1999 The Year in Events

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John Kennedy Jr. wanted to create a media sensation with his own political/pop culture magazine, George. Sadly, the title received its widest coverage only after Mr. Kennedy, his wife Carolyn Bessette, and sister-in-law Lauren Bessette, died in July when the plane he was piloting crashed into the Atlantic. Mr. Kennedy's partner in George, Hachette Filipacchi Media, has decided to continue publishing the monthly magazine, and in October bought out the Kennedy family's interest to become the sole owners. Former Money editor Frank Lalli is on board as new editor.


Courtroom drama once again captivated Americans as they tuned in to see billionaire Bill Gates do his best to wiggle and worm his way out of allegations that his software powerhouse is a monopoly. But U.S. District Court Judge Thomas Penfield Jackson ruled in November that Microsoft most definitely has a monopoly. After all, the company's operating system boots on nearly 90% of the world's PCs and its Internet Explorer, bundled with most PCs, guides users through the Web. But being a monopolist is not illegal unless that status is used to violate antitrust laws. A decision on that is yet to come. If found guilty, Microsoft could go the way of Ma Bell: broken up into several entities. Look out, Baby Bills may be just around the corner.


Call it the "pocketbook issue" or simply the "big boom," but under whatever name, the economy and prosperity thundered forward in 1999 with the stock market, consumer spending and most economic indicators headed for record territory. One of the Federal Reserve's biggest worries was whether the continued good times and growth was shrinking the labor pool in ways that would force up wages and inflation; while some Democrats expressed concern that the pace of company consolidations might be eliminating better paying jobs. On the advertising side, the only question was whether the portion of the boom caused by the yearend blitz of dot-com marketing is sustainable in 2000.


Consumer magazine publishers could not get away from the relentless march of state attorneys general challenging the cheapest way to get new subscriptions: sweepstakes agents American Family Enterprises and Publishers Clearing House. Numerous legal actions, filed by states including Florida and Texas, finally prompted AFE to declare Chapter 11 bankruptcy protection and brought on the resignation of President-CEO Susan Caughman. She was replaced with Sports Illustrated executive Brian Wolfe last month. It also prompted Congress to pass a new law that will require additional disclosures on sweepstakes mailings. The magazine industry's losses will continue to reverberate into next year as publishers look for cost-effective alternatives.


In 1999, the flame was once again turned up on the telecomunications pricing battle. Longtime foes AT&T Corp., MCI WorldCom and Sprint Corp. jumped into the fray with 5-cent night time pricing for the latter two companies and 7-cent all day pricing from AT&T. On top of that, the fine print on dial-around advertising, also known as 10-10 service, got smaller and smaller and more complicated. The Federal Trade Commission finally said enough is enough. It convened a committee in November that sternly reprimanded the phone companies shenanigans on behalf of consumers.


Thanks to the Internet and an economy that wouldn't quit, online stock trading became a game for the masses, with advertising to match. The leaders in online brokerage -- such as Charles Schwab & Co., E*Trade, Ameritrade and Discover Brokerage -- all hiked their ad spending, sometimes doubling and tripling their media buys to cut into the $1.1 trillion pie that exists, according to consultancy Gomez Advisors. Industry executives estimate online brokers will have spent $1 billion to $1.5 billion in advertising by yearend.


A handful of companies began offering free PCs or Internet access in exchange for users viewing targeted ads. The idea seemed plausible at first, but NetZero, the leader in offering free ISP service, has lost money. And Free-PC, as of November, no longer exists as a separate company. It was subsumed by low-cost PC distributor eMachines, and its original business model has been rendered moot.

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