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It was popular in London financial circles last week to talk of the "de-merging" of marketing communications holding companies as the market tried to rationalize the undoing of Cordiant.

The problem is that the whole argument is specious. Yes, the Cordiant holding company's management has decided to split what's left of the Saatchi & Saatchi Co. empire into three separate companies barely a decade after it came together. But Cordiant/Saatchi

& Saatchi Co. was never really a holding company. It was just Maurice and Charles Saatchi's wish: a grand wish, perhaps, but ultimately based on a rudderless global vision and unsound business planning and practice.

To now question the value of all holding companies, as some have, is no less misguided than was the creation of Cordiant itself. Holding companies do work if they are well-managed and assist in strengthening their agency and other service brands rather than emasculating them. By empowering their properties, holding companies themselves become strong brands. But even an architect such as WPP Group Chairman Martin Sorrell has said the value of any holding company to shareholders, including his own, must be weighed against its costs.

Omnicom Group just became the first advertising-related company of any kind to make the Fortune 500 list (No. 492) for the simple reason that it works. Indeed, both Omnicom and rival Interpublic Group of Cos. are the envy of some Cordiant family executives. "For them, it's all just been smooth sailing," sighed one last week.

Interpublic was not on the Fortune 500, but just missed making it (by four slots). In part, it has succeeded where Cordiant did not because it quickly saw the value in centralizing certain services-including real estate, benefit plans and acquisitions-to save costs while keeping its own overhead down. And, notwithstanding Mr. Sorrell's cautionary comments, his WPP Group is in the company of both Omnicom and IPG as another smoothly functioning operation, albeit after some early missteps.

So we don't believe other agency holding companies will ultimately share Cordiant's fate. And remember: Out of Cordiant's ashes will rise two new publicly traded companies that will likely function as holding companies. May they be more beneficent than their forebear.

The new guidelines from the Council of Better Business Bureaus' Children's Advertising Review Unit (CARU) for marketing to kids on the Web are a significant step forward. Site designers now have some clear signposts on how to begin to discharge the special obligations involved in dealing fairly with kids and their parents.

CARU wisely avoided the rigid prohibitions some marketing critics advocate. Its standards require that ads be clearly identified but allow a role, outside of ad matter, for Tony the Tiger and Barbie on Web sites from Kellogg Co. and Mattel, for example-so long as they aren't directly pitching a product. And they require site designers to seek parental involvement when seeking to collect information or take purchase orders.

These policies will be the starting point for more discussion about marketing to kids on the Web-within the ad community, with consumerists and with the Federal Trade Commission. Major differences remain about the ability of young children to separate selling messages from information and entertainment matter on the Web. But, by acting to get these guidelines out, CARU and the ad industry members that worked with it demonstrate they are committed to conduct themselves

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