That's because ICG parent Carat North America also owns Carat MBS, New York, which does spot TV buying for MCI Communications Corp. through MCI's ad agency, Messner Vetere Berger McNamee Schmetterer/Euro RSCG, New York.
MCI agreed there is no conflict because Carat North America operates the two as separate companies, ICG and MBS, under an umbrella -- much like an Omnicom Group or Interpublic Group of Cos. manages its holdings.
DEALING WITH CONFLICTS
Media buying companies, like agency holding companies, are working to deal with potential conflicts by spinning off new, separate operating units. Carat is believed to be setting up a third media buying operation in the U.S. Carat executives would not comment.
Industry insiders were taken aback when Ameritech, during its review, said it would consider a media buyer whose sister offices held other telecom accounts (AA, Nov. 3).
"That's an issue a lot of advertisers will have to face," said Marilyn Lunenfeld, director of corporate media at Ameritech. "Just like the car industry, now it's telecommunications."
Ameritech began searching for a new media buyer after Leo Burnett USA, Chicago, resigned the business.
Carat now is believed to have bowed out of the media review being conducted by SBC Communications, and also is said to have turned down Bell Atlantic Corp.'s initial request for proposal.
MCI does not offer local residential phone service, as Ameritech does, but both do offer local business service. MCI plans to become a local consumer service provider once regulatory and legal wranglings are resolved, which may be another six months to a year or longer.
FEW 'CLEAN' AGENCIES
MCI and other telecom companies said it's difficult to find agencies that are completely "clean" -- without even small account conflicts.
Consultants who want to offer clients a long list of potential agencies for reviews are currently having a hard time doing so in telecommunications.