MILITARY IN IRAQ SEEKS PR HELP

The U.S. military is conducting a review to hire four or more PR firms to develop information and psychological operations in Iraq and Afghanistan on a contract that could stretch to three years and $300M.

A spokesman for the U.S.-led command in Baghdad, known as Multinational Force-Iraq, told O’Dwyer’s that the Washington, D.C.-based Lincoln Group is currently working for the military in Iraq. The public affairs officer said that between 20 and 30 staffers from Lincoln Group are assisting the military’s PR team in the Iraqi capital.

A lengthy request for proposals was issued by the Green Zone-based Joint Contracting Command on July 21 to cover “influence campaigns” using media and advertising tactics for the MNF-I.

Media relations, research, public relations, media monitoring and training, and other tactics are outlined in the 105-page document.

The work stretches from training Iraqi government spokespeople to monitoring and engaging Arabic blogs and publishing newsletters for the military coalition.

For Iraq, the military is seeking help to disseminate “media products” to Iraqis to achieve goals like the “re-establishment of an effective Government of Iraq and reconciliation of the country.”

The minimum amount for all projects handled during the expected year-long PR contract—plus two one-year options—is $250K, while the maximum stretches to $300M. Individual projects must fall in the range from $125K-$100M.

The U.S.-led force is seeking proposals through Aug. 22.

SAP PR CHIEF SHIFTS TO B-M

Laurie Doyle Kelly, VP-global PR at SAP AG, has joined Burson-Marsteller as managing director in its technology practice.

Kelly, 43, ran the business software giant’s corporate PR, executive communications, financial outreach and media relations.

She also managed the German company’s relationship with B-M. Before SAP, she spent a decade at The Weber Group.

Kelly reports to Jennifer Graham, global chair of B-M’s tech operation. Based in New York, she is responsible for east coast tech operations.

That oversight includes offices of the WPP Group unit in Chicago, Washington and Boston.

SAP is based in Walldorf. It employs more than 51,000 workers in 50 countries.

MEDIALINK RETRENCHES

Medialink has pulled the plug on its once highly touted Teletrax digital video monitoring system, transferring ownership to partner Philips Electronics.

The broadcast PR company has determined that the “carrying value of the long-lived assets used in its digital video tracking services business is not recoverable and exceeds the fair value of such assets.”

That means Medialink is posting a $1.8M “impairment charge” for the second quarter, which is a contributor to the $10.6M net loss for the period.

CEO Larry Moskowitz announced that his company is selling assets of its British media communications services operations to World Television Group. It is taking another $605K impairment charge from that transaction.

Moskowitz conducted further financial house-cleaning. There is a “goodwill impairment charge” of $3.4M related to the media communications business and another $119K charge for consolidation of its New York headquarters space.

The Medialink CEO believes the broadcast PR firm now has a sharper focus on its overall business, but he warns the “current economic climate continues to pose significant challenges.

The stock of Medialink, which reported a 15.4 plunge in second-quarter revenues to $7M, trades at 24 cents.

Arthur Yann, a former senior VP at HealthStar PR, New York, has joined the PR Society as VP-PR, succeeding Janet Troy, who left in April after nearly four years with the Society. Yann was with HealthStar about a year after leaving CKPR, New York, where he was a senior VP and director for four years.

From 1987 to 2003, he was at Nichol & Co., New York, which was sold to CKPR, Chicago, in 2003. Yann became head of the New York office of CKPR. He is currently vice chair of the honors and awards committee of PRS and a member of PRS/NY.

PRS CANDIDATE GRANT GIVES VIEWS

Steven Grant, senior manager of PR, National Education Assn., and formerly president of the National Capital chapter, the largest with more than 1,300 members, who has been nominated as national board member for the Mid-Atlantic district, has answered questions sent to him by odwyerpr.com.

He is in favor of making printed copies of the members' directory available on a limited basis, exploring

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LIVINGSTON, CLS&A REP ‘IRANIAN DIASPORA’

The Council for a Democratic Iran, a newly minted Alexandria, Virginia-based operation, has hired The Livingston Group and the savvy Chlopak Leonard Schechter and Assocs. PA firm as its communications representatives.

Former House Speaker-designate Bob Livingston spearheads LG’s team. He is joined by Allen Martin, Livingston’s former chief of staff; Lauri Fitz-Pegado, a former Dept. of Commerce and Hill & Knowlton staffer; Richard Rogers, ex-Navy liaison to Congress, and Steve Kreseski, ex-chief of staff to Maryland Governor Robert Ehrlich.

Fitz-Pegado referred this website to CLS&A’s David Mack for comment about the Council. “It is a brand new effort by folks in the Iranian Diaspora interested in raising awareness about human rights abuses within Iran,” he wrote in an e-mail. “As we’ve just begun, there is no website or literature developed yet.” Mack promised to keep odwyerpr.com posted.

There are more than one million Iranians living abroad, including 500K in Los Angeles. Most of them fled Iran following the Islamic Revolution in `79.

CLS&A is part of Gavin Anderson & Co., which is owned by Omnicom.

UST TAPS BREAUX LOTT

UST Inc., the leading marketer of smokeless tobacco products, has retained Breaux Lott Leadership Group for tobacco regulation issues.

The House of Representatives, on Aug. 1, approved the Family Smoking Prevention Control Act by a 326 to 102 margin. That measure empowers the Food & Drug Administration to regulate tobacco.

John Breaux, the former Democratic Senator from Louisiana, and Trent Lott, ex-Republican Senator from Mississippi, are working the UST account, as well as the other six lobbyists at the firm. That group includes John Breaux Jr. and Chester Trent Lott Jr.

UST’s position is that federal legislation should take into account the difference between cigarettes and smokeless tobacco.

The Stamford, Conn.-based company contends that “cigarette smoking is significantly more dangerous than the use of smokeless tobacco.”

UST markets Skoal, Copenhagen and Husky.

PR COUNSELOR BUILDS BIGFOOT BUZZ

Counselor Robert Barrows is working with Searching for Bigfoot Inc., a small company which says it unveiled photos of the carcass of the legendary sasquatch on Aug. 15.

The story has drawn widespread coverage from mainstream media and online as SFB showed photos of a carcass of what they claim is Bigfoot.

Barrows has run R.M. Barrows Advertising and PR in Burlingame, Calif, for 27 years and is also the inventor of tombstones which feature video panels.

The Bigfoot hunters said Bigfoot is “part human and part ape.” The specimen was found in the northern Georgia woods. Media outlets like ABC News, the New York Times, CNN, along with countless Internet sites and blogs have covered the alleged discovery.

MWW PROVIDES PR MUSCLE FOR GOLD’S

MWW Group has been awarded the U.S. PR account of Gold’s Gym, the fitness franchise with locations in 30 countries. MWW takes over for Phoenix-based ad agency Riester following a review.

Gold’s started out near Venice, Calif.’s “Muscle Beach” in 1965 and rose to national prominence with the ’77 documentary “Pumping Iron.” It has since moved its headquarters to Dallas and franchised out to 610 locations in 30 countries from Saudi Arabia to South Carolina.

Senior VP Cheryll Forsatz and VP Joe Cohen head the account for Interpublic-owned MWW. The firm will tackle a full slate of PR tasks in the U.S., including media relations, internal communications, event marketing, partnership development and franchise support.

Cohen said the firm had been speaking with Gold’s for about a year and capitalized when the company recently decided to review its advertising and PR work. [Its ad account went to independent Durham, N.C.-based McKinney.] In a statement, Gold’s chief marketing officer Lisa Zoellner praised MWW’s experience and passion for the brand “evident from our very first conversations.”

MWW previously handled competitor Bally Total Fitness, which went through bankruptcy and a restructuring last year. Forsatz also noted MWW’s experience with franchises like McDonald’s and Alpha Graphics came into play.

Gold’s, which is owned by privately held TRT Holdings, claims nearly three million members.

WELDON WANTED FOR TECH AT FD

Sherrie Weldon, who handled sales and marketing at Text 100, has moved to FD as the financial PR firm broadens its horizon.

At Text 100, Weldon worked on Gartner’s PR, Philips and NXP, the semiconductor operation that was spun off from Philips. She also did a stint at The Hoffman Agency, a shop that served HP, Xerox and Sony. Weldon reports to Mark McCall, who was recently upped to president/CEO of FD Americas. FD is part of FTI Consulting.

PASSENGER RIDES WITH BATEMAN

The Bateman Group has won PR duties for Passenger, a technology company focused on consumer collaboration through social networks, following a competitive review.

Blanc & Otus handled the account for the last year and a half but did not pitch. Budget is in the $200-$250K/year range.

Los Angeles-based Passenger works with blue-chip companies like Chrysler and Coca-Cola to set up and manage online communities for consumers.

Justin Cooper, a co-founder of the company who is chief innovation and marketing officer, said Bateman was “more perceptive, thoughtful, responsive and detail-oriented” than other firms in the review process. “Several” agencies in California pitched.

Fred Bateman, CEO of San Francisco-based BG, called Passenger “the right company with the right technology at the right time in the market.”

GANNETT CUTS 1,000 JOBS

Gannett plans cuts of about 1,000 jobs (three percent of the newspaper staff) in its bid to deal with the restructuring of the newspaper business.

The cuts are slated for the chain’s community publishing group, which does not include flagship, USA Today.

Publishers of its more than 80 dailies have been asked to trim staff to align the papers with reduced advertising levels.

Gannett expects there will be about 600 layoffs with the balance coming from attrition. Layoff notices will go out by September. Gannett CEO Craig Dubow blamed the “struggling economy” especially in its “real estate-centric markets” for its dreary second-quarter results.

The publishing group reported a 13.3 percent drop in advertising revenues to $1.1B. Hard hit categories were retail (-8.3 percent), national (-14 percent) and classified (-18.7 percent).

USAT suffered a 16.6 percent decline in ad revenues as the number of ad pages dropped 19.6 percent to 831. Gannett’s net income declined 36.4 percent to $232.7 during the second quarter on a 10.2 percent dip in revenues to $1.7B.

TRIBUNE POSTS Q2 LOSS

Tribune Company posted a $4.53 billion Q2 loss as it took a $3.85 billion charge related to its 2000 acquisition of Times Mirror.

Q2 revenue dropped six percent to $1.11 billion compared with ’07. Tribune’s sale of Newsday resulted in a $705M loss from discontinued operations.

Interest payments connected to its $8.2B leveraged buyout by chairman/CEO Sam Zell ballooned to more than $211M, up from $112.4M.

Excluding the write-down and loss from the Newsday sale, revenue was down 3.8 percent for the quarter to $168.5M. Zell said Tribune’s results are in line with industry standards and he is optimistic about the company’s future.

NEWSSTAND MAG SALES DROP 6%

Magazine newsstand sales plummeted 6.3 percent during the first-half, according to the Audit Bureau of Circulations, as consumers cut back on spending. Single-copy sales were 44.1M compared to 47.1M for the `07 period.

People and InStyle were the only magazines from the Top 10 that reported gains for the six-months.

Overall circulation remained flat at 3.49.9M copies.

PLANETOUT FACES DELISTING

PlanetOut, the struggling gay and lesbian media company, said it received a notice on Aug. 1 from the NASDAQ that it did not maintain the minimum market value of $5M for the previous 30 days and faces delisting.

The company, which is operating with a $100M deficit, has 90 days to return to compliance.

PlanetOut sold Out and Advocate magazines for $6M in April. Its key holdings include the web portals Gay.com and PlanetOut.com.

AM REVENUE DOWN SLIGHTLY

American Media, which publishes titles like Star, Shape, and National Enquirer, posted a two percent decrease in fiscal first quarter revenue of $119M compared with ’07. AM said the slide reflected a general market weakness for ad spending amid a U.S. economic slowdown.

Chairman/CEO David Pecker said ad pages were down 3.2 percent for the first six months of 2008 which he noted was better than the industry average of 8.7 percent.

Newsstand sales slipped two percent in the first quarter, compared with Audit Bureau of Circulations data which had a 6.3 percent decline for the first six months of ’08.

CHASE NAMED PR CHIEF AT SUN-TIMES

Tammy Chase, director of IR at Sun-Times Media Group, has assumed corporate communications responsibilities. She reports to CEO Cyrus Friedman.

Chase joined the Chicago Sun-Times as a reporter in 2000, and assumed the Lifestyles editor post in `04.

Prior to the S-T, Chase reported for Bloomberg News and The Bond Buyer.

HEARST BUYS CONNECTICUT PAPERS

Hearst is buying the Connecticut Post and seven weekly papers in the state from MediaNews.

The collection includes Darien News-Review, Greenwich Citizen, Fairfield Citizen-News, New Canaan News-Review, New Milford Spectrum, Norwalk Citizen-News and Westport News.

The papers have a combined circulation of 137K daily and 53K weekly.

Joseph Lodovic, president of MN, says the deal allows the company to “manage its balance sheet during a challenging economic environmental and transfer ownership of the CP to a company we admire.”

Lodovic, in a memo to staffers penned with MN CEO Dean Singleton, said the decision to sell CP was not an easy one.

They also noted that the transition to the web is not the biggest problem facing newspapers.

The biggest problem is “an old-fashioned recession.”

They wrote: “Real estate, automotive and employment advertising have been decimated by a slowing economy and a collapsed credit market.”

NYT SELLS MAG COVER

The New York Times sold its first-ever magazine cover wrap on Aug. 10 to U.S. Trust, Bank of America Private Wealth Management.

The ad, wrapped around the spine of the magazine, looked like a partial page. The pitch was for its philanthropic management solutions for high-rollers.

Denise Warren, senior VP and chief advertising exec at NYT’s media group, said the ad shows how closely the paper is willing to work with advertisers. The goal is to “create unique executions and customized opportunities to meet their business objectives.”

(Media news continued on next page)

FBI ADMITS SPYING ON REPORTERS

The FBI admitted on Aug. 8 that it obtained the phone records of newspaper reporters employed at the Washington Post and New York Times, as reported by the Associated Press.

FBI Director Robert Mueller admitted the bureau did not follow proper procedures when it monitored four members of the papers' editorial staffs in 2004. Each of the writers were based in Indonesia at the time, according to the AP, and each was writing stories about Islamic terrorism when the phone records were improperly obtained.

Mueller formerly apologized for the incident.

The 2004 spying snafu was revealed during a recent review of the Justice Department. According to a press release issued by the American Civil Liberties Union, the FBI obtained the phone records by issuing an “emergency” (or “exigent letter”) demand.

The order allows the FBI to obtain National Security Letters — U.S. government-approved subpoenas used to gather private information on individuals — without court approval. In almost all cases, NSL recipients are “gagged” from disclosing that they have been served.

Surveillance tools such as NSL are just one way government agencies have been able to bypass the legal process when gathering information on individuals.

The Patriot Act now broadens the power of the NSL to the extent that it may be served to individuals (U.S. or foreign citizens) who are not even suspects in a criminal investigation.

Since its initial signing into law in Oct. 2001, the Patriot Act has been updated several times to expand surveillance powers for government agencies, notably the National Security Agency, which was the subject of three strengthening bills in the Senate: the National Security Surveillance Act of 2006, the Terrorist Surveillance Act of 2006 and the Foreign Intelligent Surveillance Improvement and Enhancement Act of 2006.

According to the ACLU, the FBI’s use of NSLs has seen an “astronomical increase” since the passage of the Patriot Act — nearly 200,000 issued between 2003 and 2006 alone.

The ACLU will be delivering oral arguments in the Second Circuit of the U.S. Court of Appeals on August 27 in a case where judges found an NSL gag unconstitutional.

“The FBI’s disclosure that its agents secretly sought and obtained the phone records of American newspaper reporters confirms once again that there are insufficient safeguards on the agency’s use of national security letters and other intrusive surveillance tools,” said Jameel Jaffer, director of the ACLU National Security Project in a press release.

“There aren’t enough controls inside the agency, and there aren’t enough checks from outside the agency. Especially dangerous is the FBI’s power to impose gag orders on those ordered to disclose information. These gag orders, which are often unnecessary and almost always overbroad, invite abuse.”

WENNER CUTS RS DOWN TO SIZE

Rolling Stone, which is enjoying its best circulation in history, is shrinking with the Oct. 17 issue to fit newspaper racks.

The 41-year-old magazine has had a drop in single-copy sales from 189K to 132K since '99. Overall circ is at 1.4M.

Greg Armstrong, chief marketing officer at Wenner Media, noted that a standard sized Vanity Fair, an RS competitor, sells nearly three times the number of single-issue sales than RS. He expects a smaller RS to ring up more newsstand sales.

XMAS IN SUMMER WITH GIFT GUIDES

Many holiday guides and special editions are finished by the beginning of September, meaning editorial roundtables are mulling over Christmas ideas. This was the scene at a recent Publicity Club of New York luncheon that brought together an esteemed panel of editorial staff to give PR pros a of what to expect from '08 holiday season.

Rule no. 1 when pitching gift guides: value is key. Most guides are designed for busy people looking for gift ideas, with "clever finds" that lead customers to a buy-for-the-buck purchase. Janet Siroto, executive editor of Good Housekeeping, said her magazine's annual gift guide only features items that cost less than $50. The same goes for Better Homes and Gardens' annual guide, according to senior deputy editor Oma Ford. Ford said this year's guide will also feature a special section for items that cost less than $10.

"Our readers are very conscious of their pocket books and the concept of value," Ford said.

Eye-catching photos are another must. Erica Cerulo, associate editor of Details, said gift guides serve as a "wish list" for many families, and their visual allure makes them photo-driven by design. Cerulo said that while her magazine's holiday guide does not have a price-point, its penchant for fashion and gadget-related products puts a responsibility on PR pros to submit attractive, high-quality photos. Seth Porges, associate editor of Popular Mechanics, agreed, stating that his magazine relies primarily on "things that guys want."

"PR people are a thousand ears and eyes looking for products. We like to know what's going on in the market - we hope we know what's going on in the market. If it weren't for you I'd have to call the manufacturers myself," he said.

The panel also said pitches should showcase new items, and should be exclusive to the magazine that features them.

Finally, most holiday gift guides have evolved to add an online component in recent years. In some cases, the online counterpart is now bigger than its print edition.

Ford said Better Homes and Gardens has an entirely different staff for its online edition, as well as blog features that offer even more pitching opportunities.

Porges said popularmechanics.com has "tons of room for additional coverage" and additional possibilities for video content.

The power of a few words to cause a major financial dislocation was told by a New York Times article Aug. 15 on the current home mortgage crisis.

Those words are “home equity” (which replaced “second mortgage”). Second mortgage was one of the worst things you wanted on your home but millions of people thought it was o.k. to get a “home equity” loan which was the same thing (unless you had already paid off your entire mortgage).

“Live Richly” featured Citicorp ads that cost $1 billion from 2001-2006 (created by Fallon Worldwide of Publicis). It told homeowners there’s “at least $25,000 hidden in your house. We can help you to find it.”

With other financial houses blasting the same message, home equity loans soared from $1 billion in the early 1980s to more than $1 trillion.

Homeowners went on a borrowing rampage in the early 2000s, when the prime rate was as low as one and two percent and home prices were skyrocketing. They are licking their wounds now as interest rates soared and housing prices plummeted.

The NYT lays this debacle at the doorstep of “marketers” who took over bank strategy and started selling loans like packaged goods complete with fatuous slogans like “You don’t have to sell your home to get $10,000, $30,000 or even more in cash” (ad by CIT Financial).

The hugely profitable and overpriced PR wire services are in a tizzy over the SEC’s view that company websites can satisfy disclosure (8/13/NL).

Some financial blogs are wondering if this is “the demise of the (PR) wire services?”

PR Newswire of UBM reported $98M in gross profits and about $85M in net profits for 2007 while Lorry Lokey’s Business Wire made so much money he was able to give more than $400 million to schools and charities. UBM said PRN contributed almost one-third of its gross profits of $340M. Unsatisfied with the operating margin of 34.8%, PRN told scores of employees to move to low cost Albuquerque if they wanted to keep their jobs, closing editorial functions in 11 cities.

Companies using PRN pay a $195 annual “membership fee.” BW stopped a similar practice. The national wires of PRN and BW cost $650 per release while Marketwire and PrimeNewswire cost $460 and $435.

Big users of PRN and BW are the conglomerate-owned PR firms which almost automatically put releases on one or more of the PR wires, some of them marking up the bills 15-20% and pocketing millions in easy profits.

The wires prospered as SEC rules forced companies to add hundreds and even thousands of cautionary words to each release. The wires charge by the word even though every document, no matter how large, is sent in a nano-second. Now, however, companies need only give the wires a paragraph and provide a link to the company website. The head of the PR wire “Golden Goose” is on the chopping block. PRN is accepting such “notice” releases but BW refuses them. “Official” SEC disclosure media are Dow-Jones, Reuters, Bloomberg, NY Times, AP, USA Today and Investor’s Business Daily (any one of them). PR wires are not on this list.

Five candidates for the PR Society national board have now expressed their opinions on issues facing PRS and we applaud their participation in this democratic exercise. They are hopeful of change but we don’t think it’s possible.

The very instrument of change—governance—is itself broken. This is like a physician with two broken arms trying to set them. He or she needs help.

Governance is broken because the only body that can change things (the Assembly) meets only one day a year and more than 90% of its time is spent listening to leader presentations.

Rank-and-file members, the delegates and chapter presidents should be discussing on the PRS website governance reforms such as removing the APR requirement from the board; moving the charter to Delaware to allow electronic meetings all year long by the Assembly and/or chapter presidents; again publishing the printed directory of members; abolishing proxy votes, and considering the Central Michigan proposal to copy governance of the ABA and AMA, to name some needed reforms.

No such discussions are allowed in Tactics or the PRS website (in spite of the code espousing “free expression”). CEO Jeff Julin, after promising new bylaws at the 2008 Assembly, now says he will only take suggestions at the Assembly.

PRS governance is irretrievably broken and cannot repair itself. A group of PR veterans is drawing up articles of incorporation for a new national society that, among other things, will have a panel of PR pros, reporters and members of the public who will listen to complaints about abuses in communications from anyone and subject their findings to public dialogue.

In researching the history of PR we came across the views of Paul Garrett, PR head at General Motors in the 1930s and a founder of the PR Society in 1947.

Garrett, who was financial editor of the New York Post, believed in putting the words public relations “a different way—relations with the public.” He did not use the word “publics.”

The philosophy of PR “turns not upon the needs of industry but upon the needs of the customer,” he wrote in 1938. PR, he believed, “was a fundamental attitude of mind, a philosophy of management, which deliberately and with enlightened selfishness places the broad interest of the customer first in every decision affecting the business…it is the philosophy of doing things people like and doing them the way they like it.” PR, he further said, must start “not with what people ought to think but with what they actually do think. An opinion deeply rooted in the consumer consciousness is just as much of a fact as a scientific finding from a research laboratory…there is no place for PR that connives or squirms or distorts facts. PR is honest. It is frank. It is open. It has vigor…PR is industry’s No. 1 job.”

--Jack O'Dwyer