Marketers brace for change following election

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Now that the election's over and Sen. Barack Obama is the president-elect, the real fighting can begin. With the Democrats riding to victory with promises of change, it's a safe bet the next Congress and administration will look to make a mark on advertising and marketing issues.

Most of those battles won't start until next year, but some of the implications could become apparent in coming weeks as Congress reorganizes and the new administration names its leadership. Washington advertising and marketing association officials suggest that the election's focus on the economy and health care could mean many marketing issues would take a back seat, but that doesn't ease their worries.

Their biggest concerns: A major debate about health care could prompt discussion of limiting direct-to-consumer drug ads and perhaps of ad taxes.

“Fasten your seat belts. It's going to be a bumpy ride,” said Dick O'Brien, exec VP of the American Association of Advertising Agencies.

He said U.S. Rep. Rahm Emanuel, D-Ill., who has accepted the position of chief of staff in the Obama administration, talked to the Four A's board of directors several weeks ago.

“He predicted that the first order of business in the new Congress will be shoring up the economy and bringing the deficit under control. Then, out of the blue, he volunteered that this would cause our industry some pain. When pressed to elaborate, he said that, in their quest for new revenue, one likely possibility would be to go to pharma and tell them they could keep the write-off for R&D or DTC, but not both.”

Other association execs said a change in administrations could bring new efforts to impose privacy curbs on the profiling marketers can do, as well as heightened antitrust enforcement.

Here are some of the implications they point to:

Privacy: The Bush administration has approved a series of deals allowing marketers to better profile and target consumers, rejecting the objections of privacy groups. Privacy issues are expected to get far greater scrutiny. There has been discussion of naming a privacy czar in a Democratic administration.

-The FTC: The Federal Trade Commission regulates many industries, but not telephone companies or airlines, and its regulation of financial services is limited. Sen. Byron Dorgan, D-N.D., has proposed expanding the FTC's duties into additional areas and giving the agency authority to levy civil fines and the ability to speed rulemaking. A more Democratic Senate and a Democratic administration will increase pros- pects for those changes.

-The FCC: The first question is whether the Federal Communications Commission would reverse the Bush administration's easing of media ownership rules. Obama has been exceedingly critical of recent changes to the rules. He questioned whether the FCC acted before sufficiently understanding the impact added consolidation could have on minority media ownership, local programming and local news. Whether he would backtrack is uncertain.

-Net neutrality: With Democrats in charge, a ban on Internet providers giving favored content providers a faster path to consumers is a near certainty. The only real question is whether the ban is imposed by Congress or by the FCC. Consumer groups contend a ban would make it far easier for smaller upstart Internet content providers to grow.

-Justice Department: Critical scrutiny of marketer- and media-related deals will likely increase.

-Congress: The election will change some of the main players for media issues, carrying with that change some uncertainty. It's not yet clear if the Senate Commerce Committee's chairman, Sen. Daniel Inouye, D-Hawaii, will depart to head another Senate committee, but if he does, his replacement would be Sen. Jay Rockefeller, D-W.Va. Rockefeller has questioned violence in the media and offered legislation that could set some limits.

Ira Teinowitz is Washington bureau chief of BtoB sibling publication Advertising Age.

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