NEW WORLDCOM MONIKER A CHALLENGE IN BRANDING THE MERGED MCI, SPRINT

By Published on .

Most Popular
When MCI WorldCom bought MCI Communications Corp. last year, Chairman Bernie Ebbers wanted to keep the WorldCom name but realized the value of the MCI brand. He eventually settled on MCI WorldCom.

Next year, Mr. Ebbers may finally get his wish.

No. 2 long-distance provider MCI WorldCom plans a $129 billion merger with No. 3 Sprint Corp. And if the deal is approved, the new company will be called simply WorldCom.

Regulators are just beginning to look at the record-breaking deal. The approval process with such giant mergers tends to be slow; the earliest the deal may be finalized is mid-2000.

Industry analysts and insiders said the companies have a steep challenge ahead because name recognition for WorldCom still is relatively low.

"It was a sticky decision. They had to come up with a singular name. WorldCom is the least well-known but the best description for the future," said telecom analyst Jeffrey Kagan. "It'll be a huge effort, but so is paying more than $100 billion for a company."

MAINTAINING BOTH BRANDS

The new WorldCom would maintain both the Sprint and MCI brands, an MCI WorldCom spokeswoman said, much as Procter & Gamble Co. has both Tide and Cheer detergents. It's unclear, though, which brands will be used for which phone products.

"It's premature to talk about anything other than getting regulatory approval and combining the companies," the spokeswoman said.

McCann-Erickson Worldwide, New York, handles Sprint, but has only had the business since late 1998. Messner Vetere Berger McNamee Schmetterer/Euro RSCG handles MCI WorldCom. Messner Vetere has had a long relationship with the MCI brand, though its relationship with WorldCom is relatively short -- since the MCI WorldCom merger became final in September 1998.

Grey Advertising, New York, and Publicis & Hal Riney, handle Sprint's business-to-business and wireless advertising, respectively.

Donino, White & Partners, Atlanta, handles MCI's UUNet unit.

JORDAN AS SPOKESMAN?

Michael Jordan may continue as pitchman for WorldCom; in 1996, he signed a 10-year deal with then LDDS WorldCom, which evolved into WorldCom.

In addition, Mr. Ebbers, a former basketball player and coach, is a fan of the retired basketball great.

Warner Bros. has a multiyear contract with MCI WorldCom, not only for use of the Looney Tunes characters in its advertising but also for other potential marketing deals for movie and TV properties. The deal expires in March.

Whichever agency wins out -- and it could be a combination of two or more -- analysts believe the shop or shops will have plenty of work to do to rebrand WorldCom. The new company will have to spend lots of money to re-educate consumers, they say.

And even though MCI WorldCom has been using that name for a year, as one analyst pointed out, everyone still refers to the company in shorthand as MCI.

"Between the two companies, that seems like an awful lot of history to throw overboard," said Robert Rosenberg, president of telecom consultancy Insight

In this article: