In addition to their continuing efforts to protect the advertising business from undue government intervention, 4A’s Executive Vice President Dick O’Brien and his experienced team in Washington spent much of the year actively studying and planning for the follow-up to the pivotal 2008 elections.
“It is clear that the outcome of this election and the continuing economic stresses we are experiencing will have huge implications in Washington for our business,” O’Brien told the 4A’s Board of Directors at its September meeting. “We have already begun reaching out to current and future leaders and making the case for our industry’s critical concerns before any real threat emerges.
“2008 has been a year to lay the groundwork for the challenges ahead. We are facing a much more activist government at every level. It is not going to be business as usual in Washington, and we must be ready.”
New Initiatives, New Issues
Among other projects, the 4A’s Washington office, along with allied groups representing broadcasters, advertisers, newspapers, magazines, and ad clubs, among others, launched a concentrated series of high-level grassroots meetings in the home districts of key Congressional leaders. The meetings focused on leaders of the House Ways and Means Committee, which originates all tax proposals, including those affecting advertising deductibility, and the House and Senate Commerce and Health committees, which oversee most other advertising issues, especially direct-to-consumer prescription drug advertising, an area of top concern.
As part of its effort to anticipate potential threats, the 4A’s recently became a founding member of a very important and active new coalition of communications groups concentrating on issues concerning behavioral tracking and the growing debate on consumer privacy, especially as related to online marketing and data collection. Industry leaders have begun significant new efforts to establish a meaningful and effective self-regulatory framework for advertisers.
The Washington staff also continues to monitor and react to efforts to restrict marketing to minors—especially foods viewed as contributing to obesity in children, proposals to ban marketing of alcohol products, and other campaigns to alter the First Amendment right to market all legal products.
The 4A’s Washington office serves as the voice of the agency business before critical regulatory agencies, including the Federal Trade Commission, the Federal Communications Commission, and the Food and Drug Administration. Most significantly this year, the 4A’s has been actively involved in ongoing rulemaking actions by the FCC that seek to adversely revise rules on product placement within broadcasts.
State Tax Repeal
At the state and local level, the 4A’s was a key player in the successful effort to repeal Maryland’s onerous new tax on computer services. The law, passed in April 2008, sought to tax such computer services as Web creation and hosting, as well as collection and use of online data. A strong industry-wide effort resulted in the law’s repeal during a special November session of the state legislature.
Supporting the Candidates
Mr. O’Brien and his staff also volunteer their time to coordinate the contributions of the marketing industry’s only political action committee, PROFESSIONALS IN ADVERTISING (PRO-AD PAC). The PAC was an especially important and effective tool during this election year, allowing the communications and marketing industry to support and elect candidates who understand advertising concerns and priorities.
The role of the PAC, which is supported by all segments of the industry, has become more significant with the enactment of strict new campaign and ethics rules that severely restrict interaction between industry leaders and elected officials, confining many activities to fundraising events.
The Post-Election Challenges
Looking ahead to 2009, the 4A’s Washington office will be closely monitoring the actions of a new and much-changed White House which promises a reinvigorated “activist agenda” of regulation, reorganization and revitalization, along with a Congress with a mandate for action and an insatiable need for revenue. In addition the courts are preparing to rule on core First Amendment communications issues, making this year as important for our industry as any in recent memory.
The Top Five Issues for 2009
1) The 100% deductibility of advertising as a business expense - First order of business for Congress and the White House will be finding the funds for their programs; advertising tax treatment could be in jeopardy.
2) Direct-to-consumer advertising of prescription drugs - Pro-consumer groups and well-placed Congressional leaders have promised new efforts to go after “Big Pharma,” including restrictions on DTC marketing, and the first threat may come from proposal to strip deductibility from all DTC advertising.
3) Privacy and behavioral tracking - The hot new item on the consumer agenda, this could be the beginning of a long and intense fight over the future of online marketing, data management and customer research. Watch this one carefully!
4) Empowered regulatory agencies - After eight relatively benign years, most observers expect the key regulatory agencies ― the FTC, FCC and FDA ― to move aggressively, including a new focus on marketing issues. This would have huge implications for DTC advertising, privacy, marketing to children, product placement and decency in the media.
5) First Amendment concerns - The Supreme Court has already heard arguments on a major broadcast decency case (Fox v FCC); other cases are moving up through the lower courts and 2009 could be a landmark year for changes in legal opinions on commercial and free speech.
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