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TrendReport 2002
What will 2002 look like? According to Stanley Bing, pseudonymous Fortune columnist and real-life PR executive for CBS, "Short term, the first part of 2002 will feel a lot like the end of 2001…a year that was distinguished, more than anything else, by the fact that we survived it."

As always, we've focused on the national business press: what we predict the media will cover in 2002 and the context and background that will help shape business news coverage. What do we mean by context? Those of you familiar with the national business press know that they are not driven by product announcements. The national media focus on trends and issues, and more often than not, how those trends and issues will affect the average American consumer. Therefore, it is important to be aware of the context in which stories are being reported. For this reason, we look at larger trends and issues we expect to surface in the coming year – not just the gizmos and gadgets that might make the headlines.

The two big business stories for the year have probably already hit: Enron and the state of the economy – specifically when the recession will end.

By now, much has been written about the implications of the Enron-Andersen debacle. From a media relations perspective, the most important implications are these:

In terms of the economy, the media relations implications include:


Overall Trends

Here are additional topics we think will interest the media throughout 2002:

  • The War Against Terrorism and Security: There may not be a direct business story - other than as a potential drag on the economic recovery - but the media will continue to devote resources (i.e. reporters and space) to covering this story. Business reporters will cover the impact that increased security expenditures and new policies will have on the U.S. and global economy, including personal investments. The media will also report on domestic terrorism preparedness, personal safety and workplace safety, and the cultural impact of terrorism (psychological impact of crisis/Post-Traumatic Stress Syndrome and how organizations are dealing with employees, reluctance to travel, etc.). Balancing security and privacy will continue to be an issue. The media will continue to be interested in advances in biometrics devices. Impact of terrorism on the economy, business travel, insurance, etc.
  • Pharmaceutical Pricing: Are pharma companies charging too much? Are insurance companies not reimbursing at realistic levels - if not, what can senior citizens do to afford the drugs they need? Why does the same pill cost more in some countries than others? How much does marketing a new drug cost? This issue will become a more important story as we get closer to the mid-term elections.
  • Convergence and Home Networking: This was a big trend at the Consumer Electronics Show (CES), probably the most important consumer technology convention. As consumers continue to "cocoon," they will continue to shop for and buy cool technology for home use. The incredibly fast adoption of DVDs, along with its dramatic price drop to under $300 (in some cases, under $100), has already been one story widely covered. The next step, judging from CES, could be easier-to-install, more reliable home networks that link not just home PCs, but TVs, phones, everything to make it easier, say, to download your favorite MP3 song and then listen to it from your stereo.
  • Layoffs, Bankruptcies and Industry Consolidation: While layoffs have slowed, compared to last year, they have not abated, and will likely continue through much of 2002, despite some economists seeing the light at the end of the recession tunnel. Bankruptcies also are likely to continue, including some large well-known corporations for whom other cost control options (including layoffs) have failed to stem the red ink. This could lead to consolidation in many sectors. According to a recent PricewaterhouseCoopers survey of senior executives, 60% of senior executives at large multinational corporations expect an increase in M&As over the 12 months; 90% expect M&As to increase over the next 24 months.
  • Whither IPOs?: After a major drop in the number of IPOs in 2001 from 2000 (when $97 billion was raised in 406 deals), more companies will go public in 2002 (though not at 2000 levels), led by online payment provider PayPal (imparting deja vu when its stock soared despite a lack of profits, among other risks) and discount airline JetBlue.
  • Airline Industry Slump, Travel/Transportation Alternatives and Increased Security: After its worst year ever, the airlines now must pay for huge new security-related expenditures, resolve training issues and handle passenger resistance to slow lines and frequent delays, including an increase in the number of suspicious-passenger evacuations at terminals countrywide. We can expect continued coverage of financial problems as airlines try recovering from losses last year of $1 million per day; there could be some bankruptcies and consolidations. The media will continue to cover new security technologies that will make passenger screening faster and more accurate. The media will also look at consumer travel alternatives - with a debate about Amtrak's role and subsidies - and business transportation alternatives, including rail and trucks, along with new freight security procedures.
  • Mid-term Elections: The media will gear up to cover the mid-term elections, re-allocating reporters, space and other resources.
  • Nanotechnology: Forbes, Business Week, The New York Times, etc. have already written about nanotechnology and buckyballs even though new products have not reached the marketplace. Look for significant media attention when the first product actually is ready.
  • Rise of Biotech Sector: The one tech sector generating positive news.
  • Broadband glut: Telecom's meltdown continues with Global Crossing's bankruptcy.
  • Return on Investment (ROI): For VC, reporters and investors, currently the most important three factors in business: ROI, ROI, ROI

Media Overview

In terms of the media environment, 2002 will closely mirror last year.

  • Media continues:
    • to be interested in leadership
    • to look for good stories amid doom & gloom
    • to be very competitive
    • to redefine websites, missions, staff
  • Newspapers, Online sites:
    • cover significant news that impacts stock
  • Magazines:
    • different news cycles = broader business issues

Media Predictions

  • Consolidation continues as more outlets end up as roadkill
    • Implication: changing landscape impacts strategy, focus
  • Day of the 300+-page issue over
    • Business 2.0, Fast Company, etc. won't topple mailboxes for some time
    • Ad slump continues through Q3
  • Tech coverage in national dailies down sharply; number of pure tech stories down about 30-40%; focus of tech coverage is on earnings, pre-announces, etc.
  • Fewer outlets increases competition
    • Implication: who gets "exclusives" will be a key issue
    • Implication: fewer reporters to target (Website and print staffs may merge) – may foster closer relationships

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