February 2010

Toyota dealers in five southeast states have pulled their commercials off ABC TV local affiliates, complaining about the coverage of Toyota safety problems by ABC News and its chief investigative correspondent Brian Ross.

The ad agency representing the 173 dealers told ABC affiliates last week that the shift was due to "excessive stories on the Toyota issues." The dealers shifted their commercial time buys to non-ABC stations in the same markets, "as punishment for the reporting," according to an ABC station manager. ABC News and Ross began reporting on the problem of "runaway Toyotas" last November in a series of stories that preceded the large recalls ordered by the company, and apologies for quality shortcomings as well as misstatements about the extent of the defects. Toyota is now expected to add the 2010 Prius to its list of recalled vehicles.

There's a frequent line in President Obama's speeches that makes every U.S. tech executive cringe: his vow to cut tax breaks for "companies that ship our jobs overseas."

Obama's brushing over some details here. The U.S. tax code does not literally give a company a tax break every time it moves a job offshore. But it does allow companies to defer paying taxes on their overseas profits, so long as the money remains invested outside the U.S. Obama has vowed to change this part of the law, and for months tech CEOs have been coming through Washington howling about the dire consequences of raising such taxes on multinationals. They've made some inroads with the administration, but based on what's in the president's 2011 budget released last week, Silicon Valley and DC are far from done battling over taxes. The details are buried in the budget on page 161, Table S-8 under the heading "Reform the U.S. international tax system." If the proposed changes go through, the administration estimates it will bring in $122.2 billion in added tax revenue. As far as the administration is concerned, the added money will not only help close the gaping deficit, but stop U.S. companies from ducking out of domestic taxes by shopping around for which country has the best tax rate.

The Homeland Security Department's information technology budget request for fiscal 2011 is $6.4 billion, the highest among civilian agencies. And Richard Spires, the DHS chief information officer, is concerned that the agency doesn't have the processes, skills and people in place to successfully manage all of it.

"What bothers me most we have very little institutionalization of process disciplines, standards and tools to run programs," says Spires today during a speech in Washington sponsored by IAC. "We have pockets of excellence, but we also some very troubled programs." Spires is reviewing all 79 major IT investments at the agency. He says the review is about half way done and, so far, no program has been deemed "fatally flawed."

The rise of social media has helped end one of the longest streaks in Super Bowl history - Pepsi won't have a televised commercial during the big game for the first time in 23 years.

Instead of paying millions of dollars for 30 seconds of airtime, the soft drink giant is pouring resources into an online social-networking campaign designed to engage and interact with customers for months. It's a move that raised eyebrows among traditional media watchers, but social media experts say Pepsi has called the right play for a rapidly changing advertising game in which consumers are becoming the mass media that carry the message. And relying on standard TV, print or online banner ads may no longer be enough.