Wikipedia Scanner designed to create PR nightmares

Last night on NPR's Future Tense they interviewed, Virgil Griffith, the creator of WikiScanner, a tool that shows who made what edits to entries in Wikipedia. When asked why he created it he said he did it to create PR nightmares for companies that were using wikipedia as a disinformation tool. Indeed on his own blog he says he created the tool to: "To create a fireworks display of public relations disasters for all the world to sit back, and enjoy." This is a man who is clearly annoyed to see that some companies are attempting to hide behind the anymous posting policy on wikipedia and distort entries relating to their business. An example he used in the interview was of soft drinks manufacturers removing mentions that these drinks were harmful to your health. I think it's great that he has created this tool as I think it will help clean up wikipedia. Having lived through the nightmare of getting my own business listed on wikipedia I do worry that it will make people less likely to contribute though. When I listed Next Fifteen it created a host of comments about my independence and therefore the entry's credibility. In truth I never tried to hide my identity and the edits I made were to make sure it was factually accurate and that it met the criteria the 'wiki police', as I call them, were telling me the piece had to meet.

I have to say though that if wikipedia has been so abused by big companies, I am surprised that a 'PR firestorm' or two hasn't already started. Or is it simply that nobody has yet really used the tool in anger? Either way I guess from here on in PROs had better be aware that their entries are being watched. Of course I guess they could always make entries using a computer at an internet cafe given the tool relies on the IP address of the computer making the entry. No PRO is clever enough to do that of course.

What is wrong with books?

The Associateed Press released a AP-Ipsos Poll yesterday that shows that one in four Americans didn't read a single book last year. Nont one. Not even a Harry Potter book. Curiously, book sales are flat despite the fact that the AP-Ipsos Poll suggests that more and more Americans are finding other ways of spending their time reading books. This suggests that the ones that are reading are actually reading more books. Also shown in the poll is a bunch of data that you would likely expect. Out of Women that read they tend to average nine books a year versus men who read a mere five (it doesn't say who reads the more interesting stuff ;). So it would seem that we now need to add the death of the traditional book to the slow painful death of the newspaper...

If you want to read the details of the Poll click the link below. It has all sorts of interesting facts. For example of the books that were read the most popular were the Bible and other religious texts at 64%, whereas business books got a mere 4%.

http://www.ipsos-na.com/news/client/act_dsp_pdf.cfm?name=mr070821-4topline.pdf&id=3613

Clean conscience

Like many people in California I drive to and from work. In truth there is little choice unless you want to embark on a public transport system that would take twice the time and cost pretty much the same amount. I am due to change my car in a few months and have been getting my mind around the idea of buying a Toyota Prius. For the record I can’t say I like these cars very much. I fall in to the group that thinks they are relatively ugly. However, as someone that believes we need to do our part for the environment, a Prius seems the best bet. That said, when you look at the cost of a Prius, which is after all a pretty basic car, you realize that you are paying about a $10,000 premium to drive a car that is more eco friendly. As someone who typically owns a car for about three years that isn’t too bad when spread over the cars life - or is it? I’ve been looking at TerraPass.com which, like CarbonNeutral.com in the UK, gives you a chance to buy carbon credits for all the nasty emissions your life produces. For example, you can pay about $200 and that will apparently make your home carbon neutral for a year, a similar sum would handle emissions from most people’s annual air travel. When it comes to cars the TerraPass site estimated the cost of clearing out my emissions to be $50 a year for my current vehicle or $30 a year for a Prius. You can see where this is going can’t you? So for $150 I could make up for my car’s emissions during its time in my hands. Put another way if I bought a slightly more attractive car that actually cost less than the Prius but wasn’t as eco friendly I could use the saving to buy a massive amount of carbon credits. Indeed I’d likely have enough credits for all the people that read this article. So what do I do? Should I buy the Prius and feel good about it’s eco stats or get something cheaper and buy each of you a carbon credit?

Cutting the wires

Last month Sun Microsystems announced the beginning of the end for the wire services by saying that they would use the Internet as their primary distribution channel for important news, with the wires carrying the news 15 minutes later. Their first major announcement to be handled this way was their quarterly earnings and it seems to have gone without a hitch. I can only guess how many other Fortune 500 companies are watching to see how this switch goes so that in time they can end the somewhat old fashioned notion of using a wire service to distribute news. In the age of the Internet and RSS feeds it does seem very strange to rely on a wire service but on closer examination there is an argument, albeit a rather flimsy one, to keep the wires in place, at least for now. The argument as I see it is simple - the Internet can be unreliable and isn't necessarily controlled by the person either sending or receiving information. This means messages can get hacked, blocked etc and who is then responsible? Add to this the fact that we know that some companies have CEOs that are prepared to do things that are less than 100% legal (witness the stock option back dating mess) and you realize that it would not be hard to conjure up the situation where company A's earnings release is blocked by company B's hired hackers. So while I for one fully expect the Internet to replace the wire services, I also suspect that the wires will continue to stay in business until such time that such issues can be fully overcome.

Has MySpace died and will the WSJ follow?

Pre Murdoch I heard about MySpace every week if not day in one way or another. Since Murdoch bought it, the military has banned its use by soldiers and Facebook has arrived as the latest 'thing' in social media. This makes we wonder about a couple of things:

1) Are social media sites a bit like search engines were back in the old days - destined to be superseded until somebody invents the Google equivalent?

2) Will Murdoch's acquisition of the WSJ be a good thing? The apparent disappearance of MySpace is of course a PR problem. MySpace is still huge and getting bigger by all counts. It simply doesn't get the buzz that Facebook currently enjoys. While I'd argue that Murdoch still doesn't seem to know what do to with MySpace, it would be hard to argue that he'll have the same challenge with the WSJ. He understands the newspaper business and will presumably leave the news side of the publication well alone. He may well change the right wing tone of the editorials but even that is debatable. He does have a challenge on his hands though. He has bought a publication, that like most other newspapers, is losing readers on a daily basis. Sure, they are acquiring some online readers but the overall picture isn't a good one. At a certain level he will be forced to make some changes at some point, if only to make sure he can continue to generate reasonable returns. I guess the question is how long will he wait before he acts and how will he go about it?

Boeing, Boeing Gone

Boeing recently launched the 787 a totally new type of commercial airliner. It seems to be a huge success with 677 orders already on the books. Despite this rather long waiting list they today placed a full page color ad in the Wall Street Journal on the back of the first section. This seems an odd move to me. Looking at the ad I can't help but feel that the real reason they ran it was that in all the press coverage they got about the launch of the plane, few, if any, mentioned that it was launched on 7/8/07 (get it?). Indeed the whole purpose of the ad seems to be to point out that they launched the plane on that date, which is now 10 days ago. I guess with 677 orders they can afford to waste moeny on ads that simply point out an aspect of their marketing program that is now out of date...

Facebook offers cheap polls

If you want to do a quick and cheap poll to see what 200 people think about something, you can add a tool, imaginatively called Polls to your Facebook page which allows you to ask some multiple choice questions, each of which will get up to 200 responses and each of which will cost up to $51. You can select age groups for your poll and to some degree demographics. It's hardly the most advanced tool in the world but it's pretty good. I just put out the question: "who does the best PR?" offering Cisco, Dell, Apple, Microsoft and Google as possible answers. On the day that Apple is launching the iPhone it is perhaps not surprising that Apple is so far in the lead with 38% of the vote. Dell is currently last with 0%. The tool is hardly perfect - in fact I tried to offer IBM as a potential answer in my poll and it said this answer had too many capitals, so I chose Dell rather than write ibm. Anyway - this maybe useful for PR folk out there doing pitches or when they want to give a client a more calibrated view on a subject.

More bad news for advertising

The FT has just posted this article. Hot on the heels of the ban on billboards in Beijing come these moves in the UK.

Spread the word about the benefits of advertising
By Jamie Whyte
Published: June 26 2007 18:31 Last updated: June 26 2007 18:31
Advertising is unpopular with those concerned for our welfare. They see it as a kind of  coercion, making us “want things we do not really need” and, sometimes, things that are positively bad for us. Ban the ad, they demand.
Modern regulators are happy to oblige them. On Sunday, two moves to tighten up on advertising junk food to children come into force in the UK. Ofcom, the media regulator, introduces new content rules (including banning the use of celebrities), prior to banning advertising of foods high in fat, sugar or salt during television programmes popular with under-16-year-olds next January. The Committee of Advertising Practice, an industry group, is bringing in similar content rules for press, posters and paid-for internet space.

Beijing Bans Billboards

Jason Leow of the WSJ wrote yesterday about the removal of 90+ billboards on China's Golden Avenue in a bid by the city sanitize the city's image. He reports that the crackdown appeared to start on the advertising of luxury homes. Now, he went on, as a part of a massive urban reorganization exercise the advertising ban has been extended across much of Beijing.

This is reminiscent of a similar move in New Delhi a few years ago where thousands of illegal billboards were removed so you could actually see the city. At the time there wasn't actually that much to see but a lot has changed since and presumably the city planners in Beijing expect their city to continue to evolve and would prefer that billboard proliferation not be a part of the outlook.

This of course poses a huge headache for brands that relied on these billboards to get their messages across, however unsubtly. So as the city tries to prevent itself from being one giant Times Square or Piccadilly Circus it will be interesting to see where those ad dollars go that would have promoted all those luxury cars and condos. I suspect the ad agencies will have some ideas on how to spend the money but maybe some PR execs should be putting their thinking caps on too.

Apple's $3Bn Battery

Apple's market capitalization increased $3Bn today on the news that it had improved the battery life of its soon to be launched iPhone. They also said the screen would be glass rather than plastic. My assumption is that the latter didn't affect the stock as much as the former. Either way it seems that investors are betting big time on the iPhone and assume that any small improvement will have a big impact on sales. That said, today's rise in Apple's value is stunning. If you assume that all the people who will now buy the iPhone because its battery life is a bit longer buy the more expensive model then to generate $3Bn in additional value in one year you would need to sell an ADDITIONAL 400,000 phones by my calculations (I've made some basic assumptions on how much after tax is earned from each phone sold). That's about a 1000 EXTRA phones (that cost $699) a day just to support today's rise in stock value. Of course it could be that the market is only just getting its head around the fact that Apple is going to be a big player in the phone market alongside Motorola and Nokia. But remind me, how may phones a day do they sell that cost $699?

Microsoft spell checker

Ever noticed that the spell checker in Microsoft Word knows names like IBM, Hewlett Packard, Toshiba and Sony but struggles with Google, Facebook and MySpace? Makes Word look like the parent that can't quite speak like a teenager. Funny though that the spell checker in Google's blogger doesn't question any of the names...

Notable PR blogger seeks job

Seems a notable PR blogger that writes under a nom de plume in the US is looking for a job in Europe. They're presumably hoping to cash in on their social media prowess by helping beef up the skills of the firms over there. There is a challenge with this though. Good PR blogs, like many good industry blogs, are irreverent and tend to poke agencies in the eye when they do or say something stupid. In truth they poke at agencies most of the time, whether or not they've been stupid because that's what make them an interesting read. In other words, the very skill that makes them good at their job as a blogger makes them harder to hire in the industry they watch. After all, if you are agency X and have been roasted by a blog for the way you handled something, are you likely to want to hire the blogger? The answer is going to be no in most cases as quite simply most agencies would struggle to admit that the blogger was 100% correct. That's because they weren't 100% right... 85% maybe but not 100%. This is of course a shame but it's human nature even for thick skinned PR folk. Of course I'm not suggesting that bloggers soften their style so they can get agency jobs. It would be a shame to lose the edge that these blogs have developed just so the poeple writing them find it easier to get a job in PR. Instead it probably calls for these blogs to be prepared to be a little more willing to listen and for the agencies to accept they're not perfect.

Google is hiring for PR

Word on the street is that Google is looking to hire some 70 PR people at its head office in Mountain View in the near future. If true this could have quite an impact on the tech PR industry. At its simplest level it will tighten an already tight labor market and potentially drive up salaries as people try and compete with the search engine giant. Nobody would argue that Google has built an impressive brand in recent years but there are a couple of questions that I’d put out there. First, why is Google doing this now? Is it because they believe they are starting to see sentiment move against them much as it did with Microsoft when they became wildly successful? If so, then being a PR person at Google may be a less enjoyable task than in the last few years where editors have eaten up every news story, no matter how trivial. The second question is what has happened to Google’s stock? Last year the stock soared and then… soared. This year it spent most of January around $500 and has since drifted off to around $475. Could it be the new army of PR people is being brought on board to try and get the stock price moving again by airing more positive stories about the business? It’s worth considering that Google has historically been able to attract some pretty hot talent thanks to its soaring stock price. I wonder if the relatively poor performance this year is starting to hurt these hiring efforts…

eBay as a market research tool

I was reading a blog entry the other day that asked what had happened to the Microsoft Zune, the much touted rival to the iPod. Given the money Microsoft spent promoting the product it is a good question to ask. One way I sought an answer was to look on eBay and see what price these were now selling for. In essence I wanted to see if there was a big market for them and also what had happened to prices. It then occurred to me that eBay in effect offers a great tool for people wanting to track the life cycle of a consumer product. You can pretty easily take off the current pricing of products (highest and lowest) and also the volume available on a daily basis and thus plot the rise and fall of these products over time. This is the sort of data that usually required expensive research. Thanks to eBay it is essentially free if you can get someone to pull the data, or if you create a tool that automatically takes off the data. In the case of the Zune it did sell at a small premium to start with and can now be bought for around $180, which is about a 28% discount. Taking my theory another step I'm pretty sure you could use this kind of data to predict when you need to release a new version of a product in order to prevent the sales price sliding too far. Of course you could also use it to predict when your competitor should be releasing a new product.

Reuters creates a target for PROs

A couple of days ago Reuters made an announcement that appears to have been ignored by the PR industry. Essentially they announced the introduction of technology that would scan news for sentiment on particular companies and issues. If, as a result of these news scans, sentiment went above or below user defined limits, then an automatic trade would be executed. It's another form of algorithmic trading and will likely become a key target for PR consultants wanting to drive the price of a stock up or down. Presumably, if you know how to play the sentiment game, you will in effect be able to force your client's share price up and its competitor's down. A pretty scary thought but just as there are companies that have built a business optimizing sites for search engines, I suspect there will be people optimizing content for this Reuters technology.

http://about.reuters.com/productinfo/updates/update.aspx?user=1&id=1176&

Will a weak $ affect our industry?

My guess is that most people in the PR industry don't pay much attention to exchange rates, unless they do financial PR. This isn't intended to be a criticism. In most instances exchange rates don't make much difference to the day to day work carried out in our industry. However, the steady decline of the US dollar in the last few years ought sooner or later to have some impact. From where I sit I can see a few ways a weak dollar could impact agencies:

1. For agencies representing European firms a weak dollar may create an argument for higher spending. This argument is based on the fact that relative to the Euro or Sterling, marketing spends in the US are actually declining in real terms - of course so are sales which is of course the reason most budgets won't change. But for companies wanting to shift perceptions in a big way, now may be a good time for that promotional push in the US.

2. For agencies representing US businesses overseas it could be argued that budgets should also rise. I'll admit here and now that the logic trail is rather one sided but hear me out. Many US businesses are benefiting greatly from a weak dollar by becoming more competitive in overseas markets. Put another way they are deriving a greater percentage of their profits from overseas markets thanks in part to this improved competitiveness and in part to the translation effect of converting say sterling back in to dollars. This may in turn make it more attractive for them to up their marketing spends in these markets to improve sales even further.

3. US agencies looking to sell may find themselves more attractive to European buyers. The US agency market has been a difficult one to crack for many European agency groups. A weak dollar makes US agencies a relatively cheap deal right now - if of course you assume the US economy is going to continue to perform relatively well. Now there a number of UK agency Groups that could be potential buyers, these include: Chime, Huntsworth, Creston and of course Next Fifteen. The larger Groups such as WPP and Publicis are of course also an option. My guess is that the likes of Ad Media Partners are brushing up on their international dialing codes.

So while a weak dollar can be frustrating for someone like me that runs a UK-based PR Group, the news isn't all bad.

YouTube's Next Step?

If like me you occasionally poke around on YouTube for research reasons, you may have noticed an increasing number of videos of things that are for sale. This includes items like cars and houses. This of course makes complete sense as it becomes clear that if you want to buy a big ticket item it might be nice to have more than a few pictures, which is typical on eBay. It would seem logical therefore that Google, as the new owner of YouTube, may just look at adding an eCommerce engine to YouTube to enable people to actually buy the items shown on the videos. YouTube purists may say this will make it even harder to find good content but I suspect the guys in Mountain View could find a solution if the site really does fill up with sale items. Of course, the other alternative is that eBay adds YouTube like features to its site. Watch this space.

Technology PR or Energy PR?

In the last six months we have seen the environment come back on the agenda with a bang. This has caused almost every major company to look at its 'green quotient.' Now for some businesses this simply means making themselves carbon neutral but for others it means changing the products they sell and some cases rethinking the competition. Take companies such as Cisco and Polycom who both offer pretty sophisticated video conferencing solutions. Whereas these systems were at best hokey (and horribly expensive) a few years ago, they are fast becoming usable and affordable, thus causing the airlines to take note. Now if you had said a few years ago that United Airlines biggest competitor would be a technology company people would have patted you on the back and changed the subject. Of course just about every major tech company is now looking at its product set and asking: "can we make it use less energy?" or "will this solution save the customer some energy?" This is changing the very messaging of the major tech firms and many smaller ones, putting energy up near the top of the list. The other big shift has been the shifting interests of the major VCs towards clean tech investments. John Doerr and Vinod Kholsa in particular are making big steps in this direction with huge investments in areas like bio fuels. These people are of course expecting their marketing partners to make the same shift, meaning that PR businesses that were announcing servers and embedded chip controllers a few years ago are now discussing the merits producing ethanol from corn, versus sugar cane or even trees.

Now this could all just be a passing phase and as one senior PR executive said to me yesterday, the media is already getting a little tired of writing about how company x is going green. But what does appear to be clear is that the tech market and energy market are converging. So any self respecting PR executive that is currently making a living from tech PR had better start learning about the dynamics of the energy market, because in one way or another its going to affect them quite significantly in the years ahead.

Didn't we get a new Fed Reserve Chairman?

The Federal Reserve Chairman is Ben Bernanke. Yet it seems the former FRC, Alan Greenspan, seems to have either forgotten he retired, or was never told. In recent weeks he's spoken to the media a great deal with views on the likelihood of the US economy slipping into recession (he's gives it about a 30% chance in the next year) and his thoughts on the collapse in the subprime lending market. His comments are getting the attention of the media and the financial markets. Now of course it could be that he misses being in the spotlight and simply wants to see his picture in the papers, or it could be that the government finds it quite useful to have a credited but unofficial source giving people some guidance. If it's the latter, then he may prove quite an effective spokesperson for the current administration, assuming of course he keeps people feeling that things are going OK. Either way, I'm guessing that the government's PR machine is keeping a close on eye on his pronouncements and is likely ensuring he gets their side of the story.

http://news.yahoo.com/s/ap/20070315/ap_on_bi_ge/greenspan_2

The next big thing

Spent the last few days at TED, a pretty amazing event that feels a bit like a meal. Presentations from movie producers, software engineers, poets, physicists, Paul Simon and Bill Clinton. The reference to the meal being that some of this has been like 'having to eat your greens,' while other parts have been like being given a great dessert. If there's one theme that has pervaded the event so far it is again that we all need to work on saving the planet. This was very much the message of John Doerr who ended his speech in tears and has been a passing reference by almost all the other speakers. From a communications perspective it's hard not to walk away from this feeling that for brands to succeed they must put greater emphasis on this aspect of their social responsibility if they are to succeed. Of course you may argue that consumers are the ones that will be the judge of that. I'd argue, having been bathed in the 'we have to save the planet' message for a few days by leaders from all walks of life, that this is not a passing fad. equally it's a message that is getting the attention of some pretty important minds. Therefore I'd argue that what we have here is something really important. It's what VCs have been searching for since the dot com bubble burst. It is the next big thing. Kind of funny when you think about it. The next big thing isn't some amazing new algorithm or financial model, it's the thing you've been standing on for most of your life - the planet.

A Long Tale on the Value of Blogging

Excuse the pun but I recently came across a paper co-written by some IBM and Google researchers on the connection between blogging and the sales of products. The paper was written back in 2005 so is not new but it is one of only a few papers I've ever seen that have tried to draw a clear link between the impact of blogs on the sales of companies. The good news for bloggers is that there appears to be a connection. At least there was when it was written. While rather academic it is worth a read.

http://labs.rightnow.com/colloquium/papers/prediction_from_chatter.pdf

Google Toy Useful for PR

If you want to know whether Tony Blair has been in the news as much as George Bush, or Apple Computer versus WalMart then Google Trends can give you a pretty quick answer. For many PR execs wanting to know if their client is making as much noise as its rivals this tool will be very helpful - assuming their client is big enough to make a decent amount of noise. I recently saw this tool used to express a client's 'noise level' versus other big companies and while it doesn't allow you to dig very deep it is nevertheless useful. Right now most searches simply track the volume of searches for each item but for some the results also show News Reference Volume. For example, search Google versus YouTube and you will see what I mean. I can only assume that in time Google will make this technology more powerful and useful, much as they have with Google Maps. Watch out media measurement businesses, Google has come to town...

Oh and if you search on PR versus advertising, it looks like PR is slowly catching the old dog.
http://www.google.com/trends?q=advertising%2C+pr&ctab=0&geo=all&date=all

Council of PR survey says industry is booming again... especially for the small agencies

This survey interested me, mostly because the Council is usually a great mouthpiece for the bigger agencies in our industry. Yet the survey they released this week says that the real growth in the US agency business is set to come in the agencies below $4m in billings. These firms, the surveys says, are expecting to grow at nearly 20% this year, whereas average growth (presumably including the small high growth firms) is likely to be around 14%. If we take out the small firms that suggests the bigger firms are probably forecasting growth of around 10% which is still not bad. Now I know the law of big numbers would suggest that larger agencies may find it harder to grow at high rates but I wonder if this survey is telling us another story. In my mind there are several possibilities. First it could be that small agencies are soaking up the demand from all the small clients that big agencies don't want. This would make sense, especially if the economic data suggested it was the small businesses in America that are generating the real economic growth. But that last point doesn't seem entirely plausible given the numbers that have been put out by major energy, retail and tech companies lately. The second possibility is that clients are less excited by the big agencies. This seems possible but would not seems to match our Group's experience where the largest of our firms is seeing a very full new business pipeline. My last theory is that the market is simply very tight and this actually means that only those businesses that have people to do the work can get hired. The large agencies are quite happy to grow at a decent pace and hire accordingly. Smaller agencies are often happy to take the growth when it's there and given the labor laws in the US this means they can hire freely knowing that if things go against them they can relatively easily cut back, especially as smaller firms. Whatever, the real reason is it is great to see the industry so optimistic about its future.

what a difference this time around for Microsoft

In 1995 I remember being in a cab in New York and all the driver wanted to talk about was Windows 95. That same year I remember two mothers with their babies in a Starbucks discussing the merits of Windows versus the Mac OS. 1995 was a truly remarkable time in technology and a time when Microsoft truly broke through as a household name. It is interesting that twelve years on and with a huge marketing budget the launch of Vista has not quite captured the same level of attention even though there are billions of people who may be affected by it, compared with the mere hundred million or so back in '95. I know a lot of people will say this shows how Windows is no longer the driver of the tech industry. On that front I'd argue that Windows is still very much at the heart of IT. It's just not that new. Indeed Windows is technically nearly 22 years old now. It seems hard to imagine that some University graduates were born after Windows was first launched. If you think about Windows in this way you realize that the comms challenge with Windows is quite unique in technology terms. Indeed the challenge could be likened to that of an aging rock star that is trying to attract a new generation of admirers. It's a tough trick to pull off but some manage it and I for one wouldn't bet against Microsoft even if Vista hasn't got off to the high profile bang it did when it scored its big hit in '95.

YouTube and Saddam Hussein

I'm a big fan of YouTube. It's a wonderful piece of technology and a great invention. That said I'm very disappointed to see them carrying footage of the hanging of Saddam Hussein. At what point does YouTube grow a backbone? I know people want to see the footage and I know that if YouTube doesn't show it, they'll get it elsewhere but I don't think that should matter. YouTube should be prepared to set a standard. Right now they've sent a message to the world that says: "anything goes." I for one think that's very sad.

Bill Gates, where are you?

The search is on to find the next Bill Gates according to a poll carried out by 463 and pollsters Zogby. People polled believe the next Bill Gates has been born so I guess all that remains is to find them. That search is more likely to bear fruit if people look in China or Japan than it will if they look in the US according to the poll.

The poll also asks Americans if they are ready to switch to citizen journalism for their news and while the result was a negative on that, it did reveal that 25% of 18-49 year olds would pick Citizen video for their daily news. Given how new this space is, that's pretty amazing and should worry the major TV news networks.

The full poll can be found on 463's blog at: http://www.463.com/463zogby_poll.html

In 2006

1. Google stock went to $500 much to the delight of realtors in Santa Clara County
2. Dick Cheney accidentally shoots a friend in the face and moves into the background politically
3. Google buys YouTube for $1.65Bn
4. Microsoft founder Bill Gates announced his retirement from Microsoft an the stock goes up
5. Al Gore became a movie star and may have finally shifted American sentiment on environmental issues
6. Toyota starts to sell more cars than Ford (see number 5)
7. Donald Rumsfeld steps down after months of pressure
8. The DJIA reached a record high
9. Blog and wikis became mainstream and old media continued to decline
10. WSJ announced major redesign as readership drops (see number 9)
11. HP gives a lesson in how not to handle a boardroom crisis
12. Oil prices start and end the year roughly unchanged but in between boy did they go on a roller coaster ride

What's reality?

Lord Bell, Chairman of Chime is credited with the saying: “perception is reality.” I’m wondering if we now need to shift that to: “Google is reality.” I’m being a touch facetious here but I just had a call from someone who is trying to get a reference on a person who works for one of the large technology businesses (a very large one in fact). They had tried to look them up on Google and found nothing. What was interesting was their view was that if this person didn’t show up on Google they can’t be that important. It is worth noting they were doing the research for a friend so it could be they had their name spelled wrongly. I actually found myself feeling sorry for this person and have reached out to several other people to see if they know of anyone with a name like this that works at the unnamed company. I wonder at what point will people start to add Google search links routinely to their CVs/resumes? For the record this person probably isn't that important.

Customers and color

It seems that if you want customers to like your latest piece of consumer technology then you should paint it white. At least that seems to be the case with customers shopping at Circuit City for the new Microsoft Zune. I just did a search on this new product because I was curious to see how easy it was to get one. I own several iPods so I'm not likely to buy one. What stood out when the availability results came back on the Circuit City site was the customer ratings for this product varied by color. Highest was white with a rating of 4.8 out of 5, while brown scored only 4 out of 5. Black, meanwhile, did slightly better at 4.4. To reiterate the point, these are the SAME products in different colors, yet the rating varies quite considerably. For the record, I looked on the same site at iPod ratings, regardless of color the Nano scored 4.4. Am I the only one that thinks this is odd?


CLASS%20-%20GAMES&cm_ite=135146%20PURCHASED%20KEYWORD-ZUNE&cm_keycode=338347">http://www.circuitcity.com//ssm/MP3-Players-iPods/sem/rpsm/catOid/-12952/Ntk/All/Ntt/zune/rpem/ccd/categorylist.do?WT.mc_n=338347&WT.mc_t=U&cm_ven=PAID%20SEARCH&cm_cat=ADVERTISING.COM&cm_pla=CATEGORY%20-%20GAMES%20&%20TOYS->CLASS%20-%20GAMES&cm_ite=135146%20PURCHASED%20KEYWORD-ZUNE&cm_keycode=338347

The emotional side of PR

I found myself being a PR person’s nightmare this week. To put it another way, I found myself refusing to believe (or at least not wanting to believe) a news story even though it was being covered by a number of pretty credible news outlets such as the FT, WSJ and Economist. The story was about the US dollar’s rather precipitous drop against other leading currencies. Now I didn’t want to believe it for a few reasons. First, because I run a business that reports in sterling and a fall in the dollar is just downright annoying. That said we use various currency products from banks to mitigate that problem. The second reason, is that I live in the US and I didn’t like the assertion that the US economy was actually weaker than the European economies. In truth I’m still not sure I follow the logic used by the Economist on this story but that’s not really the point of the entry.

My point here is that if someone has both a rational (runs a business that can be technically affected by a change) and an emotional (lives in the country that is said to be doing poorly) reason not to want to believe a story, it can be awfully hard to change their opinion. The emotional reason is the toughest to shift just because it’s so… emotional. In this instance I want to believe in the American economy for a host of reasons, not least that I have kids and I want them to grow up somewhere where they’ll get a good education and rewarding career. If the US economy has the kind of cancer that the Economist argues, then I should move my kids to France tomorrow where they will at least get great schooling. See my point? It’s awfully easy to get drawn away from the story and in to your own world. This reminded me that for PR people trying to fight issues on behalf of their clients that a good consideration of the emotional impact of a story may well go a long way towards finding a solution.

To put this thought in to perspective, if I were the US government right now and I wanted to counter the arguments being made, I’d focus on the great talent this country is producing in all sorts of areas AND the talent this country still attracts. It is after all people that make up economies and with great people you can have great economies. And who are these great people that I refer to? Well my kids of course!

Is Big Tech Back?

If you told people Google’s stock price had risen 25% in the past quarter nobody would be that shocked. But if you told them pretty well all the major tech stocks had had equally good quarters it may take some believing. However, when I just checked, the facts are that the following stocks rose by the following percentages:

Dell 10% (yes Dell, the one that is said to be struggling to find new growth and with that annoying battery problem)
Microsoft 15% (the one that has been criticized for delays of Vista and whose Chairman retired)
IBM 20% (I can’t actually think of a reason why ITS stock would suffer – truly)
Intel 24% (the one that is being challenged by AMD)
Oracle 25% (the one that has run out of companies to buy)
HP 25% (the one with the dysfunctional board)
Apple 32% (hasn’t everyone bought an iPod by now?)
Cisco 34% (the company that was the dot com darling but pundits said had had its day – clearly wrong)

Indeed the NASDAQ Computer index is up 18% in the last quarter. That means if you’d invested in pretty well any tech stock you should have done pretty well in the last three months. Now I know, the tech industry has been producing some good numbers (Cisco certainly has) but in truth they’ve been producing good growth for a while. I wonder what made the markets wake up?

Blogs versus news

You may think I’m getting obsessed with Google News these days. I assure you I’m not but I did think it was quite revealing that when I searched on ‘Edelman Walmart blog’ I got twelve news responses. When I used the site to search for blogs with the same criteria I got 1,458 responses. That means for every news item there were over 120 blog mentions. Going back to my HP item the ratio was more like 1.5 blog mentions to each news item. I guess this shows how the blogging world works.

Has HP taken control?

It seems HP may finally have a handle on its pretexting crisis. A quick search on Google News shows there have only been twenty six news items in the last week. Given the pace that news was pouring out a few weeks ago (nine an hour) this is quite a change. It is worth noting that there hasn’t been another big tech story of similar importance, so one can only assume that either HP has managed to put a lid on things or the media (and public) has simply moved on.

Text 100 to tell the Truth

The inevitable truth that is. Today Text 100 is launching its Clean Tech Practice which will aim to help organizations in the areas of energy efficiency and renewable power. The team already has some good client experience with people like: PARC, Philips, GE Wind Energy, Altran, npower renewables, National Physical Laboratory (NPL), TOTAL, Envirowise and Whirlpool. I also note their release talks about how much VC spending is going into this scetor. There is no doubt that fear of global warming has put some heat (pardon the pun) into the sector...

Gootube?

So the Wall Street Journal piece today saying that Google is in talks to buy You Tube has understandably got quite a lot fo attention. A few things pop out here. First if You Tube does sell then Google really is the most logical buyer. Google's cutlure and business model is ideal. The other potential suitors seem less of a fit andf have already put forward alternatives. I'm referring to the likes of Microsoft and Yahoo!. I guess the question is will they sell? If you were a founder would you cash in now? The same questions were clearly in the minds of the Skype guys. In their case eBay paid $2.3Bn for the business. At that price I think it was likely an easy decision. You Tube is apparently being offered $1.6Bn. This seems relatively cheap to me (the emphasis being on the word 'relatively'). Truth is the numbers at this level are not tied to sales or profits they are tied to 'how much can you justify to investors.' It is very clear that You Tube is a high growth company in a high growth area. On that score if this deal were to open up a rapidly growing $10Bn market for Google then a price of between one and two billion dollars doesn't sound that bad. Does it?

HP crisis keeps on rolling

Two weeks ago I posted a piece on this corporate drama and of course today has been another eventful day what with the resignation of their General Counsel. Anyway when I wrote my last piece a Google News search on 'HP and pretexting' brought up around 4000 news hits. Two weeks later that number has jumped to just over 7000. That's an average of over 200 new stories a day or roughly 9 new stories per hour. HP will be relieved to know it still lags well behind the Iraq War which is generating 100s of posts an hour on a good (bad) day.

Content gets a longer tail

There has been quite a lively debate about the ‘Long Tail’ since Chris Anderson first wrote his article in Wired back in 2004. In today’s Wall Street Journal a couple of news items caught my eye that provide tools for content to wag their own long tail. And where there’s content there is usually something PR people should pay attention to. Specifically the news stories were: Cisco’s move to create a B2B video messaging service; and a piece by Lee Gomes that talked about how companies like LiveOffice are enabling people to store podcasts of just about any conference call they hold. In both these cases companies (well people actually) can find a permanent home for content that would ordinarily have died a death pretty quickly. This is potentially interesting for the PR industry in that it creates some further resources to help editors and analysts but also tools that can communicate directly with communities or individuals. No longer will people have to dig around in the store room for that old footage of their CEO talking about… whatever he was talking about, or the tape of their CFO explaining the way they are going to reorganize the business. Of course it also means that the opinions we put forward are going to be there for all to see and hear for many a year to come AND they'll be easy to find...but that’s no bad thing. Is it?

HP lurches from one crisis to the next

Like many PR people I've been wondering why the crisis gurus have not been able to get the HP board under control. Surely the board doesn't want the entire saga to be played out in the media? Right now though, every move of this mess seems to be getting air time in one media outlet or another (Google news has about 4000 news stories on the topic already). Having said that this seems to have been a recurring issue for HP - remember the whole Walter Hewlett saga?

Going back to the current problems, if the media circus continues and it shows no sign of stopping yet, then the very man that appears to have turned the business around (Mark Hurd) could be the one to pay the biggest price. Patricia Dunn meanwhile could end up with a cozy non-executive seat (I'm curious as to why she's being allowed to stay on btw).

I can't blame HP's internal team for this situation. Company boards are notoriously tough to deal with and will rarely take good counsel even when offered. That said, when matters escalate as they have here, they usually listen to some crisis management expert. For HP's sake I only hope someone is able to take control soon or the blood on the carpet may start to get thicker.

Financial Dynamics Takes a Different Path

The news that Financial Dynamics was being acquired was hardly the world's biggest surprise. Indeed there'd been speculation in the trade media about a deal for some time. What was unusual was the buyer: management consulting firm, FTI and of course that $260m price tag. This news should be welcomed by those in our sector as it shows other industries value the PR world. It also shows that the PR world isn't necessarily destined to be owned by WPP et al. Indeed the deal shows that there is an alternative out there to the 'integrated marketing' message being touted by the large agency groups. That alternative would seem to be based more on integrating a company's ability to reach specific communities – where communications is just a part of the process. At the heart of this new approach would seem to lay the need for 'focus' or specialization. Few would argue that FD was a pretty focused business and it would seem their skill in helping companies manage their profiles in financial circles is to be married to FTI's skill in helping firms solve commercial problems and set strategy. Combined they should be able to offer businesses a way to strategically review their business, undergo the changes that review proposes and manage the communication of that change to the world. Put another way what FTI gets through this deal is the chance to squeeze every last consulting dollar out of some pretty large engagements. It certainly has logic on its side. If they pull this off it could herald a new wave of M&A activity for the PR sector – presuming of course that agencies remain sector focused AND remain connected at the highest levels within their client base.

Best UK PR Consultancy to Work For?

The Holmes Report in the UK has just published its 'Best consultancy to work for' list. I have to congratulate Rainier PR for winning for the second year running. However, it does raise an interesting question: does this list actually mean anything? I ask this not be rude to the winners or to Paul Holmes but because none of the top twenty are the top agencies in the UK. Now if this list was a predictor of which agencies would become the top agencies then again I can see its value but it doesn't seem to play that role either. Of course it could be that it shows that if you want to work for a good employer or if you are a client that wants to hire an agency that treats its staff well then this list will act as a good guide. However, again this either shows that not many clients care about how staff are treated (or these agencies would be growing like crazy) OR that staff don't care how they are treated (or these agencies would have a waiting list for jobs). The one common link in the list would seem to be that the agencies listed are all small or medium sized firms. Either this means these types of firms are better places to work (seems logical) or the bigger firms just didn't engage. Of course it could be that these winning agencies are good at getting staff to say what great employers they are. Given two of my agencies (August.One and Bite which are both wonderful places to work!!) are in the top 20 I hope you see that I raise these questions out of genuine interest and not because 'we didn't win.'

Online news consumption is all about sports...

I hadn't looked at this in a while but Akamai has been tracking how many people access online news for some time now. It paints an interesting picture of online news consumption. For example the vast majority of the news hits are US driven. So much so that other regions don't really impact the end results. Sadly the vast majority of news this nation consumes seems to be sports related. Indeed out of the top ten news days they've recorded seven were sports related (the world cup being a huge factor it seems). The other three? Two were related to terrorism and the other to Katrina.

If you look a little closer you'll see that of the roughly 3m news hits today, 2.6m were in the US, 300K were in Europe and the remaining 100K were spread around the rest of the world. That seems amazing to me and perhaps explains why concerns about the death of print media don't seem to be taken as seriously outside the US. At first glance I wondered if the consumption outside the US were abnormally low today but the Akamai system actually shows whether this a high, normal or low news day and while it is a moderately high day in the US it is at worst normal in all the other regions.

I guess the end could really be in sight for print media at this rate. As long, that is, as they make sure they offer good sports news!

Link: http://www.akamai.com/en/html/industry/nui/news/index.html

Economist discusses death in the family

I need to thank Drew B for pointing to the Economist article on the death of newspapers. As ever the Economist does a good job of educating its readers on the big issues. I'd like to see this piece followed up on though as it really only serves as an introduction to the topic. Nevertheless it's worth a quick read.

http://www.economist.com/opinion/displaystory.cfm?story_id=7830218

Client conflict

I hear on rumor mill that the Council of PR is about to come out with a new statement on the thorny issue of handling client conflict. Like me, it seems some at the Council feel PR agencies are judged by inconsistent standards at best. Now it seems some agencies do a better job on conflict than others. Take Edelman who works with both Adobe and Microsoft. Indeed Edelman seems able to manage this level of conflict for a number of big brands. I take my hat off to them for their nerve and their ability to convince clients that these conflicts are OK. Indeed I write this not to be critical of Edelman's approach. Instead I just wish there were some clear standards on what was deemed an acceptable way of managing conflicting clients. Perhaps this is what the Council needs to work on? I think a strong statement on conflict is an excellent start but I'd also encourage them to develop (if they have not already) some clear guidelines on the ways conflict should be handled. This should extend to the construction of teams; the way information is received and stored and so on.

Of course if you look at the professional advisors used by most large firms such as law firms, accountancy practices, management consultancies etc they nearly all have conflicts. These firms don't have the same issues it seems. Is this because they are hired by different people in the business? Is it because they have a history of doing it? Is it because they are considered a profession? Whatever the answer it's clear that these advisors are held to a different standard. While that may be a touch frustrating for PR people, it's a fact and one we need to accept. However, it is also something we can do something about. As I say I'm pleased the Council of PR has taken up this issue. I only hope that the topic gets significant attention in the PR media and in other circles so that clients can be better educated on how conflict can be managed successfully.

What does the Pew Study really show?

I just read Nick Carr's blog on the state of Online News following the Pew Study that came out this week. To cut a fine story short he effectively says that while people have moved to getting their news online they are not necessarily:

a) consuming more news - indeed he suggests that the decline in traditional media consumption is being matched to a degree in the online world
b) about to kill off traditional media - his view from the Pew study is that while this media is declining it is more often than not read by those that consume online news. In other words it will only really die off if everyone stops reading news altogether which seems unlikely.

His piece ends by saying that: "The report is not good news for newspapers, but it does show that the reports of their imminent death have been exaggerated. The real division is not between the audience for online news and the audience for traditional news - they are the same audience. The real division is between the people who are interested in the news and the people who couldn't care less. In fact, it looks very much like online news media are now merging with traditional news media, as the two come together in a symbiotic relationship to serve the same set of customers. They are not competing with each other so much as they are competing together against nonconsumption."

I would contend, as I pointed out yesterday in my piece about YouTube, that what the world wants is for the Internet to enable a whole new way to get content. What Online news outlets have done so far is simply 'automate' the delivery of content. Perhaps this is why after an initial surge in viewing of online news it too is starting to flatten off and potentially decline. My contention is that this is because there is a distinct lack of innovation taking place in online media (what a generalization I know). Maybe this is what the Pew study is really showing...

YouTubification - is this what the media needs?

I have to say I’m a big fan of YouTube. What is clever about this site from my point of view is not that there is great content on there (which there is) but the way it keeps you clicking and digging deeper. It makes me wonder if what they’ve created here is a better model for the media now that the Internet has become the common way to access news and information. If you go on the site to see a specific piece of content when you are done you will immediately be presented with other related content you may enjoy. In other words it redraws the content around your search. If you compare this to most news sites it seem light years ahead. Take Google News as an example; on the news site you can view a news story but then when you click the back button (which is your only way of being returned to Google News) you are presented with the same headlines despite the choice you made. This is pretty well the model of all news sites. In essence they have buckets of content that stay in the same place regardless of what you do as a user. Imagine however a news site that once you clicked on a news item, then reselected the content on its homepage based on the choice you just made. So for example you click on a news item about United Airlines returning to profit (which is a miracle in my opinion but that’s whole other story). Once you clicked on the news at the side would be other travel related news items, item by the same journalist from the last few days, previous articles on the topic etc etc. When you returned to the homepage the content would also be slightly different. The closet I’ve seen to this is on BBC's site where they have links called ‘related articles.’ These links tend to be pretty straightforward though. From where I sit a YouTubification of the media has to be the way forward if they want to keep our attention.

Oh and while I'm at it, anyone care to guess how long it is before someone like Google buys YouTube?

Only in England

Let me first say I'm British and proud of the fact. However, there are things only the British can do and today I discovered a truly wonderful Britishism. In the UK there is a government institution called Companies House. Well the web site says:

The main functions of Companies House are to:
1. Incorporate and dissolve limited companies
2. Examine and store company information delivered under the Companies Act and related legislation
3. make this information available to the public.

For anyone wanting to find out about a UK business it is wonderful resource. Through the Companies House web site you can buy copies of people's filings such as their latest set of accounts. Anyway, this is where the Britishism comes in. This wonderful example of ecommerce in action is only available from 7am to Midnight UK time. Presumably the security guard switches off the computer when he leaves.

The $10,000 PR problem

This seems like a crazy problem, but it seems Silicon Valley is again awash with money and wants to spend it on PR - sadly though it would seem there is a shortage of people who they can spend it with - this particularly the case for those companies that want to spend about $10,000 a month. Before all the relative newcomers to PR dash out to set up PRismybag.com and soak up all this demand they should understand the real problem. The real problem is that the people who want to spend all this money want 'experienced' PR pros. This is of course where the catch lies. So many good people left the industry when the bubble burst that there are not that many great people around who have more than 5 years of experience (which is in turn driving up salaries). In addition the problem with most of the start ups that want to spend this kind of money is that they want at least $15,000 worth of service. The last of the problems is these businesses want lots of media attention and sadly since the bubble burst the media they can reach has shrunk. In any other market than Silicon Valley this problem would seem ... as silly as it sounds. Perhaps this might encourage some of the start ups to launch in another market where their $10,000 a month will go a lot further such as China or good old fashioned Europe.

Toyota thinks outside the box

There is a computer game out now that requires you click on a veiled object to move to the next level. That object turns out to be a Toyota Yaris. This is all a part of Toyota's effort to reach the youth market. I learned this from a NPR story this morning. There are also a string of games out now that have billboards inserted at certain locations in the game. Nothing exciting about that except when you play online, these billboards check your IP address and where possible other sources and then load billboard ads that are more targeted. Imagine, it's 8pm and you're locked in battle with some alien on your computer. OK, I can't quite imagine as I'm not a gamer but if I was then it would make sense that an ad on the building I'm approaching which houses the alien I'm trying to kill would be for the local pizza place. I mention all this for the simple reason that as traditional advertising dies along with traditional media, the creative minds being applied to interactive ads are coming up with some great thinking. Is the PR industry applying similar thought? I've seen glimpses of it but I worry that at a time when PR could be taking a bigger slice of the marketing pie we are not being creative enough.

AOL - this call was monitored for quality assurance purposes

This is a great example of the power of blogs and one of those rare times when the call was monitored for QA purposes by... the customer. The story is simple: It seems a normal guy wants to do something normal - cancel his AOL account. When he tries, they do what all struggling businesses do, they try and stop him by asking him a million stupid questions. Only in this instance he recorded the conversation and put it on his blog. The story then ended up on CNBC. Seems the rep at AOL lost his job...

http://www.cepro.com/news/editorial/13792.html

NYT publishers get desperate

The New York Times plans to begin running ads on the front page of its business section starting in July, according to a spokeswoman today. The news is yet another sign that traditional media is struggling and yet another sign that they don't really know how to solve the problem. Fundamentally this is a sign that the NYT wants to generate more ad revenue from its print publication. This would make sense as a move if the circulations of media like the NYT were rising but it's not. Surely therefore slapping ads on the front of the business section is like putting a Band-Aid on the Titanic. At what point do publishers realize that consumers want a different product? Don't get me wrong - I believe they want the content; they just want it delivered in a different way.

WSJ shows the way (the wrong way)

PR people are meant to be nice to hugely important publications like the WSJ. Sadly I can't resist taking a pop at the WSJ today. Why? Well today it proudly published its D supplement (they even have special stickers on those newspaper vending machines announcing its presence). In the supplement are a host of interviews with top execs including Bill Gates. There are articles on such racy topics as E-Commerce (does anyone use that term anymore?) and Laptop security. Think about that for a second (or two). There is no content here that is truly going to get the world excited. Certainly no content that is going to get people talking. I just can't see people huddling round the cooler saying: "wow that piece in today's journal was a real eye opener." Let's assume that the readership of the Journal is the investment community for now. If I were a fund manager, I'd hope I already knew the stuff in the Gates interview or the E-commerce article. Take the following question posed to Billg: "When are you going to ship the new Vista Operating System?" I don't think I need to tell you that he said we're on track to ship it in January. I have to say that it's content like this that is getting traditional media into trouble.

Coblabberation

This is hopefully not one of those posts that is designed to say "I read the Wall Street Journal today." Instead it is designed to add to your vocabulary a great new word that Jared Sandberg introduced through his column 'Cubicle Corner' today. The word was actually used in a quote by Harvard Graduate School professor, David Perkins. He was endorsing the general view of the column which is that most brainstorming is ineffective and that if anything you need people to think alone and then bring their ideas to a group - otherwise you get 'coblaberation.' While he doesn't specifically explain the word, it's pretty clear that he means you get a lot of people talking and nothing much happening. Does that sound like a PR brainstorm you've been in lately? Anyway, read the piece, it has some good observations that may help your next visit to the collective white board.

Spin Bunny reborn?

A site with the same .... attitude as Spin Bunny has popped up. Called "the World's Leading' which is presumably a jab at the fact that just about every tech PR press release seems to open with company X being the world's leading...

We'll surely find out if this is Spin Bunny if it starts attacking Lewis Communications.

Tech stocks are hard to index

I just spent some time looking at the relative stock prices of major technology companies versus both the DJIA and the NASDAQ composite over the last six months. Result? I couldn't find a single stock that came close to tracking these indices. You have stocks like Google that have jumped around all over the place and have ended up 8% down compared to the DJIA. Then you have Intel which has steadily declined a staggering 33% over the same period. There are bunch of stocks such as Microsoft, Yahoo and Dell that have declined just less than 20% and others such as IBM and Apple that are down 10%. At the other extreme I can find a few stocks that have risen relative to the DJIA. These include Oracle and Cisco at around 12% and AMD up about 18%. What does this tell you? Well in part it tells you that roughly three in every four major tech stocks are falling at 10% versus only one in four rising at a similar rate. While this is not the most scientific study on the planet it does suggest that as a group the major tech stocks have some work to do to convince investors they have growth potential. If the sample had produced a more random pattern I'd suggest that the problem lay with the individual companies and their IR but I think the challenge is greater than that. As I've said before on this blog, I believe the challenge is sector related. Until the sector works together to solve this problem, generally poor stock performance is on the cards.

Daily?

I just read the New York Times piece on today's down day on Wall Street. One sentence stood out: "Shares of Wal-Mart dropped $1.35, or almost 3 percent, to $48.30, after the retailer said its May sales growth would be at the low end of its expectations." Think about this for a moment. This mammoth retailer is giving monthly guidance on its sales! I run a small public company and I know how hard it is to predict sales with any certainty. To be giving monthly guidance seems crazy to me and reflects the way stock trading has changed since the bubble. It seems we now expect companies to be able to report by the minute how their business is performing. Why? Because it can be done of course. Not because it actually means anything. I can all too easily see how with the use of technology companies will have their stocks traded 24 hours a day seven days a week. To feed this constant market, they will be expected to report with ever-greater frequency. This is simply not a good thing. It drives businesses to run on shorter and shorter cycles. This means they stop investing in the long term and start responding simply to the latest analyst forecast. I'll be honest the only solution I see to this problem is for all companies to adopt the stance taken by Google that has been so widely ridiculed by Wall Street - namely not go give guidance. If everyone stopped giving guidance and simply let the analysts try and figure it out, we'd have a few rough quarters while they learned how the businesses they watch really work and then my guess is we'd end up with a much less volatile market full of businesses far more focused on the really important issues - like their customers.

As another door opens..

In recent months there have been some unusual announcements in the technology industry. Only on Friday we had the surprise departure of Tom Perkins from HP's board. What made it surprising was that nobody gave a reason, not that he actually left the board. The resounding but thoroughly unconvincing 'no comment' from HP made it clear that something ugly must have happened but the PR people were clearly told to stick to the classic rebuttal. Even though it's clear even a poorly trained PR person could have come up with something better. "He felt his job was complete now that Hurd has clearly got HP back on track," would probably have done it.

The other surprise news last week was that Intel finally lost its stranglehold on Dell. After years of trying, AMD finally secured a foothold in the PC giant's line-up. What interested me is that it's not that long ago that Intel secured its first place in Apple's lineup. Does Dell know something Apple doesn't? As the saying goes, ‘as another door opens...’

IPG - when not if

As Interpublic continues to struggle, the question becomes: "When will they get taken out?" rather than if. It's quite clear from IPG's most recent set of poor earnings (they've had a string of them), that the business is not about to turn the corner anytime soon. To try and correct matters the group has made significant changes to the management team and its corporate structure. None of which would appear to have worked. Revenues are sluggish compared to its peers and profits are, well.. they don't make a profit and haven't for some time. Reuters last week described the business as being in a 'tailspin." A mixture of accounting scandals and client defections is at the heart of the matter. The former has ratcheted up the accounting costs for the company putting it in to loss, while the latter has weakened the foundations of many of the Group's businesses.

All of this points to the prospect that WPP, Publicis or Omnicom will take out IPG. Of course you may argue that they don't need to. IPG would seem to be giving away their business right now. That said the business does still have sizeable revenues (around $5Bn a year) and would surely do better as a part of one of these Groups. I can only imagine then the pressures IPG shareholders are placing on the IPG board to find a suitor and get a deal done. So in my mind the question is definitely 'When?' not 'If?' and of course 'Who?'

IP and PR

Every so often the PR industry heads get rightly annoyed by clients that effectively steal their IP. It happened to me earlier this year when a pretty big company took some pretty extensive thinking done as part of a pitch and simply used it without paying for it. Now in this instance it was hard to actually go and charge the prospect for the work without looking cheap but a principle was being broken which was hard to sit back and watch. But like most agencies we sat back and we watched. Sadly you tend not to get paid for sitting back and watching.

This event has troubled me for some time, not because the client effectively stole the IP but because the client didn’t even think it was a problem. In truth I’m not sure many clients realize where the IP we as an industry create starts and ends. After all, it’s tough to describe most work as being truly unique, especially when most campaigns are in effect a rehash of an idea used for another client. That’s a pretty harsh but in some cases fair description. Indeed, if you spend any time judging awards in the PR industry you will notice the same ideas being used time and again for different types of companies, with different effects. Looking at this another way, what the industry is really doing is taking the same common ingredients and then cooking them in a different way to produce a different dish. Of course a chef will staunchly defend their ‘unique’ recipe for a certain soufflé, yet a PR pro will struggle to defend their unique approach to a product launch. Here-in lays the challenge to protecting IP in our industry.

Price it
A critical element to protecting IP is finding a way of charging for it. I recently met with a firm in the UK that charges clients for the value of an idea, not for the time it took to create. The argument here is that a client should take the best idea, not the one that took the least or most amount of time to dream up. On this basis the agency won’t discard the first ideas they generate for fear they’ll only be able to bill the client for 10 minutes of brainstorming. Instead, they can hold an exhaustive brainstorm and genuinely pick the ideas they truly believe in. I personally like this approach but in talking with some of my industry colleagues who’ve tried it they’ve often found clients baulk at the concept. It seems their procurement departments fear that by accepting there is IP being purchased they will open the door to ongoing charges for use of that idea. Now of course such practices are common in the advertising world. Perhaps this is what the procurement people are trying to prevent.

Document it
Another critical element in the IP struggle is the documentation of the ideas. Now in truth the law says that you don’t need to register copyright to own it. All you have to do is to be able to show that you documented your ideas first. That’s assuming of course your fear is that your ideas will get stolen. Of course this is easier said than done. I’m pretty sure that I could come up with a derivative of an idea that would sound pretty different to the original. While this is technically covered by the law, I’m guessing the originator would struggle to make a claim given the sheer costs of taking legal action in this country.

Educate
In truth I think the biggest issue in the IP battle is one of education. By this I don’t just mean the education of our clients, though I do believe this to be critical, I also mean the education of our staff. If they don’t appreciate the true value of the work they’re doing how can they expect the client to do the same?

The missing link (to business processes)
By truly understanding the value of our ideas and thinking we open the door to solving the IP problem. After all if we recognize that our IP is simply a good tag line or creative stunt, then we have to expect the client to pay accordingly. Great IP is more than this. Great IP is a set of thinking that links to business processes – it may even create them. If we educate our people to come up with thinking that links to the way clients run their businesses, or better still improves the way they run their businesses, then there is a far greater chance the client will appreciate the full value of the ideas being presented. This in turn will shift the needle away from PR being commoditized and towards being a tool that really builds businesses and brands.

So if PR wants to become a true form of consulting it needs to think long and hard about the ways it links to the client’s business and stop thinking just about how many hours were spent on a particular program. While the latter should get paid for, in the long run the real opportunity is to use our skills to significantly improve the fundamentals of clients’ businesses. Now that’s what I call real IP.

Ketchum is hiring

Don't ask why Ketchum thinks I'd be of help or interested but they emailed me (spammed me) twice today about the vacancy they have in San Francisco for someone to run their consumer tech business. If anyone knows anyone that wants the job do call Nabil Khatib at 415-984-6123.

When good news sparks a crisis

In the last week the major oil companies including Exxon, Chevron and ConocoPhillips have all been announcing record profits and revenues. Good news for those that invested in these businesses. But it's interesting to see how this relatively good financial news has worked against them. Earlier this week Senator Byron Morgan announced his desire to see a Windfall tax imposed on these oil giants. You can see why such a suggestion has been made but most economists seem to feel it would be counterproductive and only lead to them finding ways of reducing their profits to avoid taxes - such as even higher pay deals for their CEOs.

The other side effect of the news as been a raising of people's consciousness about how much it really costs to drive a typical car in this country. It's still a lot less than it costs in Europe but if things continue as they have the gap will be gone in less than 18 months. This is forcing people to rethink their lifestyles and choice of transport. This morning on NPR they ran a feature showing how many people are now looking at car pooling or public transport simply because of the increase in gas prices. In other words, the gas companies are in danger of having customers finding ways to avoid buying their product. That's not something most businesses want to see.

So if you couple the great earnings news with the CEO pay scandal that emerged around Exxon's CEO and then add the fact that consumers are starting to rebel you get a great PR and potentially real commercial crisis brewing. It's rather interesting at that level. Most crises are driven by bad news such as product defects, plunging sales and crime ridden management teams, not businesses that have managed to hike the price of the product and make super profits. Perhaps this is why the oil industry is struggling to deal with an issue even our Pro Oil President is starting to get angry about. Only today in a piece the Associated Press ran entitled "As Profits Soar, Oil Industry Unapologetic," Bush was said to be "outraged" by the profits the oil companies are making.

Of course the fact that the profit margins being made by the oil giants is actually pretty modest is getting little coverage or sympathy. Why? Because even though they are only generating around $9 of profit for every $100 in sales, compared with the roughly $20 of profit eBay and Microsoft make on similar revenues, the scary part is not the margin but the sheer amount of profit, coupled with the fact that every consumer is starting to feel it impact them directly. Not everyone buys and sells something on eBay every day but most of us get in a car that regularly.

Time for a good old fashioned crisis plan to be brought out by the oil barons I feel. But it needs to start from a very different place of course.

PR is back

If anyone was wondering, it should now be pretty clear from this week's UK and US PR Week league tables that our industry is experiencing its best time since the dot com boom. Indeed if you look at the US top 40 companies the average growth was 13%, with only four companies either going backwards or standing still. The highest growth came from our own Bite Communications at 63%, but equally there were 18 of the top 40 (that's almost half for the none mathematicians) that produced growth of over 20%. Of course these league tables don't include the numbers from the real top 10 agencies such as Weber Shandwick, Fleishman Hillard et al due to their parent companies refusing to take part on SOX grounds a reason/excuse I still feel is rather feeble. Looking at the top 10 in the PR Week US table, the growth rates were less impressive. Only APCO and Schwartz beat the 20% growth rate and half the firms either standing still or growing less than 5%. This would suggest that the sweet spot for agencies right now is for agencies with around 60 people and revenues of around $10m.

The other piece of data that caught my eye in the US table was the revenue per employee. For the top 40 this averaged an impressive $188,000. There were several firms that blew past this such as Sloane & Company who averaged $309K, Levick Strategic Communications at $276K and Integrated Corporate Relations at $293K. I wonder how many of their clients are now checking their hourly rates. At the other end of the scale were firms such Schwartz that averaged a mere $126k. Interestingly again there is a big difference between the average for the top 10 and the top 40. For the top 40 as I've said it was $188K, whereas the top 10 was a less impressive $170k. To confuse matters more, out of the firms that grew 20% or more the average revenue per employee was just below the average for the top 40 at $184k, suggesting that growth has been achieved thanks to offering a slightly more competitive rate. However, if you look at the firms that grew 30% or more their average revenue per employee is slightly above the average at $191K. In other words, all this figure really tells you is which agencies charge the most to their clients and which agencies potentially pay the most or least to their staff.

I guess all of this goes to show that even if the really large agencies don't take part there is still something to be gained by having these tables.

Innovation doesn't equal stock market success

In its last two issues Business Week has produced cover stories on two great topics. The first was the poor stock performance by America's largest companies despite some impressive performance over the last five years. The second is the current issue's coverage of the "World's most Innovative Companies." The thing that caught my attention was that there were actually a number of companies that feature in both stories. Of course the second story makes no reference to the first because if it did it would have to point out that sadly investors don't give a hoot about innovation (assuming the research is true). There are of course some notable exceptions. Among Business Week's top 10 most innovative companies are Apple, Google and Toyota. In all cases their stock has done well in recent years. Also in the list however are GE ( stock is down 30% over the last five years), Microsoft ( stock has declined 20% in the last five years) and 3M (stock is unchanged for the last two years). In Business Week's current issue they applaud GE's move to challenge its reliance on six sigma, in the previous issue they lament the fact that despite the company's great performance its stock is, to put it crudely, in the toilet. Of course what is clear from these two articles is that many of the companies that have embraced innovation are performing very well as businesses and perhaps that is something that sooner or later Wall Street will accept and give them credit for.

PR should take a leaf out of the advertising book

I read an interesting article this morning on how advertising is using technology. The piece focused on how billboards are getting smarter and gave examples such as how in the future they be able to beam coupons to your car as you drive along for stores close by. What struck me after reading the piece was that I don't hear much about how people are embracing technology to the same degree in the PR world. Of course technologies such as Vocus and Biz360 are gradually becoming more common but forgive me for saying that these are really just tools to automate existing ways of doing things. They don't enable you to do something you couldn't have done before. This in turn made me question how technology could disrupt the PR world. My first thought was to look at the sales process customers follow. Right now traditional PR influences certain parts of the sales cycle through news, product reviews, case studies etc. Through Blogs PR has picked up the opportunity to talk more directly to customers if it so wishes. But what if we took a leaf out of the advertising world's book and used the very same technology they are thinking about to get PR generated content into the hands of customers instead of advertisers? So instead of a billboard sending a car a coupon, how about as you arrive at Best Buy you get sent (to either your phone or blackberry) an abstract or a podcast of a product review comparing your client's products with that of its competitors? How about when you register your new product instead of receiving annoying offers online, you get news or feature articles relating to the product you bought? Put another way I think there's a real opportunity for the PR world to engage in a dialog with the advertising industry to embrace the great thinking that's taking place on the use of technology and broaden its use to encompass PR. In fact the only problem I can see with this is that the ad industry may not want to talk for fear they will loose out on valuable marketing dollars in the future.

PR doesn't rank as academic

It might not come as a complete shock but PR isn't considered terribly academic, at least not when it comes to search results from both Google and Microsoft's new academic search tools. Google's scholar tool produces hundreds of thousands of search results (as it does for almost any topic) but sadly nothing of any value appeared in the first ten pages I waded through. Microsoft's Academic Search produced a few but only a few interesting articles. That said I didn't expect any given the search tool is really aimed at the computer science, physics, electrical engineering, and related subject areas.

A new bubble?

In the last few months I’ve heard a number of people suggest we may be experiencing dot com bubble 2.0. Certainly in the PR space, we’ve seen a rush of new start up clients all keen to make their mark before they need to raise their next round of funding. We’ve also witnessed the VC firms raising money with relative ease. Put another way, money is not in short supply which is perhaps why so many have said it feels ‘bubble-ish’. While I too am slightly concerned I see some signs that this time around things will be different. Firstly, last time around many of the so called startups were little more than a set of PowerPoint slides, albeit slides about a really cool idea. This time around they have real technology and they have real customers. Second, last time rents were skyrocketing along with stock option grants. This time around, the economics seem to be in control. For example, all the startups I’ve seen this time actually feel like startups – there are very few Aeron chairs these days. Third, last time around you simply had to get some customers to get on track for an IPO. This time things are different. Indeed the data from 2005 shows Initial U.S. public offerings fell by 39 percent, to 41 during the year from 67 in 2004, according to VentureOne. And of the companies that went public, they collected $2.2 billion from their offerings, down a massive 56 percent from the $4.98 billion raised in 2004. And let’s remember 2004 was hardly a good year. So IPOs are few and far between which is good and bad news. The good news here is that this means people are much more focused on building real businesses. The bad news is that if these real businesses need serious capital injections to take them to the next stage, then they don’t have the public markets to go to. So while I may be guilty of not wanting to believe there’s another bubble on the way any time soon, from where I sit I don’t see the same pressures building, which may of course simply mean the bubble will be a different shape...

Google has clearly upset Chirac

Google must wonder what the French have against them. First they openly challenge its library book project then they fine them in a trademark case and now they fund the development of a new European search engine. They originally had the backing of Germany for this rather significant technological undertaking but that appears to have been withdrawn. Nevertheless the French are pushing ahead with Quero, a search engine that one of its developers described on the BBC today as being different from Google by offering ‘serendipity’ through its searches. I bet that’s not the word Google is using.

IXCO still stuck at 1000

Back in January I wrote about the NASDAQ ticker for tech stocks, IXCO, and my hopes that the tech sector would have a break out year. Two months later..the breakout has yet to happen. The IXCO has retreated to 900s having broken above 1000 for a while. This is despite an economy that's doing well, despite the major companies all reporting solid numbers and even despite RIM settling its lawsuit, thus keeping the Blackberry addicts online.

Now I spent the weekend with a VC whose optimism is addictive and whose ideas for new devices and services seems to filter into every conversation. Indeed, I woke up this morning convinced that the problem the technology industry faces is not a lack of opportunity. If only a fraction of the ideas I heard this weekend come to life the tech industry will be twice the size it is today. No, the problem is that Wall Street has not been convinced that the market really is going to get that much bigger. I firmly believe Wall Street views all the new ideas not as new markets but simply more competition for the existing one. It's no shock therefore that the stock prices of Microsoft, IBM, Oracle, Intel, Cisco and Dell have either stayed flat or have even retreated. Indeed only Apple, Google and HP have showed any signs of life. Google's stock has been very volatile of late, Apple seems to have stalled and HP is really only getting back to where it should have been. Not a great report card.

I don't believe the reason for this is poor performance by the tech vendors. Indeed, out of the companies I've mentioned all have reported revenue and earnings growth in the last twelve months. No, the problem it would seem is, as I've already said, Wall Street doesn't view the tech market as one that is going to grow, or at least not one that is going to grow fast enough. This is of course counter intuitive. We all know that there are still large parts of the world yet to be brought online. We also know that our personal consumption of technology has far from reached its limit.

Solving this will require the tech titans to promote messages of market expansion far more aggressively. It will also require Wall Street to listen which may prove to be the hard part. After all, they heard this message a few years ago only to see it turn out to be an 'overstatement'.