FLA. DANGLES $500K CONSTRUCTION PACT.

The Sunshine State, recognizing the construction industry’s vital cog in the Florida economy, is turning to PR to boost a program to recruit workers to the sector.

In the aftermath of two devastating hurricane seasons, the state sees unemployment at record low levels amid the rebuilding, but its growing economy is having trouble meeting the demand for workers in construction industry fields.

In December, the state allocated $6M through its Agency for Workforce Innovation to create and fund the “Florida reBuilds” program, providing entry-level and advanced training to Floridians who want to move into the building sector or climb the ladder.

The program is intended to bolster trades like roofing, masonry, carpentry, concrete finishers, plumbing, HVAC (heating, ventilation, and air conditioning), electricity and heavy equipment operations.

So the AWI has issued an RFP for a PR and marketing firm to evaluate the program and develop and launch its initial marketing plan.
It is offering a $500K budget and a one-year contract to the firm with the best proposal.

Vernique McGirt ([email protected]) is overseeing the solicitation, while Warren May, director of communications for AWI, will manage the resulting contract.

FERNANDEZ TAKES VP POST AT STATE FARM.

Mike Fernandez, chief communications officer for ConAgra Foods, has joined the No. 1 auto insurer State Farm as VP of corporate communications and external relations.

The appointment ends a year-long search by the Bloomington, Ill.-based company, which was looking for a veteran communicator with government affairs savvy. Fernandez takes over for Barb Kirchgasler, who has moved on to another executive leadership position, according to spokeswoman Mia Jazo-Harris.

The 49-year-old executive has held top PR posts at U.S. West and Cigna and was press secretary to former Sen. Ernest “Fritz” Hollings (D-S.C.).

Fernandez previously held marketing and communications posts at Eastman Kodak Co.

State Farm says it administers 73 million auto, fire, life and health policies in the U.S. and Canada. It took a PR hit earlier this month when more than 650 Gulf Coast homeowners sued as a company-commissioned engineering report said home damage was not caused by hurricane-force winds following Katrina, but was the result of floodwater, which is not covered.

FCC PROBES UNSOURCED VNRS.

Federal Communications Commission chairman Kevin Martin is investigating TV stations that presented VNRs as news reports in the aftermath of the Center for Media and Democracy’s survey of 77 stations that aired VNRs with disclosing sponsorship.

The FCC warned stations in ’05 that they could be fined if they air VNRs without disclosing the source of the material.

They could face a $32,500 fine for each violation, up to a $325K penalty for multiple infractions, said FCC spokesperson Clyde Ensslin.

The Center’s study found that though video producers properly labeled the material as being sponsored, the disclosure was stripped before airtime. “We commend the FCC for taking the issue of undisclosed fake news seriously,” said Diane Farsetta, the Center’s senior researcher and the co-author of the report, “Fake TV News: Widespread and Undisclosed.”

EDELMAN ACQUIRES A&R PARTNERS.

Edelman has acquired A&R Partners, a Silicon Valley technology firm with 115 staffers and $15M in billings last year.

Bob Angus, co-founder and managing partner of A&R, told O’Dwyer’s that he and Edelman CEO Richard Edelman began talking about the merger three years ago.

“The more we talked about it, the more we realized it was just a tremendous match,” he said.

“It’s a strategic match, unlike a lot of things that happen in our industry. This one has some tremendous advantages for our company,” Angus added.

The new entity will be called A&R Edelman and brings the largest independent Valley firm under the No. 1 overall independent firm with $260M in ’05 fees.

Edelman’s Mountain View office will merge into A&R’s San Mateo headquarters.

Richard Edelman said the move makes technology the firm’s third largest practice behind consumer and healthcare. Pam Talbot, Edelman’s U.S. CEO, will oversee the acquisition. Angus will serve as president of the unit.

Pam Pollace, the former Intel VP, heads Edelman’s technology practice. Luca Penati, the firm’s former high-tech chief, departed late last year for Ogilvy, along with his wife, Dushka Zapata, an executive VP in Edelman's Silicon Valley office.

A&R has offices in New York, San Diego, Los Angeles, Washington, D.C., Denver, Portland and Louisville. Key clients include Adobe and Palm.

CAIR ASKS ARABS TO FUND $50M PR PUSH.

The Council of American-Islamic Relations is calling on Arab businessmen to fund a $50M media campaign to improve the image of Arabs.

Chairman Pravez Ahmed made that pitch during a speech in Dubai on May 21. He considers the amount a drop in the bucket, especially for oil-rich Dubai which is enjoying a massive economic boom.

Ahmed said a PR campaign would help prevent another “DP World,” referring to the furor over the prospects of Arabs running U.S. seaports.

Rabiah Ahmed, a spokesperson at CAIR’s Washington headquarters, told O’Dwyer’s that the civil liberties group has “spoken to a number of PR firms in the aftermath of 9/11.”

Hill & Knowlton, she added, has been used to develop a series of TV, print and radio ads.
That WPP unit was involved in the recent fracas surrounding Dubai International Capital’s bid for defense contractor Doncasters Group, supplier of aerospace components to Boeing, General Electric, Pratt & Whitney and Honeywell.

BLUE INTRODUCES ‘NEW’ STEEL BIZ.

Edelman’s Blue Worldwide is handling next month’s launch of an image campaign from the American Iron and Steel Institute, Nancy Gravatt, VP-communications told O’Dwyer’s.

The effort is designed to introduce the “new steel” industry to political movers and shakers. Gravatt had high praise for Blue staffers.

She called Blue’s chief creative director Gail Anne Grosso “brilliant.” Grosso doubles as Edelman’s U.S. creative director. Gravatt described Blue president Bob McKernan as “a great strategist.”

Gravatt also emphasized the work of Harris Interactive, which conducted the research for the image work. AISI plans to spend about $3.5M for ads in National Journal, Roll Call and Washington metro stations.

They ads are designed to overcome the image of steel as a dirty and old-fashioned industry. They will play up innovation and technology, touting steel as an environmentally progressive business that contributes much to the nation’s economy.

SMITH LAUNCHES FIRM.

Mike Smith, who was executive VP and general manager of Euro RSCG Magnet’s Washington, D.C., outpost has launched Michael Smith Business Development in Alexandria.

Smith told O’Dwyer’s that he will focus on the telecom sector. “The telecom consolidation trend is now over,” he says, adding “resurgence is at hand.”

Smith says he is a tech guy coming out of the Middleberg side of the Euro RSCG Magnet equation.

He expects the firm will be chasing more consumer accounts now that Edelman’s Lisa Sepulveda is at the helm of the Havas entity. She was executive VP/consumer brands at Edelman.

She told O’Dwyer’s that the firm is not yet ready to talk about Smith’s replacement.

Smith is available at 703/623-3834.

IPG EYES DOUBLE-DIGIT MARGINS IN ’08.

Interpublic CEO Michael Roth said the ad/PR conglom is “breaking the cycle of accounting errors” and expects to post double-digit profit margins in `08 when it achieves “peer growth.”

At the May 25 annual meeting, Roth said IPG was a “diffuse and opaque organization” that is moving to become a “cohesive and fully transparent” operation.

In today’s tricky media environment, IPG can no longer be “advertising-led.” The company is knocking down “silos and stressing an open architecture” that provides all of its advertising/PR/marketing assets to meet the needs of clients.

IPG, according to Roth, is not a “brand.” It is a resource provider, policymaker and financial steward.

Roth said the firm has spent heavily to beef-up its financial controls. He expects outlays for professional fees to drop by $200M in `06 and `07.

Roth hailed IPG’s PR units as “best in class.” He singled out recent Weber Shandwick wins (Northrop Grumman, Abbott Laboratories and Roche) and Golin/Harris (Dow Chemical with sister ad agency, FCB) as major corporate achievements.

The shareholder resolution to “recoup” management bonuses paid during years in which financials were restated was handily defeated. Only 3.8 percent of shareholders supported that measure.

A shareholder asked Roth why IPG “outsourced” its internal financial controls to Deloitte & Touche when it paid $89M to its auditor of record, Price Waterhouse, in ’05.

Roth said IPG needed the integrity of an outsider to help put its financial house in order.

RF PROMOTES TRAVEL TO ALBERTA.

Ruder Finn has picked up the Travel Alberta account, and is charged with promoting tourism to Canada’s fourth largest province.

The firm will work the New York print and electronic media to pitch Canada’s “Rocky Mountain Playground” and its urban and cultural offerings.

Gail Moaney heads RF’s travel and economic development group. Arhlene Flowers and Matt Snow handle the account.

Alberta enjoyed some recent buzz connected to the Oscar winning flick, “Brokeback Mountain” that was filmed there.

Derek Coke-Kerr, managing director of TA, is excited about the new direct air access to Calgary, the “gateway” to the Rockies.

Denver-based Frontier Airlines kicked off twice-a-day direct service to Calgary. It is the first discount American carrier to operate north of the border.

Frontier, in conjunction with Canada’s Denver Consulate, sponsored a “Summertime in the Rockies Sweepstakes.”

Winners will enjoy free lodging at the Calgary Marriott Hotel and receive tickets to Calgary Zoo; Botanical Gardens and Prehistoric Park; Glenbow Museum; Calgary Tower; Heritage Park; and Canada Olympic Park. They will also get a complimentary gondola ride in Banff and a “snocoach” ride on the Athabasca Glacier.

TIERNEY GROUP BUYS PHILLY PAPERS.

Philadelphia Media Holdings, which is fronted by ad/PR man Brian Tierney, is buying Knight Ridder’s Philadelphia Inquirer and Philadelphia Daily News from McClatchy Co. for $562 million.

Gary Pruitt, CEO of McClatchy, called the deal “good for McClatchy, good for the buyers and good for Philadelphia.” He is happy that his company received a “full, fair price” that was consistent with its projections.

Tierney described his group as “long-term owners” who are committed to “vigorous, high-quality journalism.”

Circulation for the Inquirer is down five percent to 350,457 for the latest six-month period. The Daily News is off 9.4 percent at 116,770.

The Philadelphia deal is expected to close this summer, when McClatchy completes its $6.5 billion KR transaction.

McClatchy has now sold six of its dozen “orphans.” The auction of the KR papers is expected to generate $2 billion.

KEKST TAKES LOOK AT ‘ORPHANS.’

Kekst & Co. is representing HM Capital Partners, the Texas-based equity firm that is taking a look at Knight-Ridder’s “orphans.”

HM executives joined by Fort Worth Business Press owner Richard Connor toured the printing plant of the Wilkes-Barre Times Leader on May 22.
Connor is the former publisher of the TL. He left the TL in ’86 to run the Fort Worth Star-Telegram. They also met with current TL publisher Pat McHugh.
HM was formerly known as Hicks, Muse, Tate & Furst The sale price for the TL is reportedly in the $50M to $80M range.

GIBSON NAMED ABC NEWS ANCHOR.

ABC has tapped Charles Gibson of “Good Morning America” fame to anchor the wobbly “World News Tonight” program. He replaces Elizabeth Vargas, who is going on maternity leave this summer.

WTN tumbled into last place in the ratings game last month, trailing NBC and CBS for the first time since ’01.

ABC News president Dave Westin, with great fanfare, appointed Vargas and Bob Woodruff as co-anchors last November. They were presented as part of the youth movement.

Woodruff was injured in a roadside bombing in Iraq on Jan. 29, and is still recovering. Vargas is to return in the fall as co-anchor of “20/20.”
Gibson, 63, will remain at GMA through June. No replacement has been named.

TRIBUNE BUYS REAL ESTATE SITE.

Tribune Co. is buying ForSaleByOwner in a bid to expand its classified advertising offerings. The site has 1.6M unique visitors each month, which puts it in the Top Five ranking of real estate sites.

FSBO charges sellers fees from $90 to $900 enabling homeowners to avoid the traditional six percent real estate commission. The site claims to have saved sellers $1B in commissions since `99.

FSBO allows a seller to post up to 1,000 words and up to six color photos of the property. It also offers support services such as home buying/selling tips and mortgage/neighborhood information.

FSBO says 86 percent of its users sell their homes within five months of posting. There is a money back guarantee if the house doesn't move.

Tribune Interactive, which FSBO becomes a part of, runs CareerBuilder.com, Cars.com and Apartments.com in addition to online versions of its newspapers.

Michael Kaminer PR handles both the TI and FSBO accounts.

NEWS CORP. SLATES U.S. TIMES LAUNCH.

Rupert Murdoch’s News Corp. will introduce a U.S. edition of the Times of London on June 6.

The paper will be printed on the presses of the New York Post, and 10K copies a day will circulate in the tri-state area. A copy will cost $1.

The paper is targeted at upscale readers in the finance area and members of the media. Robert Thomson, editor of the Times, described that group as the “penthouse demographic.”

The printed Times will compete with the Wall Street Journal, New York Times and the Financial Times, which is published by U.K.’s Pearson.

The FT has been in the U.S. since ’97. Thomson was its North American managing director from ’98 to ’02.

LEVINE NAMED ED. CHIEF AT HEARST MAGS.

Hearst Corp. has named Good Housekeeping editor-in-chief Ellen Levine as its editorial director for Hearst Magazines.

The 63-year-old Levine became the first female e-i-c at GH when she took the post in `94. She is responsible for growing its ad pages by 50 percent to 1755 over the past decade. Revenues jumped 160 percent to $481M.

At her new post, Levine is in charge of developing new titles and evaluating opportunities for brand extensions, books, digital alternatives and cross promotions.

Rosemary Ellis, editorial director of Prevention, succeeds Levine. Both report to Cathy Black, HM pres.

Hearst owns 20 titles including Harper’s Bazaar, Cosmopolitan, O The Oprah Magazine, Esquire, Marie Claire and Popular Mechanics.

The Hollywood Reporter plans a daily website covering entertainment and media law news. The site, Hollywood Reporter ESQ, debuts June 5 and the first weekly issue will be published beginning June 6.

The site will have three searchable databases: Industry Dealflow (business transactions and talent deals), Hollywood Docket (litigation complaint filings) and Attorney Rolodex (contact information for lawyers and business affairs executives).

Emily Boak of The Rosen Group (212/255-8455) has info about the new website. The HR is published by VNU.

(Media news continued on next page)

THE WORKPLACE BEAT: A NEW PR PITCH.

Editorial space dedicated solely to life in the office is still somewhat of a new phenomenon, albeit a growing one. As a result, it's common for PR pros to be at a loss on how to pitch story ideas for the workplace beat.

“I’m in the business section, but I don’t see myself in business at all. I’m into people,” said Patricia Kitchen, columnist for Newsday’s Change@Work.

Nearly 100 PR pros showed up to hear some of the nation's top workplace columnists sound off about what makes a good pitch at a May 19 panel hosted by The Publicity Club of New York.

Mackenzie Dawson, editor of the @ Work section of the New York Post, said workplace columns can be distinguished from standard business copy because the former is generally more lifestyle-oriented than the later.

Dawson said the @ Work column, which began in September, looks for stories that are “quirky, opinionated, brazen, and fun.” Many times, a would-be business story can be altered in pitch to accommodate the workplace editor.

“A lot of publicists have a hard time differentiating my section from the business section. I really don’t care about quarterly results,” Dawson said. “If, on the other hand, you have a story about an employee who accidentally sent a mass email out with a spread sheet containing everyone’s salary - now that I want to see.”

Lisa Takeuchi Cullen, staff writer for Time’s Workplace column, defined workplace stories as “the intersection of work and life, people and performance.”

Changing workplace a key theme

Takeuchi Cullen said her columns don’t focus on executive profiles or product reviews. Instead, she prefers trend-oriented pieces that describe “how people are working today, and how the workplace is changing.”

“This is a section that really speaks to everyone,” said Dawson, “from active job seekers to people who might be happy in their current career but who are looking to improve their lot, like getting along better with their co-workers.”

That isn’t to say that workplace columns don’t tackle business. Kitchen said Newsday is interested in stories dealing with international workforce issues, as well as the generational gaps between members of the workforce.

Penelope Trunk, Boston Globe contributor and editor of “The Brazen Careerist,” said some of her favorite topics include working mothers and how members of the Y-Generation have changed the workforce.

In other words, editors want stories that highlight what’s going into the workplace, not what’s coming out.

“We like to talk about the real people who are working today, to give readers a sense of who is out there,” said Katherine Lee, columnist for Working Mother.

The panel said publicists should use the entertainment angle of workplace columns to their advantage because it broadens the range of topics PR pros can pitch.

“You show me a story, I can find a career angle somewhere,” Kitchen said.

Knowing what to pitch within this broad range, however, takes a level of foresight. The panels suggested following trends that are currently hot in the media and tailoring a pitch to accommodate those interests.

“Think like a journalist,” Takeuchi Cullen said. “I imagine that your job is tough because it has so much to do with timing, but if you can see the big story in an influential publication like the Wall Street Journal, chances are it's something we’re thinking about too. It’s a weird convergence where we're all thinking about the same thing at the same time for whatever reason. If you feel a trend coming on, chances are we're feeling it too.”

Blogging draws interest

Case in point: a current hot-topic in workplace publications is the issue of blogging. Takeuchi Cullen said “the word blog is a lot like the word sex to a lot of editors.” Because blogs are still a generally new concept, and because blogging is often related to the workforce, editors are especially interested in the ways the two can intersect.

“I did a story about someone who got fired from their job because of their blog. Blogs are relatively new so a lot of companies have not figured out how to incorporate it into legal procedures – and that’s something I’m very interested in,” Dawson said.

On the other hand, there are topics that will always be mainstays in work-related publications. For example, Dawson said the Post is always looking for entertaining stories about jobs that everyday people don’t have. “We like the kind of stories that people can read about on the subway and say, ‘Wow, that’s cool,’” she said.

Trunk said she’s even more likely to quote a blog because the content is often edgier and many times is written by younger workers who “don’t have a voice anywhere else.”

BRIEFS_____________

Wedding portal The Knot has signed a newspaper distribution deal with Knight Ridder/Tribune Information Services to distribute editorial content from its lifestyle magazine, The Nest, which is beginning a run in print this year. The title covers issues for newlyweds.

U.K.-based Fair Game publishing has launched a U.S. and Canadian edition of Fair Game magazine, a bi-monthly women’s soccer magazine aimed at female soccer players, their coaches and their fans.
The magazine covers every level of women’s soccer, from youth through the collegiate system to the senior women's soccer leagues and national teams.

TiVo plans to launch a TiVo Guru Guide to highlight recommended shows from publications like Entertainment Weekly, Star, Sports Illustrated, Automobile, Billboard, CNET and others.

TiVo subscribers will be able to automatically record Guru Guide recommendations.

American Media, parent to titles like Star, The National Enquirer, Shape, and Men’s Fitness, has launched a corporate website at www.americanmediainc.com.

The big story last week was the conviction of former Enron CEOs Jeffrey Skilling and Ken Lay on fraud charges that could jail them for life.

The Wall Street Journal was exultant at the convictions as well as those of execs at Worldcom, Tyco and Adelphia Cable. The convictions prove that “assertions of widespread corporate fraud back in 2001-02 were way overblown,” said the WSJ.

We think the lesson that executives have taken from Enron, Worldcom, etc., is that there is no need to hide bad results from stockholders and no need to prop up the stock price in order to pull millions and even tens of millions from a company.

There are numerous ways of doing this legally. CEO pay has soared to 600-800 times average worker pay and it’s all perfectly legal. Quite often, the amount of bonuses, restricted stock, deferred compensation, etc., is not related to stock performance.

Perfect examples of this are Interpublic and Omnicom, whose stocks have performed poorly in the past seven years. IPG collapsed from $57 to under $9 and OMC’s stock is around $92 vs. $107 in 1999. OMC’s dividend is 90 cents a year or about 1%. Despite such performance for stockholders, execs of both firms have paid themselves well.

Advertising Age, in a page one story May 22, described the “nice pay for lousy results” being drawn by IPG execs in the past ten years even though IPG has had to restate results for every year since 1997. Audits found $514 million in imaginary profits, on which bonuses were based.

CEO Phil Geier collected $33.2 million from 1997- 2000; John Dooner, $15.5M from 2001-02; David Bell, $7.8M from 2003-04 (plus $18,240 in tickets to sporting events in 2005), and current CEO Michael Roth got $14M in 2005. He could collect three times that if IPG is sold.

Five IPG execs got $124M over the past nine years (vs. $232M as envisioned). Included is $37M in bonuses for years that were later restated.
Proposals at the IPG annual meeting May 25 to recoup the bonuses were defeated.
Dooner had promised that IPG would be “No. 1 in PR” and its Weber Shandwick unit did achieve that in 2001 with $545M in fees (as tabulated by the Council of PR Firms). IPG also owns Golin Harris and MWW, among other PR operations.

While rapping IPG execs on the knuckles, AA seems quite impressed with Omnicom, saying “OMC CEO John Wren and his cohorts were rewarded for handsome performance.” We almost choked on that because OMC stock has gone nowhere in nearly seven years.

Wren is overpaid, according to Forbes, which points out he got $36.6M from 1998-04 while OMC’s six-year “annual total return” was -2%. Wren’s pay in 2006 includes $13.3M in profits from the sale of stock after options were exercised. He got $186,293 in “personal use” of company aircraft in 2005.

Why has OMC stock jumped ten points recently? One reason is the huge share buybacks (nearly $1 billion) that have cut shares outstanding from 187M in 2003 to 181M at the end of 2005. In 4Q of 2005, 1.1M shares were repurchased. Earnings rose 9% in 2005 to $791M, but cash fell $329M to $835M while “net debt” rose $318M. OMC defines “net debt” as total debt minus cash and short-term investments. Financial analysts say “net debt” is a ridiculous concept and that OMC should acknowledge its debt of $2.39 billion without trying to soft pedal it...OMC has slipped back into its old routine of refusing to identify acquisitions, on which it spent $327M in 2005, including 15 new purchases. This habit angers analysts who say they don’t know what OMC is. Reacting to criticism in 2002, OMC identified 17 purchases which included a print broker in Portugal; a company that lets consumers test drive new cars; a private eye firm in S.F. set up by two ex-FBI agents, and a Czech firm that designs training programs...IPG was even more secretive about its acquisitions, reporting more than 200 in its quarterly reports to the SEC, but in almost every instance failing to name the acquired firm.

We must not forget Martin Sorrell, the CEO of WPP (B-M, H&K, Cohn & Wolfe), who took in $40M in 2004, making him the highest paid CEO among the U.K.’s top 100 companies. His pay was more than double No. 2 on the Bloomberg list. While top ad execs pull down record pay, lower level staffers find every penny they spend is pinched by corporate overseers...before making our speech May 17 to the PRSA chapter in Fairfield county, we passed around to the audience of 65 the proxy statement of IPG showing eight different methods of pay for execs beside regular pay, expense accounts, health plans, vacation, etc. These were SCRIPS (Sr. Exec. Retirement Income Plan); CAP (Capital Appreciation Plan–deferred compensation); SARPUS (Share Appreciation Performance Units); MICP (Mgmt. Incentive Corporate Performance Award); ISO (Incentive Stock Options); SARS (Stock Appreciation Rights); PIP (Performance Incentive Plan), and LTPIP (Long Term PIP).

Description of these plans takes up 57 of the 66 pages in the proxy and shows what’s on the minds of IPG managers–$$...the Greenwich Post (an independent weekly with circulation of 14K) did a 2,000-word story on our speech May 25 while the daily Greenwich Time provided no coverage nor did the Connecticut Post. Our reporting career started out at the CP when it was called the Bridgeport Post. But we couldn’t interest the paper. A financial reporter at the BP explained that Greenwich (a half hour from Bridgeport) was too far to go to cover a story. We would think a paper with Connecticut in its title would have correspondents all over the state. GT is now owned by Tribune Co., which we worked for as ad columnist for the Chicago Tribune from 1970-74.

--Jack O'Dwyer