MARKET FOCUS: TELECOMMUNICATIONS - Dialing for PR dollars. The telecom sector is reinventing itself thanks to some powerful PR. Julia Hood reports on how the PR industry is cashing in on its investment

No one wants to be called a telecommunications company anymore; the term connotes a bygone era of rotary phones and switchboard operators.

No one wants to be called a telecommunications company anymore; the term connotes a bygone era of rotary phones and switchboard operators.

No one wants to be called a telecommunications company anymore; the term connotes a bygone era of rotary phones and switchboard operators.

Today's companies are positioning themselves as integrated Internet, data and voice service providers.

And the once humble cell phone has evolved into a wireless data tool, allowing the user to locate a nearby restaurant, read a review of it and call for a reservation, all with the same device.

Public relations has been called for in many forms to help the myriad of highly technical but consumer-driven businesses differentiate themselves.

Increased coverage of telecom issues in the press has only pushed the stakes higher.

All of which explains why, in the past 18 months, PR agencies have seen a 20% jump in revenues from telecom practices (see table). Success stories include Edelman's telecom practice, which grew 23% in the past year and garnered dollars 7 million in revenues during 1999. BSMG's grew at the same rate, up to dollars 5 million, while Ogilvy, in conjunction with tech subsidiary Alexander Olgivy, earned more than five million telecom dollars last year.



So what's the PR trick?

In telecom PR, the focus is on establishing a company as the premier brand in its preferred field of expertise, be it wireless data, high-speed Internet access or cable. Advertising is not enough. 'You see the commercials on TV and everyone has global positioning with young kids frolicking in the background,' says Cindy Huff, VP at Alexander Ogilvy, who works on the Qwest Communications account.

'PR is trying to find the meaning behind that.'

Jody Venturoni of BSMG works with such companies as Motorola, Sprint and StarCorp, using customer examples to create messaging for b-to-b clients.

Companies may have very specific telecom needs, such as providing mobile communications and data services to their sales teams. Venturoni and her team gather testimonies from her telecom clients' current customers in order to prove to potential customers how successful these partnerships have been.

Venturoni also works to position the client's high-level executives as market gurus. 'Sometimes the differentiation can't be found in the product, and what distinguishes them is an executive who has a vision of where the market is going,' Venturoni says.

Big stories on mergers, restructuring and re-branding of established companies have dominated the business pages in the past year. One of the most watched companies, AT&T, has tried to stake its claim on the term 'broadband' with a campaign launched during the Olympics.

Broadband, a way to send massive amounts of data down one channel, is possibly the sexiest thing around in communications. The technology is particularly exciting to the entertainment industry, making its wildest Internet marketing dreams come true by enabling sophisticated video products to be downloaded. Even actors like Matt Damon and Ben Affleck have gotten into the game and launched an Internet entertainment company, relying heavily on the spread of broadband accessibility.

But broadband positioning was only a preview to AT&T's big news last month, the announcement that it was breaking up into four specialist companies, comprising broadband, wireless, business services and customer services.

News of the de-merger sparked a media frenzy and a drop in share price, signaling that investors aren't convinced that the breakup will signal a turnaround for the company. But that response is typical for the company with the highest profile in telecom.

'We have had scrutiny of almost White House proportion since 1984,' says Burke Stinson, corporate media relations director and 30-year veteran of AT&T. 'When you are dealing with corporate moves of this magnitude, you damn well better have a corporate PR staff that's up to it.'

AT&T's abiding PR rule is never to say to the media 'I'll have to get back to you on that.' 'That's not going to work in this decade because there are too many instantaneous news sources and an informed public,' Stinson said. 'I believe no company wants to have stories out there that say they are unavailable for comment.'

But AT&T is still saddled with a name that evokes images of Ma Bell and monopoly, while new brands with strategically conceived monikers may be better able to distance themselves from traditional expectations.

One newly minted brand is Cingular, the merged wireless companies of SBC Communications and Bell South. Ketchum worked on the launch in deepest secrecy, ensuring that the employees be told before anyone else. An hour and a half after the satellite broadcast to all staff on October 5, the news releases went out.

Some new companies achieve an unwanted kind of publicity that, nevertheless, pays dividends. When Verizon, the merged company of Bell Atlantic and GTE, unveiled its new name, it got far more attention for a 15-day strike by communications workers than it did for its new brand.

Some in the media called the strike a PR coup.

'It didn't feel like a PR coup at the time,' says Eric Rabe, Verizon's VP of media relations. 'But because of that kind of intensive news interest, people certainly learned how to pronounce the name correctly.' Even so, the company made sure employees knew the correct pronunciation from the beginning by distributing sunglasses with the rhyming slogan 'Eyes on Verizon.'

PR is also essential for telecom companies that are focused on technology rather than consumers. Terremark, an Edelman client in south Florida, was recently chosen to launch and operate the fifth network access point (NAP) in the country. Terremark has been a well-known real estate and construction business in Florida for the past 20 years, so the PR challenge has been to convince analysts and the media that it is now a communications player.

'It's not an easy task,' says Alec Rosen, SVP at Edelman. 'We've had to do a lot of work so the company doesn't get stuck in the real estate section of the newspapers.' The Miami Herald recently cited Terremark as one of the top four companies to watch, a positive return on the 'hard hat' tours of the NAP under construction that Edelman gave the media.



Telecom reaches out

Targeted community outreach has become the goal of many companies, with an emphasis on tying their hi-tech products and services to socially important programs. To that end, Motorola has spearheaded a program to donate old cellular phones to victims of domestic violence. Nokia runs a program called ClassLink, donating phones to schools, to be used by teachers and guidance counselors in emergencies, and also has a relationship with Big Brothers/Big Sisters of America.

Qwest Communications, which merged in July with US West, actually plans to dramatically slash the number of its charitable commitments, from about 180 to 10. The decision was made, in part, because the company wants to be seen as focusing on improving local phone service, an issue that has been a major problem since before the merger. 'If you have a service issue, the last thing you need to spend on is a rodeo,' said Tyler Gronbach, VP of corporate communications.

Getting Qwest's improved service message out is a priority, says Cindy Huff. 'We work in aligning customer service milestones. It's a matter of keeping local media aware and profiling where the company took an extra mile for the customer.'

As the consumer becomes more technologically savvy, the opportunity to place media stories in previously indifferent publications has expanded enormously. The tech press looks for targeted stories on the financial viability of the industry, particularly in a time of market uncertainty.

'We want to know what's going on with the financial health of these companies and how the companies and their technologies affect the global economy,' says Brian Gillooly, special events editor at InformationWeek magazine.

Telecom also has a higher profile in the boardroom.'Our readers tell us the technical people are involved in business decisions all the way to the top of the company,' he adds.

Even the previously resistant consumer press is getting in on the telecoms act.

'It used to be like pulling teeth to even get an appointment to pitch a story with magazines like Better Homes and Gardens and Woman's Day,' says Sylvia Barnard, a VP at Ketchum who works on the Nokia account.

Barnard secured her first appointment with McCall's magazine during a recent media tour. 'Now you see these magazines doing stories on how to buy a cell phone, how to choose your service, and how the service will impact soccer moms or the fashionable person,' she says.

All of which points to the fact that the frenzied consumer demand for telecom is not about to let up any time soon, giving PR agencies an ongoing opportunity to carve out distinctive profiles for their clients' brands.



CALLING ALL AGENCIES: Telecom PR rankings

Ranking      Agency Name             Audit      Telecom income    Growth

                                                (dollars)

99    98                                          1999       1998      %





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