Thursday, March 17, 2005

"corporate VNRs, the biggest and richest part of the fake news business"

This afternoon I listened in on a conference call among some of the top PR execs in the business of producing video news releases (VNRs), more honestly called fake news. I can report they are proud and confident that the recent "flap" on the front page of Sunday's New York Times about the Bush administration's use of fake news will amount to nothing at all. These PR executives are elated that the New York Times piece was about government propaganda, and not about their much more widespread and lucrative production of corporate VNRs, the biggest and richest part of the fake news business.

....The conference call was arranged by PR trade press maven Jack O'Dwyer. It featured top PR executives in the fake news business, including Doug Simon of D S Simon Productions, Stan Zeitlin of West Glen Communications, Larry Moskowitz of Medialink Worldwide and KEF Media's Kevin Foley. These are the companies that are producing and distributing the thousands of VNRs sent to TV networks and stations each year. The VNRs are fake news stories, paid for by clients ranging from the Pentagon to Monsanto, that are aired by TV news producers as if they were independent reporting and the work of real journalists, rather than PR operatives who used to be real journalists.

The real journalists at the TV networks and stations are engaging in fraud and plagiarism on a massive scale when they pawn off these VNRs as real news. If you were a journalism student with an assignment to produce a TV news story, and your professor discovered that someone else had done all your work for you and given the story to you to pass off as your own, you should be expelled. But in the real world of TV journalism, you would just collect your paycheck and go home.

There is also payola involved. Money flows from the VNR producing PR firms to the TV networks for "distribution costs," and the networks send the VNRs out to their affiliates for use on the air. it all: PR Execs Undeterred by Fake News "Flap", PR Watch

Tuesday, March 08, 2005

email of the day

CBS Offers Misleading Pro-Privatization Predictions

March 8, 2005

CBS Evening News has presented two segments in recent weeks (2/9/05,
3/4/05) that purport to show how typical American workers would fare under
George W. Bush's plan to privatize Social Security. But the segments rely
on stock market projections that, if true, would make any "crisis" in
Social Security almost impossible.

CBS reporter Jim Axelrod first profiled (2/9/05) Jama Whitesell, a
28-year-old receptionist making $32,000 a year. Axelrod went to a
financial planner who predicted that a private account would be a safe bet
for this worker-- based on a projected 8 percent return on the private
account. Why did CBS choose this figure? Axelrod claimed that is "an
assumption based on how the market's done the last 80 years," though he
did add that "in the next 40, Jama could do worse. Of course, she could do

Axelrod returned to this theme more recently (3/4/05), profiling a
48-year-old worker earning $98,000 a year who would also benefit from a
private account-- again, relying on an 8 percent return on his private
account. Axelrod again pointed out that "nothing's guaranteed, certainly
not an 8 percent return." (Interestingly, an earlier CBS Evening News
report-- 2/5/05-- estimated a 9 percent return on a private account).

It's true that stock prices in the past have fluctuated markedly; looking
at 35-year spans, which is the length of a typical working life, stock
returns over the past 100 years have fluctuated between 3 and 10 percent
(Center for American Progress, 2/10/05). Including a range of results
would give viewers a better sense of the range of potential outcomes.

But even suggesting that 8 percent will be the most likely growth rate for
private accounts over the next 40 years is problematic. For one thing,
the projections made by the Social Security actuaries and touted by the
Bush administration estimate a lower return (about 4.6 percent), both
because they expect stock prices to rise more slowly and because private
accounts would likely be balanced between stocks and bonds (Economic
Reporting Review, 3/7/05; NPR, 2/4/05; Washington Post, 2/27/05).

And there are good reasons to think that stocks will grow more slowly in
the future than they have in the past. Though CBS explained that they're
using the 8 percent figure because it is a historical average, the Center
for Economic & Policy Research (2/10/05) points out that "current
price-to-earnings ratios are approximately 50 percent higher than their
historic average." This means that stocks are valued more highly today
than they have been in the past; in order to match past growth rates, they
would have to make a similar upward leap in the future, when history
suggests that they're more likely to return to their earlier, lower

In any case, a stock market growing at a sustained rate of 8 percent would
only be possible in a robust economy, a situation which would swell Social
Security revenues, heading off any crisis or shortfall. The projected
shortfall is based on gloomy forecasts that foresee the nation's economy
growing at a much slower rate than it has over the past 80 years. It is
unfair in the extreme to compare the future of Social Security with the
return on private accounts by using two very different economic models.

Stories tracing the impact of policy on individuals can be helpful for
viewers who do not follow the minutiae of public policy debates. But
giving viewers an unrealistic view of the benefits of Social Security
privatization only serves the interests of the White House and its allies.

ACTION: Please tell CBS Evening News to use a more realistic range of
numbers when projecting the returns from Social Security privatization.

CBS Evening News
Phone: 212-975-3691

As always, please remember that your comments have more impact if you
maintain a polite tone. Please send a copy of your correspondence to

Tuesday, February 08, 2005

CNBC shuffles exec deck

In a sudden move to boost its plunging ratings, CNBC has shaken up its top brass.

CNBC kicked CEO-President Pamela Thomas-Graham upstairs and brought back one of its former hot-shot producers — Mark Hoffman — to help revive the 24-hour business news channel.

Thomas-Graham — a 41-year-old Phi Beta Kappa graduate of Harvard and its law and business schools — will relinquish her two hands-on titles and become chairman to handle "new strategic opportunities," including spinning off shows.

"I'm not going anywhere," she told a news conference. "You'll still see me around here and in New York. But I'll be off looking for new opportunities to grow."

Hoffman worked at CNBC for four years during its heyday in the late 1990s and was known for his ability to create jazzy teasers to keep viewers tuned in.

He rose from executive producer to president of its CNBC European operations, which he left in 2001 to become president of NBC-owned TV station WVIT in New Britain, Conn.

Beginning his new post immediately as CNBC president, Hoffman, 47, will be responsible for all day-to-day operations, programming and technology.

"We've had some external challenges and internal challenges," Hoffman said. "I'm not prepared at this point to make any pronouncements. We'll chart this new course and we'll do it pretty quick."

Insiders said that Thomas-Graham as late as last Thursday was still sitting in at news meetings.

Her old position of CEO won't be filled, the company said.

Hoffman will report to Jeff Zucker, president of NBC Universal Television Group, as well as Graham.

Graham will continue reporting to Robert Wright, chairman of NBC Universal and a vice chairman of its parent, General Electric Co.

In 2004, CNBC's total viewers during the daytime slipped 21 percent from an average of 184,000 to 146,000, according to Nielsen Media Research. Since the Internet meltdown of 2000, CNBC's daytime viewers have declined 61 percent, while its primetime ratings have skidded 64 percent.

CNBC's defenders at NBC say the cable network brings in more than $250 million in annual profit and gets top dollar for ads because of its audience of wealthy Wall Streeters.

In addition to its ratings slump, CNBC is also gearing up for competition from Fox News, which is expected to launch its own business-news network sometime this year.

Both Fox News and The Post are owned by News Corp.
CNBC Change by Paul Taylor, New York Post, 8 February 2005

Monday, February 07, 2005

Ameriquest exposed

Critics say Ameriquest, touted as an industry model, fabricated data, forged documents and hid fees. The company denies wrongdoing.

Workers Say Lender Ran 'Boiler Rooms'
by Mike Hudson and E. Scott Reckard, Los Angeles Times, 4 February 2005

Thursday, January 27, 2005

Media watchdog tracks White House effort to police Social Security news coverage

From FAIR today in an action alert, Private Vs. Personal: Media's Social Security Semantics:

Facing significant opposition to its plan to privatize part of the Social Security program, the White House is pushing reporters and lawmakers to use the expression "personal accounts," since polling data seems to indicate that "privatization" is an unpopular term with voters.

While it's not unusual for politicians to try to spin the terminology used in debate, journalists should avoid changing word usage simply because some politicians think it will be to their advantage. There's little doubt that "privatization" is a more accurate description of the White House plan, especially considering that the current Social Security system is already based on what are essentially "personal accounts"-- your benefits depend on how much you personally have paid in, as the annual statements you get from the Social Security Administration indicate-- rendering the Bush administration's preferred terminology redundant and confusing. What is different about the accounts that Bush is proposing is not that they are personal, but that they will hold private-sector securities-- in other words, that they will be privatized.

But some outlets endorse the notion that using any variation of the term "privatization" is politicizing the story. As Time magazine explained (1/10/05), "Because Democrats have given the term 'privatization' a negative tinge, advocates prefer to call it 'personalization,' emphasizing control and ownership rights." NBC host Tim Russert said on Meet the Press (1/23/05), "The president is proposing personal or private accounts, the vocabulary differs according to the ideology or the party using it."

But the term "privatization" was for years embraced by its proponents as an accurate description of their position. The Cato Institute, an influential pro-privatization Beltway think tank, called its program the "Project on Social Security Privatization" before re-naming it "Project on Social Security Choice" in 2002 (New York Times, 10/6/02). That change was attributed to Republican lawmakers who wanted to avoid using an unpopular term to describe their policy.

This semantic debate is no accident. As the Washington Post reported (1/23/05), "Republican officials have begun calling journalists to complain about references to 'private accounts,' even though Bush called them that three times in a speech last fall."

One would hope that in a debate as important as this one, reporters would resist this GOP spin. But the White House may be having some success: Carl Cameron of Fox News, in a news conference question to George W. Bush (1/26/05), made reference to "those who opt into a potential private account"-- before quickly correcting himself to say "personal account."

The Associated Press has also shown evidence of adopting the GOP's semantics; as CJR Daily pointed out (1/25/05), last year reporter David Espo used the phrase "private accounts" fifteen times in Social Security articles, while referring to the accounts as "personal" only once (10/17/04, 12/6/04, 12/7/04). But this year, "private accounts" has nearly disappeared from his vocabulary: A Nexis search of his reports on Social Security through January 26 turn up 16 references to "personal" accounts and only two to "private" accounts (outside of direct quotes).

Aside from echoing Republican spin, this semantic shift can muddle the story. In one recent report (1/24/05), for example, Espo wrote that the AARP "released a nationwide poll today indicating deep public skepticism about President Bush's plan for personal accounts." But one paragraph later, he explained that AARP's poll asked about private, not personal accounts.

The Times similarly confused the AARP poll; a January 25 article on the Social Security debate, which made three references to "personal" accounts and only one reference to "private investment" accounts, reported that "the AARP released a poll showing little public support for personal accounts once the costs and tradeoffs involved in establishing them are made clear." By changing the terminology of the poll, the Times and the AP added extra layers of confusion and inaccuracy to what should be a fairly straight-forward story.

Wednesday, January 26, 2005

Keeping up with Social Security news coverage

The Center for Economic Policy and Research is doing a great job of summarizing and analyzing ongoing news coverage of the Bush push to gut Social Security. CEPR also collects this coverage in a free weekly email newsletter, the Social Security Reporting Review. Subscribe to it, and CEPR's other fine email newswletters here, including: the weekly ERR (Economic Reporting Review) in which Dean Baker of CEPR evaluates the economic reporting in the New York Times and Washington Post; Mark Weisbrot's weekly column; and Data Bytes (Economic Data Analysis) in which CEPR economists analyze the latest releases from the Bureau of Labor Statistics on unemployment and prices, and from the Commerce Department on GDP (gross domestic product).

Tuesday, January 25, 2005

enter the era of media critique

"Here we are in an age where the media covers the media about what's gone wrong with the media."
That's Louis D. Boccardi, former president of the Associated Press who, together with Dick Thornburgh, were invited by CBS to investigate the Rathergate scandal, in a New York Times profile today, A Self-Effacing Arbiter of Media Failures by Robin Finn.

NYT notes links between prominent cardiologist & healthcare companies

A prominent cardiologist is identifed by a shill for a number of health care companies, in a long New York Times article today that focuses on his conflicts of interest in patient care:

Like many prominent researchers at the nation's major medical centers, Eric J. Topol, the chief academic officer of the Cleveland Clinic Foundation, has over the years had consulting and financial ties with numerous drug and medical device companies.

Dr. Topol, an outspoken cardiologist who frequently opines on the medical issues of the day, has done work for drug companies like Eli Lilly, the Medicines Company and a partnership of Bristol-Myers Squibb and Sanofi-Aventis.

Recently, however, as he has come under the spotlight for potential conflicts of interest, he said in a letter to one company that he had decided to end most of his relationships to "maintain my academic credibility." it all: Patient Care vs. Corporate Connections by Reed Abelson and Andrew Pollack, New York Times, 25 January 2005

TV news will use more corporate PR video news releases in 2005

Look for more corporate PR in the business news as video news releases (VNR) find their way into more television programming in 2005 as a result of more companies paying to place their VNRs in the news, according to a recent PR Week article:

Guaranteed placement, extending a VNR's life, and scientific medical stories. All of these and more are trends that broadcast PR will see continue in 2005.

Video news releases have always been an important tool for the PR industry. While the most popular subjects for VNRs remain more or less the same, where and how they're being used has certainly changed. Last year brought a noticeable increase in certain trends that could become even more common this year. Navigating those trends, and deciding which are here to stay, could be the key to getting your client's VNR on the air.

Factors such as a shrinking news hole and increased competition have prompted companies to explore other ways to get VNRs aired. In fact, most broadcast PR companies are now encountering requests to ensure placement in a non-traditional way for the PR industry - by paying for it.

Ed Lamoureaux, SVP of sales and marketing for West Glen Communications, says he has noticed a significant rise in the use of guaranteed or paid placements for VNRs.

"The idea of securing a placement and using a VNR is more of a grassroots outreach and has become very popular," Lamoureaux says. "It goes hand in hand with the coming together of advertising and PR."

And Lamoureaux is hardly a stranger to the concept. For the past 17 years, West Glen has been producing Health and Home Report, a 30-minute news magazine program that guarantees VNR placement. There are several of these guaranteed-placement shows being produced, some of which appear on cable stations like PAX.

For some companies, guaranteed VNR placement is a better way to spend marketing dollars, says Lidj Lewis, VP of media relations for Medialink. "It uses a PR technique to diversify the marketing mix," he adds.

Michelle Williams, director of production for Medialink, says she has seen an increase in the use of guaranteed placements and has had a lot of success with them. One of the biggest advantages, she points out, is that guaranteed placement programs often target a very specific demographic, which helps when producing a VNR. "You know the audience," she says. "You can cater your story to that audience."

Another option within the guaranteed-placement arena is the captured audience, says Doug Simon, president and CEO of DS Simon Productions. These are networks that air in controlled environments, such as health clubs and airplanes.

According to the article, healthcare-related VNRs will be especially popular. Another trend: companies will recycle the VNRs in internal corporate communications programs to help all employees sing from the same sheet music.

Read it all: Achieving success with your VNR in 2005 by Erica Iacono, PR Week, 17 January 2005, republished at freepress.