Forecast: Tech/Telecom

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WorldCom's stunning disclosure that it cooked the books to hide $3.9 billion in costs casts a pall over the troubled telecom sector. Fallout from accounting scandals that have racked the swashbuckling telecom and tech sectors will hit marketing budgets, according to industry pundits, and marketing expenditures will have to prove return on investment.

With the sector in such disarray-Adelphia Communications, Qwest Communications, WorldCom, Nortel Networks and others struggling-prospects are bleak for robust ad and marketing commitments. Campaigns are likely to be less grandiose and more focused on deliverable benefits. Spending for less sexy projects like customer-relationship management and direct marketing via the Internet will receive the most attention.

AT&T Wireless, which launched a new brand positioning in January, is on track to maintain current spending levels; industry prognosticators predict AT&T Wireless may up spending slightly next year.

Microsoft Corp., Intel Corp. and IBM Corp. have indicated flat to slightly below 2001 spending levels. Sun Microsystems and Cisco Systems, once highfliers, have struggled to maintain a brand advertising presence, and budgets remain moving targets.

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