e-mailer who criticized COO Catherine Bolton.

It’s on PRSA’s law firm, Moses & Singer.

Ducking public discussion of this matter are the members of the 2004 and 2005 boards who did not even vote on the issue. Are they “off the hook?” No.

President Judy Phair told us via phone that she and 2004 president Del Galloway “followed the advice of counsel” in initiating the action last Nov. 16.

Janet Troy, PRSA PR director, sent us this e-mail:
“We are not suing anyone. The court has found for Catherine in the pre-action disclosure. The action was initiated on the advice of counsel to the Society and Catherine as the action was viewed as interfering in the governance of the Society. It also presented a safety concern.”

The second mention of “action” refers to the “Catherine Hater” e-mail sent to the board. PRSA is apparently saying there is a concern CH might do something violent.

Especially missing in this debate is president-elect Cheryl Procter-Rogers, whose own company, Time Warner, got hit with two legal actions. She feels it’s a legal dispute and she can’t comment.

But it’s far more than that.

As far as we know, Procter-Rogers has raised no objection whatever to this “outing” that is of supreme concern to PRSA members and the general public. This case is the first one of its type in New York and could set a dangerous legal precedent.

Also unheard from is Gerard Corbett, who represents the other major corporation on the PRSA board, Hitachi. We urge both companies to take a close look at the use of their brands by PRSA.

There are huge PR/First Amendment and other considerations here besides legal ones.

A good part of the country is running these days on information posted anonymously on blogs, websites, finance/yahoo and similar chat rooms, letters-to-the editor, etc.

Almost all the postings on the O’Dwyer website by PR people are anonymous because contributors don’t want to be hit on for expressing an opinion. people will worry about saying “boo” about anything if they think an e-mail provider will “out” them at the drop of a legal petition.

Time Warner Cable, by the way, put up no fight when M&S came to it with a subpoena demanding that its Road Runner brand give up the owner of an e-mail address and list of people e-mailed to by this address. As is its practice, TWC did not even show up at a court date for this. TWC told the owner of the address that it was his/her problem to respond.

“John Doe” hired law firm Quarto Dunning which crafted a 13-page reply to the court with numerous legal arguments and citations of relevant decisions. M&S had started the legal action with a two-page, one-paragraph petition that QD called “threadbare.”

QD’s best argument was that Bolton had suffered no “economic harm” and that this was essential for a finding of possible defamation. The QD rebuttal resulted in Judge Kibbe Payne writing a decision of thousands of words that ran in the New York Law Journal after it front-paged a previous story.

TWC was hit with another “legal action” ordering it to turn over CH’s e-mail records and it complied.

We wonder if PRSA and M&S were anticipating such a hub-bub? Maybe they thought the mere “outing” of CH would end the e-mails and thus warn other potential critics without the need for a public defamation lawsuit in which many PRSA staffers and others would have to testify under oath.

PRSA, whose last press conference was in 1993, has a record of not liking to air matters in public.

Who’s running PRSA anyway, the board or Moses & Singer?

Arthur Abelman of M&S is on both the governance task force named by Galloway and the 2005 nominating committee in an “ex-officio” capacity.

How many associations allow someone from their law firms such influence? Governance at PRSA needs an overhaul but it’s not going to be done by the very people who are not sharing power.

The worst example of the abuse of power in PRSA’s history was the move downtown in 2004 without the knowledge or approval of the Assembly.

This 13-year commitment worth $6 million was PRSA’s biggest investment ever. Headquarters turned its back on PRSA/New York and the rich New York PR/communications market, as evidenced by the record $580,000 profit PRSA made on the 2004 national conference in New York.

Bolton’s managerial abilities have been questioned by the anonymous e-mailer. But is that so far-fetched?

She is a “public figure” in the PR community and defamation charges are harder for public figures to prove. Bolton joined PRSA on Sept. 3, 2000 as “chief PR officer” from the International Copper Association where she was VP-communications. By December she was acting president and COO and president and COO in January 2001, heading a staff of about 50.

Predecessor Ray Gaulke quit those posts suddenly in October 2000. He had been picked in 1993 after a lengthy search by a committee of six and a fee of $40K to Korn/Ferry.

We question some of the actions made at h.q. including the sudden departure in July 2004 of Rob Levy (without explanation) after he boosted training income 61% in the first half to $1.28 million. The move of h.q. downtown was championed by Bolton and we think it was one of PRSA’s worst decisions ever.

We also question this legal action in which she is a complainant.

– Jack O'Dwyer