GIBBS SLATED FOR WH PRESS SECRETARY

Robert Gibbs, senior communications strategist for the Obama-Biden campaign, is expected to move to the White House in January as press secretary in the Obama Administration.

The Alabaman has been a communications director for Barack Obama since he entered the Senate in 2004.

He was press secretary for Sen. John Kerry’s ’04 Presidential bid and communications director for the Democratic Senatorial Campaign Committee.

Gibbs had a YouTube moment during the Presidential campaign when he confronted Fox's Sean Hannity on-air about a dubious program run on the network titled "Barack Obama: History of Radicalism."

SERBIA TARGETS U.S. MEDIA ‘BIAS’

Serbia has inked a $50K a-month pact with Bethesda-based 30 Point Strategies in a bid to buff its image and overcome a perceived bias in the U.S. media.

30 Point is to handle a broad range of issues including economic development, tourism promotion and Serbia's bid to join the European Union. It also will highlight Serbia's effort to apprehend war criminals.

30 Point contends American media are woefully uninformed about "Serbia's western-oriented leadership and government policies," according to its pitch letter. Media targeted for placements include the New York Times, Wall Street Journal, Fortune, Chicago Tribune, and Atlanta Journal-Constitution.

Noam Neusner and Adam Levy are principals at 30 Point. Neusner was President Bush's speechwriter on domestic policy matters, handling tax relief, Medicare reform, energy and environmental issues.

Levy is a former journalist (Atlanta bureau chief for Bloomberg News) and Wall Street research analyst (Donaldson Lufkin & Jenrette).

F-H’S AMBLER JOINS BNSF

John Ambler will join Burlington Northern Santa Fe Railway Nov. 17 as VP-corporate relations. The Fleishman-Hillard senior VP succeeds Mary Jo Keating. He moves from Houston to Fort Worth with the job shift.

Prior to F-H, Ambler was global leader-comms. and public affairs at GE Energy, spent six years at various Enron subsidiaries, and 17 years at Texaco, working on state, federal and international public policy issues.

Ambler will report to Roger Nober, executive VP-law and corporate secretary. Keating joined BNSF from Northeast Utilities in 2006 taking over for the retired Dick Russack. The 32K-mile BNSF system generated nearly $16B in revenues last year.

FTI POSTS 20% GAIN IN Q3 NET

FTI Consulting, parent company to global PR firm FD, reported a 20 percent surge in third quarter net income to $27.5M in what CEO Jack Dunn called “one of the most volatile and tumultuous periods in business history.”

Revenue for its strategic communications segment, which includes FD, rose 24 percent to more than $56M, up from $45M in ’07 and buoyed by financial crisis management assignments and stronger spending from clients in the U.K. and U.S. Those gains offset "significantly lower" M&A and equity capital markets communications assignments.

Dunn said that while FTI's business units, which also include restructuring, tech consulting and M&A counsel, generally profit from market change and volatility, the unprecedented scale of the quarter's downturn hurt its bottom line.

MCKILLOP MOVES TO KKR

Peter McKillop, a former journalist who is senior VP of corporate communications for Bank of America's consumer and small business bank, is slated to join Kohlberg Kravis Roberts & Co. on Nov. 17 as director of global communications.

McKillop will report to former Bush aide Ken Mehlman, who joined the private equity firm in April and heads global public affairs for KKR.

McKillop was managing director for marketing and comms. in the Asia-Pacific region at JP Morgan & Co. before joining BoA in 2004. He joined JP Morgan after working in Japan for Burson-Marsteller, where he was a managing director.

KKR is planning an initial public offering, although the move has twice been delayed in the last year.

GM VP SAYS AUTO FAILURE IS WORRISOME

Steve Harris, VP, global communications, General Motors, told the Institute for PR on Nov. 5 at the Yale Club, New York, that failure of the U.S. auto industry would have a devastating impact.

Harris, who was given the Alexander Hamilton Medal for lifetime achievement in PR, said such a failure “is no longer unimaginable” and that most newspeople and “bloggers” appear ready to accept this happening. Said Harris: “For the last month or so, virtually every newspaper in America, as well as countless TV commentators and bloggers, have weighed in on whether the U.S. auto industry in general and GM in particular, are worth saving and deserve federal assistance. And for most of them, the answer is ‘no.’”

(Continued on page 7)

GAO SETS U.S. IMAGE AS PRIORITY

The Government Accountability Office has tabbed public diplomacy and improving the U.S. image abroad among the 13 most urgent issues for President-elect Barack Obama and the upcoming 111th Congress.

Public diplomacy shares billing with critical issues like defense spending, food safety, and financial market oversight in the list of priorities released to the press on Nov. 6 by acting Comptroller General Gene Dodaro.

“It is critical that the U.S. develop a government-wide communication strategy to address negative views held of us overseas,” said Jacquelyn Williams-Bridgers, managing director of international affairs and trade at the GAO. “Moreover, the U.S. must determine whether its investments, program priorities and disparate collection of broadcast agencies maximize our goal to promote democratic values and principles.

The GAO notes three critical points for policy makers to improve PD efforts. They include improving strategic planning, coordination and performance measurement; enhancing the substance and sharing of government audience research efforts, and addressing staffing challenges like language capabilities that arise from development of an overseas workforce.

President Bush in June 2007 issued the “U.S. National Strategy for Public Diplomacy and Strategic Communication” after the GAO recommended in 2003 that the federal government develop an interagency strategy for public diplomacy. The GAO said last week that gaps in research data, foreign language capability, staffing and resources hinder the ability of the U.S. to best target and communicate with foreign audiences.

Congress appropriated nearly $1.5 billion for the 2006 fiscal year for PD efforts by the State Dept. and Broadcasting Board of Governors. Those entities are bolstered by millions in strategic communications spending by the Dept. of Defense, USAID and the intelligence community.

BGR REACHES OUT TO DEMOCRATS

BGR Holding, the former Barbour Griffith & Rogers, has acquired Westin Rinehart in an effort to bolster its Democratic outreach.

WR specializes in media relations, advocacy, government affairs, image and brand marketing.

Founder Morris Reid was a key aide to the late Commerce Secretary Ron Brown and ex-Housing Secretary Andrew Cuomo. WR president Alexander Cochran also worked for Brown and Cuomo.

Ed Rogers, chairman of BGR and alumnus of the Reagan and Bush I White Houses, called the acquisition “one of the most important milestones in the firm’s 18-year history.”

Michael Meehan is the lead Democrat at BGR. He is former chief of staff to Sen. Maria Cantwell (Wash.) and communications advisor to John Kerry’s presidential run.

Meehan also was VP strategy & politics at NARAL Prochoice America and served as communications aide to former Senate Majority Leader Tom Daschle.

Meehan, who heads BGR’s PR unit, believes the WR acquisition reflects the “evolving political realities in Washington.”

CHICAGO PR PACTS FROZEN

Chicago Mayor Richard Daley has frozen spending on outside PR firms after criticism that followed a Chicago Tribune report in October highlighting city PR spending of nearly $5M a year.

Daley defended the PR contracts after the initial report but his office said on Nov. 4 that payments on 10 new contracts (worth up to $5M each over time) would cease until the city’s budget crunch is over.

The Tribune reported that MK Communications, the firm of PR pro Marilyn Katz, a Democrat and supporter of Daley, is a key PR contractor for the city. Her firm has reaped more than $4M since 2004, according to the paper.

Other firms that recently received contracts include Jasculca/Terman and Associates and Carolyn Grisko & Associates, the latter headed by a former Daley press secretary and campaign manager.

The Chicago Sun-Times reported Nov. 4 that Valerie Denney Communications, Better World Advertising and Metropolitan Group were also among the 10 firms given new pacts.

FLORIDA NARROWS FIELD FOR ID CAMPAIGN

Three Florida firms are finalists to guide a statewide public information campaign on new federal rules for obtaining ID cards.

Kidd PR (Tallahassee), Salter Mitchell (Tallahassee) and MRD Consulting (Coral Gables) are finalists for the $200K/year assignment.

N-tersections Communications Group (Tallahassee) and Evok Advertising (Sanford) pitched in the first round but did not advance.

Florida wants a firm to develop a PR, PSA, events and sponsorship campaign to educate citizens on the federal REAL ID campaign which was signed into law in 2005. The Sunshine State is phasing out its “Florida only” driver’s licenses and stopped issuing indefinite ID cards to seniors last month.

A decision on a firm is expected by the end of the month.

OC WANTS PR FIRM

Orange County’s Transportation Authority is reviewing its $100K account for on-call PR services with an RFP through mid-November.

The select firm will work with the OCTA’s public communications department on various forms of public outreach, as well as traditional and new media PR tactics. Much of the work relates to the county’s so-called Renewed Measure M, an extension of a 1990 half-cent tax hike devoted to transit projects for the county of three million people.

Proposals are due Nov. 19. A pre-proposal conference was held Nov. 6 in Orange, Calif.

OCTA’s communications staff won a Silver Anvil earlier this year for its work during a 10-day bus strike which affected 200K bus commuters.

Sacramento public affairs firm Townsend, Raimundo, Besler & Usher has worked with OCTA in the past.

The RFP can be accessed online at
https://www.octa.net/cammnet/procurement.asp.

NYC PLOTS FUTURE OF MEDIA

New York City has issued an RFP for a consultant to plot ways to bolster the battered media business, which pumps $15B into its economy.

Its Economic Development Corp. “seeks to understand how the city and the private sector can work together to maintain NYC’s position as the leading center of the media industry as the sector goes through the dramatic transition to digital production and distribution.”

It wants to “identify key drivers of change and uncertainty in the industry and describe three-to-five challenging and interesting scenarios of how the future might unfold.”

The EDC will “use these scenarios to devise actionable strategies for policy makers and industry leaders to steer NYC and its major stakeholders toward more attractive outcomes.”

The consultant will conduct research, run workshops and issue a “final report on the findings and recommendations of the scenario series.”

The RFP is online at www.nycedc.com. Submissions are due Nov. 18.

E.W. SCRIPPS SWINGS TO LOSS

E.W. Scripps posted a third-quarter net loss of $16M, a swing into the red compared with Q3 of 2007, when it reported a profit of $88.4M.

The company said it suspended its dividend and will cut 400 newspaper jobs for a savings of $15M a year.

Scripps, which publishes local and regional newspapers like the Rocky Mountain News and Naples (Fla.) Daily News and owns several TV properties across the U.S., said it notified staffers of the cuts on Nov. 5.

"Our publishers were careful to maintain our commitment to a strong local news product, and they retain the ability to fully serve the needs of our advertisers," said Rich Boehne, president and CEO of Scripps.

Newspaper advertising revenue was down 20 percent to $101M.

That includes a 28 percent decline in classifieds, its largest ad segment at $33.6M, a 31 percent decline in national ads and a 12 percent slip online.

Scripps said the employee headcount at its wholly owned papers has declined by more than 625 staffers since 2006. It expects to employ fewer than 4,000 by the end of the year.

In TV, political advertising provided a boost and the company posted TV revenue of nearly $80M for the quarter, up five percent from 2007.

Political ads garnered $10.3M for Q3, compared with only $700K in 2007.

SUN-TIMES POSTS LOSS

Sun-Times Media Group reported a net loss of $168.8M for the third quarter on Nov. 6, down from a $192.4M loss for Q3 of ’07.

An 18 percent decline in advertising revenue and two percent slip in circulation over last year contributed to the loss, STMG said.

The company posted an operating loss of $227.8M for Q3, much of it from a nearly $210M non-cash charge for goodwill and other intangible assets.

STMG said that charge came from the “substantial acceleration” in revenue for the quarter both in the industry and for the company, in combination with the negative outlook for the U.S. economy and the continued decline in its market capitalization.

Chicago Sun-Times daily circulation declined 3.9 percent for the quarter, narrower than the overall industry decline of 4.6 percent.

Sunday circulation, however, was up 4.5 percent year over year for the six months ended September 30, while the industry fell 4.8 percent.

Sun-Times News Group circulation overall was flat during the period, the company said, representing a slight decrease year over year.

USN&WR GOES DIGITAL

U.S. News & World Report, which went from a weekly to biweekly publication earlier this year, is now going digital.

A memo from president Bill Holiber and editor Brian Kelly says the goal is to “become a multi-platform digital publisher of news you can use and analysis.”
USN&WR is to focus on “dedicated teams” of nation & world, opinion, health, money & business, education and rankings & reviews.

Tim Smart, executive editor, is in charge of money & business, health and education, while Margi Mannix, executive editor, handles nation/world and opinion.

The restructured operation “addresses the needs of today’s consumers by offering them contextually relevant, exclusive journalism and other content, as well as advertisers by providing them with highly customized marketing solutions, according to the memo, which tells staffers to “say good-bye to Web 2.0 and welcome to Journalism 5.0.”

USN&WR will publish a monthly print edition that features its various guides and rankings.

OCR MAKES MORE CUTS

The Orange County Register has cut about 110 staffers in an effort to adjust the newspaper’s business that has been hammered by unemployment, loss of classified advertising and increased competition from the web.

Publisher Terry Horne says the paper will zero in on Orange County, providing readers information they can’t get any place else.

The layoff is the fourth round of cuts this year. Horne says the goal is not just to improve profitability but to become a “different kind of company.”

AW SCALES BACK; CRAIN BUYS SIA

Consumer magazine AutoWeek said it is returning to its roots as a twice-a-month title scaling back from its weekly distribution starting with the Jan. 5 issue.

AW, which is owned by Crain Communications and targets auto enthusiasts, began as a twice-monthly motorsports newsletter in 1958 and later increased distribution to a weekly schedule.

(Media news continued on next page)

The publication said the fortnightly issues will increase in size and digital coverage, including breaking news and videos, will be increased.

AW claims three million readers.

Crain also said last week that it acquired privately-held Staffing Industry Analysts, Inc., which provides research and analysis on the contingent workforce. Rance Crain, president of CC, said the company is broadening its portfolio of media assets.

HAYES JOINS CNN

Stephen Hayes, senior writer at The Weekly Standard, has joined CNN as a political contributor.

The author of “Cheney: The Untold Story of America’s Most Powerful and Controversial Vice President,” has also written for the Wall Street Journal, Los Angeles Times, Reason and National Review.

Prior to joining TWS, Hayes was senior writer for National Journal’s Hotline site. He spent six years as director of the Institute of Political Journalism at Georgetown University.

COX PARES 460

Cox Communications, which owns the No. 3 cable TV company, is cutting 460 jobs (two percent of its workforce) mostly via attrition and retirements.

David Grabert told the Atlanta Journal-Constitution, a Cox property, that there could be a “small number of involuntary actions, but things have not happened yet, and we are very early in the process.”

CC, according to Grabert, wants to bolster efficiencies and position for future growth.

DOSSETT TAKES YAHOO POST

Jeff Dossett, a Microsoft veteran, has joined Yahoo as senior VP-U.S. audience to oversee its media properties. He replaces Scott Moore and reports to Hilary Schneider, executive VP of Yahoo U.S.

Dossett was executive producer and GM of MSN Media Network, responsible for overall programming in the U.S.

He joined MSN in 2000, and served as chairman of both MSN Carpoint and MSN DealerPoint and GM of MSN HomeAdvisor.

In '02, Dossett took a two-year leave to climb the highest mountain of each of the seven continents. He is the second Canadian to scale Mount Everest twice.

FLORIDA CO. HITS TV PROBE

Global Funding LLC, a leasing company being probed by the Florida Attorney General, has brought in a PR firm as it copes with the aftermath of a TV news investigation and other scrutiny.

Glenn Selig, a veteran TV reporter who runs The Publicity Agency in Odessa, Fla., told O’Dwyer’s he is handling media, requests for information about GF, and helping company principals “understand and navigate the media scrutiny.”

Selig last week helped his client blast a WFLA-Channel 8 report about GF that interviewed disgruntled customers of the commercial equipment leasing company. He distributed to the press a letter from GF executive Jeffrey Maricle to the station that said the news report “vilified my company and me by blatantly discarding key pieces of information we supplied” as part of an effort “to make me and my company look bad.”

GF has shut down as its credit dried up after news of the AG probe and suits by customers spread.

Maricle said he is considering legal action against the station.

F-H HANDLES CORPSE MIX-UP

Fleishman-Hillard is repping Ballwin, Mo.-based Schrader Funeral Home, which mixed-up two corpses and mistakenly buried an 80-year-old man under another name.

The St. Louis Post Dispatch ran the item Nov. 1, the day after Halloween. The P-D told how the body of war hero Fritz Schnabel was buried as Robert Leonard.

Mourners at the 87-year-old’s wake hadn’t seen “Uncle Bob” for years, and assumed his appearance had changed during the final years of his life.

Schrader’s buried him Sept. 25 in his blue suit and Coast Guard hat so “there were things that matched,” recalled Christal Ferlis.

“That’s not my Fritz,” said Schnabel’s widow when she first looked into the casket on Sept. 28. “We thought we were in the wrong room, but he had Fritz’s clothes on,” said Schnabel’s son-in-law, Chuck Schreiber, one of the 15 relatives who viewed the body an hour before mourners were scheduled to arrive.

Funeral home staffers recommended that the family proceed with the funeral. It did without a body in the flag-draped casket. Schreiber would not comment on the switcheroo. It referred the PD to F-H for comment.

Dan Callahan of F-H said Schrader “deeply regrets the extraordinary mistake,” but added that it was the “first of its kind in the funeral home’s 140-year history.”

Briefs ____________________________

HarperCollins Publishers and the Wall Street Journal, both owned by News Corp., said they have formed a three-year publishing partnership to develop books written by the Journal’s editors and reporters.

The first book to be published under the agreement will be “The Wall Street Journal Guide to the End of Wall Street As We Know It: What You Need to Know About the Greatest Financial Crisis of Our Time – And How to Survive It,” by Dave Kansas. The book is slated to be published by Collins Business in January 2009. “The Wall Street Journal Guide to Management” is up next with a publishing date of early 2010.

Helium.com, a citizen journalism site, said it closed a Series-A round of funding with more than $17M from a global group of investors led by Signature Capital LLC and including Northport Private Equity.

Eric Reed, General Partner at Northport Private Equity, said the driving factor behind NPE’s investment is its belief that Helium has created a technology platform that “will be transformative to the world of authored and published material, allowing for the lowest-cost creation of the highest quality content.”

The Institute for PR dinner last week had two of the newsiest speakers in its history—Martin Sorrell of WPP, whose stock has been battered to less than half its recent value, and Steve Harris, PR head of General Motors, which the same day was in Washington, D.C., pleading for billions from the U.S. government to save it from bankruptcy.

Sorrell spoke for 50 minutes but allowed no questions. General Motors PR head Steve Harris attended via a pre-recorded videotape so no questions were possible.

His message of fear of a GM bankruptcy was a riff on the famous statement of GM CEO Charlie Wilson to Congress in 1953 that "what is good for the country is good for GM and vice versa."

Sorrell praised the interactive nature of the web and said this was made to order for PR. He had a chance to demonstrate interactivity with an audience but did not do so. Sorrell and Harris used the Institute as a platform to deliver their "messages." It was advertising rather than PR.

Sorrell was there to paint a glowing picture of prospects for his PR firms which do about $1.2 billion. He has been saying the ad business is in for a rough 2009.

It was ironic that Sorrell should be addressing the high temple of PR research when he, CEO John Wren of Omnicom, and the heads of the other ad conglomerates have for seven years blocked the release of revenue or employment totals for their thousands of ad/pr agencies.

This has removed an immense amount of data needed for research on these firms.

The reason given–Sarbanes-Oxley–is no reason at all. Release of employment and payroll totals would not violate anything in SOX, it has been argued by Tim Dyson, CEO of publicly-held NextFifteen, which releases figures for its Text 100 PR unit.

Publicly-held Cossette of Canada releases figures for its PainePR unit of the U.S. Canada has its own “SOX” law.

CPAs say that employment and payroll totals are “mere compilations” and not subject to differing interpretations. Therefore, they fall outside of Generally Accepted Accounting Principles. WPP cannot dialogue on this issue.

Besides withholding financial information, conglomerate-owned PR firms have reduced or eliminated client lists. Hill & Knowlton, a WPP agency, has not been allowed to provide an account list for about 15 years. Previously, it published a list of nearly 500 clients.

Sorrell swept through the IPR dinner like a freight train.

The usual one-hour cocktail party was declared over at 6:30 because Sorrell had to leave at 7:45. We?re quite familiar with what we call “bum’s rush” PR (“Oooh, I?m soooo busy and can?t possibly deal with you”).

He skipped not only the cocktail party but the dinner and the chance to have conversations with some of the more than 200 people present. His speech, however, said that is exactly what PR pros and even execs must do in the new web world.

The wave of PR firm sell-outs is mostly past. Based on the macro statistics WPP and Omnicom provide about their PR holdings, many independent PR firms are growing at about three times the rate of the conglom PR units.

Providing documentation of their revenues and staff last year to the O?Dwyer Co. were 190 independents, a gain of 42. Twenty-one of the 50 largest firms had revenue gains of more than 20%. A total of 618 specialty rankings (healthcare, tech, etc.), was provided, up 30% from 479.

Regrettably, the conglom PR firms have missed this boat.

Although Sorrell said “social media” are just made for PR people because they are used to interaction and “nuanced” communication, we think this falls under the remark that CBS commentator Andrew Cohen made about PR earlier this year—that what PR people do is try to convince others that “a turkey is really an eagle.”

PR pros today are confronted not only with out-of-control reporters, experts media quote, and organized pressure groups, but millions of citizens including their own employees who don?t hesitate to take a bite out of an organization?s hide.

Furthermore, PR pros today are not allowed to circulate freely among reporters and build relationships like they once did. Organizations decided decades ago that PR/press fraternization was a threat to corporate secrets. Having friends in the press today can be career-threatening for a PR pro.

Our favorite passage in the Sorrell speech (full text is on odwyerpr.com and instituteforpr.org) is where he describes PR?s role in the “turf wars” that take place in clients.

These are internal political “battles” for control of an organization. “Sometimes, if customers saw what went on within a company they would be horrified,” Sorrell told the IPR dinner.

“You could argue that most of the communication we coordinate for our clients is aimed at internal audiences rather than external ones,” said Sorrell.

“To express it a little more brutally,” he said, “probably the biggest block to progress for our clients is internal politics.”

So, PR people, besides being communicators, must be politicians. They must get on what will be the “winning side” or they will be out of jobs.

Harris became the first person ever to win the IPR’s Alexander Hamilton Medal and not show up to get it.

General Motors, as we all know, is in dire straits.

But we think Harris could have taken a few hours to come to New York and accept the award and answer some questions.

He would have had to act like Sorrell–no mixing with the cocktail hour crowd, no dinner with attendees, no questions, and a quick exit.

The behavior of these two executives provided a lesson in today's PR. One slip of the tongue by Harris might have made its way into the press and jeopardized the delicate negotiations going on in D.C.

PR people once said information was the “most precious commodity.” It is now also “the most dangerous commodity.”

The part of Harris' speech that intrigued us was the fact that he was disturbed by something a student said to him at the PR Society conference in Detroit last month.

The student asked Harris if working in PR “is an honorable thing to do and if PR is an honorable profession?”

“Wow! That really set me back,” Harris told the IPR dinner. He answered the student by saying, “What makes anything honorable is the person and how they conduct themselves, their ethics, their morals, and their integrity. Any profession can be honorable or dishonorable–it really depends on the individual.”

Harris further said the PR industry can do its “most honorable, our most noble work ever” by helping their companies in the “current global economic crisis.”

Our opinion: PR is honorable when it interfaces with experts in the press or experts employed or used by the press. Dodging the press and experts is dishonorable.

--Jack O'Dwyer