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Archive for February 12th, 2005

FTC and product placement: No label required

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Has the FTC (a.k.a., depending on your POV, the Federal Trade Commission or the Feds Tuck it to Citizens again) stiff-armed attempts to identify and label product placement in programming?

Commercial Alert, an advocacy organization in Portland, Ore., asked the FTC “to require that placements be prominently identified with a superimposed message like ‘advertisement’ as they occur during programming.” (See how it works.)

That means Commercial Alert wants some goofy little arrow pointing at a Coke can in a movie, shouting, “It’s an ad! It’s an ad!” Well, we could do without that annoyance and intrusion on artistic license, can’t we?

Says Businessweek’s David Kiley: “Product integration into TV shows, video games and even magazines is taking off. More and more advertising is going to be woven into the shows we watch, the games we play and the magazines we read. Why? Because advertisers have spent so many years hurling static, uninteresting or obnoxious ads at us, we have driven demand for technology that enables us to skip the ads. Advertisers don’t like that, especially when they are paying big bucks for the time and space.” (Read more.) notes that marketers are pressing for print magazine product placements in editorial content.

Product placement is fundamentally a practice of deceit. Why is that particular product in that particular movie or TV show at that particular time? Or that magazine? Or that web zine? By chance? Or by paid-for intent?

The FTC admitted that “there may be instances in which the line between advertising and programming may be blurred.” Why should we put up with a blurred line?

When will marketers eventually pressure newspapers for product placement in editorial content? That’s a significant concern.

Note, too, that product placement has become a significant funding source for programming of all kinds, especially films. If certain products fund films, does creativity get stifled in the product placer’s desire to have an appropriate “buying mood”?

The FTC’s mission: “In general, the Commission’s efforts are directed toward stopping actions that threaten consumers’ opportunities to exercise informed choice.”

Hmmm. That doesn’t sound like the agency that increased the likelihood of less informed choice by rejecting Commercial Appeal’s petition.


Written by Dr. Denny Wilkins

February 12, 2005 at 2:07 pm

Posted in Uncategorized

H-P’s version of job creation: Buy another company?

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Remember that American Jobs Creation Act? (See my earlier post.)

You know, the act that allows some of America’s largest corporations — just once — to get a break on taxes on profits they’ve been accumulating overseas but have not repatriated. Corporations get to pay 5.25 percent rather than 35 percent when they bring these profits home.

They’re also supposed to tell us what they plan to do with that money. Remember, it’s a “jobs creation” act. That money is supposed to create jobs. Congress said so.

Hewlett-Packard (the company that just sacked glamour queen CEO Carly Fiorina) has $14 billion ready to swim home. And that’s just a small fraction of the $400 billion America corporations want to free from high-tax hell.

Fiorina’s out because her grand acquisition of 2002 — Compaq Computer — was supposed to “synergize” H-P and expand its line of products and services. But, as The New York Times points out, that move “greatly increased Hewlett-Packard’s dependence on the cutthroat PC business …” and hurt the ol’ bottom line.

H-P’s strength has always been imaging — printers, copiers and supplies for same. But now, the Times says, that division produces about 75 percent of the profit but only about 30 percent of revenues. And H-P has revenues of $81 billion.

So how does H-P return to its core imaging business? And strengthen its market position accordingly?

Create more jobs in its own imaging division? Have more people make more H-P printers and copiers and make them better than anyone else’s?


Sell those divisions that hurt profitability, such as its corporate computer unit.

And buy Eastman-Kodak or Xerox — both big names in the imaging business.

Will buying create Kodak or Xerox create more jobs?

Nope. We’ve seen it time and time again — when huge corporations merge, “efficiencies” are realized, and jobs get whacked.

Kodak, at $9.8 billion stock market value, and Xerox, at $14.2 billion, won’t come cheap.

So how will H-P foot the bill?

Remember that $14 billion in profits parked overseas? You know, the $14 billion H-P will be taxed on at only 5.5 percent? You know, the $14 billion that’s supposed to help, under the American Jobs Creation Act, actually create new jobs?

Keep your eye on H-P and what it does with its $14 billion. And keep an eye on Pfizer ($38 billion) and Proctor & Gamble ($10.7 billion). And on Eli Lilly, Bristol-Myers Squibb, Johnson & Johnson and > Plough (a combined $37 billion).

They’ve all got big money sitting overseas that will cost a pittance to bring home. And I bet they’re all in a buying mood — not in a hiring mood.

Written by Dr. Denny Wilkins

February 12, 2005 at 1:03 pm

Posted in Uncategorized