Consulting The board of directors of Arete Associates has named Lawrence J. Delaney president, CEO and chairman of the board. Delaney has over 40 years experience in high technology program acquisition and management and engineering. He will be responsible for the space and missile systems, information systems, propulsion systems and environmental technology. Delaney most recently served as assistant secretary of the Air Force. He was the acquisition executive responsible for all Air Force research, development and acquisition activities. Entertainment Mark D. Detrick was named director and general manager of the marketing division for Universal Studios Japan. He will be responsible for the oversight and development of the marketing division, including the strategic planning and implementation of advertising, group sales, publicity, interactive marketing, corporate marketing partners and creative services initiatives. Prior to joining Universal Studios, he served as management director at Asatsu-DK Inc. in Tokyo. Eric Lewald has been appointed senior vice president of creative affairs for DIC Entertainment in Burbank. He will work with the company’s chief creative officer, Mike Maliani, and be responsible for all aspects of the company’s creative affairs including the development of new projects and maintaining a creative overview of DIC-produced property. Prior to DIC, Lewald was a writer, story editor and supervising producer for Disney Television Animation, Hanna-Barbera and TMS Entertainment. Daniel R. Jensen has been appointed executive vice president for Universal Studios Japan. He will be responsible for the oversight and development of operations and marketing for the international motion picture theme park. In addition, he will manage the daily operations of merchandise, food service, park operations, security, entertainment and technical services. Prior to Universal Studios, he served as senior vice president of resort services for Universal Orlando overseeing facilities management. David “Doc” Goldstein has been promoted to vice president, post-production engineering and sound services for Universal Studios. In his new position, he will manage technical operations and staffing. Goldstein has been an engineer with Universal Studios since 1985. Previously, he worked as an engineer at Warner Hollywood Studios. Health Care Rick Lyons has been named chief operating officer at the Encino campus of Encino-Tarzana Regional Medical Center. Lyons will manage the daily operating procedures as well as legal and regulatory requirements. Most recently, he served as interim president of Bakersfield Memorial Hospital and has been with Catholic Healthcare West for over 20 years. Law Westlake Village-based Masry & Vititoe’s Ed Masry has recently agreed to serve as a member of the board of directors, president and chief executive officer of Save the World Air Inc. He will direct the company’s expansion of engineering, production, marketing and distribution. W Real Estate Shirlee Kingsley was named vice president and general manager of the Ventura County/West Valley region for Caruso Affiliated Holdings. Kingsley will oversee the company’s operations throughout the area, which includes The Promenade at Westlake, The Commons at Calabasas, The Village at Moorpark, The Encino Marketplace, The Courtyard at the Commons and The Promenade Court. Technology Calabasas-based Digital Insight Corp. has named Drew Hyatt senior vice president of Internet banking services. He will oversee all client relations and customer service operations. Prior to Digital Insight, he served as president and CEO of ZMarket. Calabasas-based THQ Inc.’s Brian Farrell, president and CEO, has been appointed chair of the board of advisors for the Harold Price Center for Entrepreneurial Studies at The Andersen School at UCLA. He has been involved with the Price Center’s board since January 2000 and will lead the 30-member advisory board in its guidance of the school’s entrepreneurial program. Farrell first joined THQ in April 1991 as vice president, then served as chief financial officer and treasurer. Prior to joining THQ, he was vice president and chief financial officer at Hotel Investors Trust.

More than 20 years ago, Rockwell International established the Rockwell Science Center in then-remote, rural Thousand Oaks to dream up high-tech components vital to its work as an aerospace industry leader. Today, the one-time corporate research lab is on its own. The former Science Center is now the Rockwell Scientific Co., a four-month-old spin-off that has been retooled as a fully commercial venture. The company, which as the Science Center began doing research and development for other firms five years ago, is now expanding its client base by licensing its technologies and plans to manufacture its own products for the first time. “We’re becoming more commercial and not so much a traditional corporate research lab,” said company President and CEO Derek T. Cheung. With 485 employees in a new firm that had $97 million in revenue last year from outside clients while it was still a Rockwell division, Cheung said his company is poised to become a leader among technology firms in the 101 Tech Corridor. Rockwell Scientific is now a far cry from the costly research lab run by Rockwell International. As research and development becomes more and more expensive, some former corporate research labs have closed down and others, like Xerox Corp.’s Palo Alto Research Center and Lucent Technology Inc.’s Bell Laboratories, have seen the scope of their work cut back drastically. In recent years, Rockwell Science Center began to take on contracts from non-Rockwell clients in order to fund its operations, Cheung said. “It was a money-losing venture from the beginning,” Cheung said. “That’s why there are so few corporate research labs around today.” Since being spun off, Rockwell Scientific has moved headlong into a commercial mode by building an additional $25 million, 67,000-square-foot state-of-the-art manufacturing plant in Camarillo slated to open in November. John Baliotti, an analyst with UBS Warburg, said the spin-off move allows Rockwell Scientific to license and develop new products without the constraints of a corporate structure. “They don’t have to worry about dealing with a Rockwell competitor or developing products that Rockwell can’t use,” he said. The switch from a research lab to a full-fledged commercial enterprise is an easy transition to make, said Cheung, given ideas developed at the center in the past, perhaps not essential to Rockwell International’s core strategy, became moneymakers for other companies. “We had people develop things here and then leave and take them somewhere else,” Cheung said. Time and time again, the center saw its best and brightest head out the door to form their own companies, firms like GTran Inc. of Westlake Village, Opto Diode Corp. of Newbury Park and Telcom Devices Corp. of Camarillo. “They were building their own companies with products we developed here and we weren’t getting any benefit at all from that,” Cheung said. “It was very frustrating.” Cheung’s frustration, however, was not lost on Rockwell International’s leadership, which saw the benefits of spinning off the unit as an independent company still owned by Rockwell. They recognized that not every technology that starts out as the germ of an idea becomes a product that Rockwell can use. The idea was to continue its own research and development work while allowing Rockwell Scientific to operate more as an independent enterprise, developing technologies that it could then market and perhaps even manufacture itself, said Steve Smith, a spokesman for the former Rockwell International. “The thinking was to make the company more independent and have it focus more on its commercial efforts,” Smith said. Rockwell Scientific still does much of its work for the federal government, parent company Rockwell Automation and Boeing but, Cheung said, unlike in the old days, it is now free to pursue clients that compete directly with Rockwell Automation. “We’re like any other business now, free to find our own customers,” he said. “It’s about profit now. Not anything else.” Making decisions in Thousand Oaks rather than at Rockwell Automation’s Milwaukee headquarters allows Rockwell Scientific to better respond to its market and develop its own products, Smith said. “Rockwell was also wanting to focus more on its core automation business and less on its other businesses, which were eventually spun off,” he said. Earlier this year, the Rockwell parent company spun off its avionics and communications unit, Rockwell Collins, to its shareholders, along with its automotive engine manufacturing unit, the Meritor Automotive Co. Rockwell International’s spin-off mania began in 1993 when it parted company with its aerospace and defense unit (which included Canoga Park’s Rocketdyne Propulsion and Power) and sold it to the Boeing Co. “We were fortunate that we were able to take advantage of our market and develop not only our market share, but customers to license our technology,” Cheung said. Already, the company has provided venture capital funding to Oxnard-based Acelo Semiconductor Inc. which makes high-speed semiconductors. Cheung said that won’t be its last investment either.

As you read this, almost exactly seven weeks have passed since the terrorist attacks of Sept. 11. Some things have changed drastically, some not at all. Those who do business in the San Fernando Valley at times feel they have been severely affected; at other times they feel like they are living in a remote land, far away from events on the East Coast. Some people and everybody at one time or the other feel their personal lives are forever changed, others not at all. It’s raised questions about how events “out there” have an impact on us “in here.” Lower Manhattan (even before Sept. 11) can seem so far from Encino or Northridge that nothing that happens there could have an impact on us. However, if you believe we are citizens of the world working in a global economy, tragedy struck very close by. Coming up on two months since the terrorist attacks, I think we have to ask ourselves what has changed for those of us who live and work in the San Fernando Valley? And what will be different in the future? What has become nearly a mantra is that “business was bad before, but it’s really going to be rough now.” Those seem to be the sentiments regardless of whether you work at a Valley outpost of one of America’s largest corporations, own a small store in a strip center, run a major studio, wait tables at a coffee shop or design next-generation products for a tech company. And when we talk about qualities like “bad” or “rough,” we mean everything from losing a job or a company’s earnings were off in the third quarter to deferring business expansion or tabling those speeches to the boss about the raises we deserve. Certainly, the phrase “events of Sept. 11” now are peppering explanations of poor corporate performance, despite the fact that three-quarters of the third quarter had already elapsed by the day of the attacks. You could say the impact terrorists have had in the last several weeks is just a good excuse for some bad news that was going to be hard enough to explain anyway. But that is probably unfair. Yes, the airlines were in peril before all this, even if many of us were not paying attention. But things have gotten worse. There are small companies here in the Valley whose largest customers are airlines. They may have been insecure before; now they’re worried about getting paid for work they’ve already done, let alone orders that have stopped. The anthrax scare has made us all edgy about our mail, even if we don’t live at the White House or work at the U.S. Capitol. It has been devastating for those who make their living trying to figure out how to send you something in the mail that is intriguing enough to get you to open it (and you can read about them elsewhere in this issue). But their jobs had already become tougher as more and more of us relied on e-mail, fax machines and telecommunications for our serious message sending and receiving. Television networks and the print media were already expecting a bad, bad year when it comes to advertising sales. It’s only gotten worse in recent weeks. Tourists are not visiting and hotels and theme parks are laying off those employees who can least afford it; defense-oriented companies are gearing up for what they believe will be a bonanza as both the government and the business world look to make themselves more secure. Beginning way back in January, we spoke of “mixed” signals in the economy. We still can do so, only these days we mean willful optimism is “mixed” with pessimism fueled by real tragedy. The shock of Sept. 11’s horror became transformed into the aftermath of the attacks. Paranoia about anthrax was added. Now, here at the height of the earnings-announcement season, we have the additional element of unfortunate news about our businesses. For most of us, terrorists in planes, anthrax in the mail and poor earnings reports all seem to be part of the same story. We blame Osama Bin Laden, even though he hardly deserves all the credit for an economic slowdown that started a year ago. What he (or somebody) managed to do was get great mileage out of events already unfolding. It is hard to avoid seeing everything through the same prism now and perhaps to avoid blowing news out of proportion. For example, the reality is that, as far as we know, only a handful of letters somehow tainted with anthrax have been mailed to a few addresses. By the end of last week, three people had died, a tragedy indeed but nothing compared to the number of deaths associated with the World Trade Center disaster. But the response has been overwhelming, paralyzing much of American business and society. Somebody somewhere must feel they have gotten quite a bang for their buck. So, seven weeks after the events of Sept. 11 and counting, what does the future look like? Perhaps not much different than it did before. (Try finding an economic forecaster that still doesn’t say things will be better sometime in 2002.) The only thing that’s different may be our attitude, one thing we still can control. Michael Hart is editor of the San Fernando Valley Business Journal. He can be reached at [email protected].

On a recent Thursday, I started my day at the Nickelodeon Animation Studios in Burbank with an early-morning meeting of the Children’s Museum of Los Angeles Commission for Greater Los Angeles. The meeting began with a lively performance of the Children’s Museum Go Readers Theatre Project. Their musical theatre celebration of the delightful discoveries offered by children’s books enchanted this audience of 40 or 50 adults and reminded me of the rich resources that are available through the myriad non-profit agencies that serve the diverse communities of the Greater Los Angeles area. The Children’s Museum of Los Angeles is just one of the many, many non-profit organizations that contribute so much to the lives of the citizens of this area. With the horrors of Sept. 11 and their aftermath still fresh in our minds, this nation has reacted with great compassion to the terrible loss a loss that we all share. It is important to our own healing, as well as theirs, that we respond to the needs of the survivors of the terrorist attacks in New York and Washington, D.C. and of the people of Afghanistan who are innocent victims of this war. But if, by that response, we neglect the needs of our neighbors, we do a disservice to ourselves as well as to all of those we are trying to help. Perhaps it is time to refocus our energies and our resources closer to home to the nonprofit agencies throughout this area that do so much to build strong communities by helping at-risk youth, the mentally or physically disabled, the hungry, the sick, the aged, the battered. Perhaps it is time to remember that through our children, the diverse community in which we live can be united. Perhaps it is time to remember that through the arts and culture our souls are nourished and our appreciation of all cultures is enhanced. We have all been shattered by the events of Sept. 11 and the terrible ripple effect they have created. Whether we are grieving over the loss of friends or family in the attacks, frightened for our personal safety, worried about the struggling economy or shaken by the uncertain future all of our lives have changed in some way. As a nation, we have rallied behind those most directly affected by these events. Now, as a community, we must shift our focus to the institutions that help bind our own city’s wounds. If we fail to support the non-profit institutions and agencies that serve us locally, we will be denying people services they depended on prior to Sept. 11 and will continue to need long after this era has passed. We will be depriving our children of educational enrichment that is essential if they are to grow into the kind of leaders our world so desperately needs. And we will be in danger of losing so much of the ground that has been gained in the area of human services in recent years. The people of the greater Los Angeles area have demonstrated remarkable resiliency throughout this city’s history. In the recent past, we were not only able to rebound from a series of catastrophes, but grew stronger in the process. We can do that again. We are in this together, and together we can and will recover from recent events and face the future stronger and better than ever even if the future means that we ourselves become victims of a future attack. This will not be possible if we neglect the organizations that are there to give us strength in difficult times and enrich our daily lives. Our local non-profit agencies are a vital thread in the fabric of our lives. It is time to focus our resources on supporting them. Cathy Maguire is the chairman of the Valley Industry and Commerce Association (VICA).

Film distributors spend millions of dollars every year making copies of movies with captions or dubbed dialogue for foreign distribution. Agoura Hills-based sound system manufacturer Digital Theater Systems Inc. believes its computer-enabled captioning system for movie theaters can drastically reduce that cost at least for the distributors. “We really hope to change the way American films are shown overseas,” said Michael Archer, director of cinema sales and business development for DTS. The new system, which became available just three weeks ago, allows filmmakers to distribute prints of their films without adding captions or overdubbed dialogue. “The system takes care of all that for them,” Archer said. The DTS-CSS Cinema Subtitling System projects subtitles onto a movie screen via a specially designed video projector that would be installed in the movie theater. The system, which costs between $12,000 and $50,000, depending on the model, uses a compact disk containing the subtitling information which is then projected onto the movie screen along with the film print. Movie studios send their films and accompanying compact disks to movie exhibitors who have the DTS equipment. “Each disk will hold up to 40 languages, so you don’t need to have separate disks for each country,” Archer said. Depending on the complexity of the project, burning captions onto a film itself now costs between $1,000 and $10,000 per film. With foreign distribution accounting for about half of all movie tickets sold, American film studios are looking at the system closely. LaVerne Williams, vice president of worldwide technical facilities for Paramount Pictures, said she was impressed by the device’s efficiency but worries that overseas exhibitors can afford the equipment. “It was amazing to see it work,” she said. “I believe there will be a lot of interest in this system, though the only questions are how much will it cost and are people going to buy it.” Williams said Paramount, which distributes between 12 and 15 films overseas each year using traditional captioning methods, has yet to commit to the system. Archer said the incentive for exhibitors to invest in the new equipment would be the opportunity to get newer American releases quicker, almost as quickly as they are released in the U.S. John Fithian, a spokesman for the National Association of Theater Operators, said theater operators overseas would likely support the new system, if they can afford it. “It’s going to be hard for some theater owners out there to invest in this equipment,” he said. “People there aren’t paying $10 a ticket to see a movie.” The system can also be used in movie houses in the U.S. that screen films for the deaf. There are 17 movie houses that cater specifically to the hearing-impaired with subtitled films, according to Media Access, an advocacy group for the deaf. But this market remains tiny compared to the hundreds of thousands of movie houses around the world that show American films, Archer said. Already, DTS has more than 20,000 movie theaters worldwide that use its multi-channel digital sound system, giving the company potential access to a large segment of the foreign movie exhibitor market. Although the company still is in negotiations with its first customers for the unit, Archer said he expects the device to generate up to $100 million in revenue within five years. “We’re very confident that the DTS-CSS will have a great demand,” he said. Steve Klein, a 25-year veteran film editor, said he welcomes the new system, adding that subtitling techniques have changed little in the past 60 years. “They’re still doing things the way they did in the ’30s,” he said, referring to overlaying captions onto film. While only about 10 percent of U.S. films are dubbed, almost all are subtitled for foreign release, according to the Motion Picture Association of America. Klein said dubbing costs about $100,000 per film and sometimes takes months to complete. “It can get pretty complicated because you have to cast the right people and record a soundtrack and it takes weeks,” he said.

The Oct. 5 release of the Draft Fiscal Analysis report on Valley secession by the Local Agency Formation Commission (LAFCO) initially set off a furor of “I-told-ya-so” backslapping among city officials and those opposed to a breakup. With the exception of city streets, the report gave no indication of how city assets trash, police and fire services, to name a few would be divided or whether they even could be, and, for a moment, gave the impression the secession movement was all but dead in the water. Then, on Oct. 11, the night of the first public hearing on a breakup, a letter signed by Mayor James Hahn, City Council President Alex Padilla and Councilwoman/LAFCO board member Cindy Miscikowski invited LAFCO and secession applicants to join them for an initial brainstorming session to discuss the possibility of holding future negotiating sessions. Where that came from is anyone’s guess. But all parties conceded and met in City Council Chambers Oct. 19 for a “kick-off” session. They walked away with Hahn agreeing to work with secession applicants and LAFCO in dividing up assets between L.A. and a new Valley city and even set dates for four subsequent public meetings. So, why the about-face from Hahn and Co.? Sure, they’ve all agreed not to get in the way of democracy and let the voters take up the issue next November. But they have also vowed to keep Los Angeles whole come hell or high water. Perhaps the three did some thinking and came to the conclusion that, just as in the dismantling of a marriage, sometimes it’s better for the children’s sake to avoid acrimonious public displays over things like who gets what, and simply hope for an amicable solution to the bigger problem. Nah. There’s got to be more. Why else would they jeopardize support from the hundreds of city employees who have also vowed to wage a bitter campaign against being told they no longer work for or, in some cases, live in Los Angeles? “The only thing I can think of is someone has made some serious tactical decisions there that we just don’t know about yet,” said former State Assemblyman Richard Katz. No kidding. Hahn also offered the use of City Hall for the negotiating sessions but LAFCO Executive Director Larry J. Calemine nixed that idea. “LAFCO believes that neutral ground would be a more appropriate setting,” Calemine wrote in a letter to city officials thanking them for their co-operation at the kick-off. So instead, the first of the four meetings was held inside a conference room last Thursday at the County Hall of Administration, also home to LAFCO’ and likely just down the hall from Calemine’s office. So much for neutral. The three remaining meetings are scheduled for Nov. 1, 8 and 15. Who Am I? Why Am I Here? Anyone who attended the “Pros & Cons of Valley Cityhood” luncheon sponsored by the Woodland Hills Chamber of Commerce Oct. 17 and walked away more confused than ever about the issue, take comfort: You are not alone. It seemed first of all that a good majority of the 50 or so members who turned up for the “discussion” were more interested in the lemon cake than they were in hearing about things like alimony and the draft fiscal analysis report. So maybe the point was already lost on those folks from the beginning. But for those paying attention, what they got was a bizarre sort of mock-debate involving Valley VOTE president Jeff Brain, local attorney and secessionist John Walker, Julie Butcher, general manager of SEIU Local 347, and Los Angeles Deputy Mayor Felipe Fuentes. The panel was given an opportunity to answer a series of prepared questions posed by two members of the chamber’s Governmental Affairs Committee. A total of 10 questions were asked, two of which were answered by all four panel members, the remaining eight split evenly between the opponents (Butcher and Fuentes) and the proponents (Brain and Walker). The problem wasn’t so much the questions, but of whom they were asked. For example: opponents were asked what a realistic transition time for a new Valley city to become completely independent would be, and how services would be provided. Butcher and Fuentes mulled that one over and Butcher eventually agreed to tackle it. But how could Butcher, who oversees some 12,000 union members, most of whom are opposed to a breakup, know the answer to this question, let alone care? The last thing she wants to talk about is a plan to divide up her troops for they are, after all, part of the assets. Which explains her response: “I’ll give you that the city takes a long time and we measure things there in dog years.” Translation: Not sure. Probably a good answer. Then another misguided question directed at the opponents: “What is the current demographics of the Valley, and how will the new city (insure) minorities are going to be properly represented if the Valley becomes its own city?” I swear I saw Fuentes, who took that one on, glance over at Brain for some backup. I won’t even get into how or why Lois Curran-Klein, who heads the chamber committee and drafted the questions, doesn’t know the demographics of the Valley. But in order to give those members who either weren’t snoring at their tables or ducking out the back door something to go home with, shouldn’t she have made sure the right side answered the right questions? Here’s the one I’m still spinning over. All four panel members were asked to give two “positive” reasons why the Valley should split, and two “negative” reasons why it should not become its own city. I guess lawyers are used to those kinds of land mines, so the best answer, from where I sat, came from Walker. “I’ll give you three reasons why not to support it,” said Walker. “If it’s not going to improve services for the Valley; if it can’t be done without hurting Los Angeles, and if it’s not going to give the Valley better access to their local government.” Of course, anyone who has been following along knows the key word there was “if.” Because they also know that, with the exception now of fine-tuning the division of assets and getting approval from LAFCO for a ballot initiative, we’re pretty much past the “if” stage and into the big “how.” Reporter Jacqueline Fox can be reached by e-mail at [email protected].

Just days ago, the workers at Edge Communications Inc. were getting ready to help launch a product for one of their clients a promotional mailing that was to include toy crocodiles to illustrate the rugged construction of the firm’s new handheld PC. Today, the Calabasas-based public relations firm is knee deep in crocs. As more reports of mail containing anthrax surface, even a harmless novelty hidden in a piece of mail is likely to arouse fear and suspicion, so most of the crocodiles will remain beached at the Edge offices. “We realize the joke is worth nothing if it gets opened by someone other than the intended recipient or if it turns people off,” said Ken Greenberg, president of Edge. “So we’ve definitely put the brakes on doing this as we initially planned it.” Despite indications that the outbreaks so far are not likely to spread to the general public or even most businesses, fears over anthrax have reached near panic proportions, forcing many communications companies and direct marketers to reevaluate tried and true strategies they once took for granted. Something as innocuous as a Columbus Day greeting containing candy sent by Berbay Corp. to its clients had people asking before opening, not just who the sender was, but what was contained in the envelopes. Bulky envelopes like Berbay’s or the one Edge hoped to send, as well as mail without return address and even packages that are merely unexpected are as likely to end up in the hands of the police as they are to reach the addressee. And even if the communiqu & #233;s get to their intended destinations, they run the risk of alienating an audience that could perceive the mailing as insensitive or frivolous. “Obviously, there’s a sensitivity to opening packages,” said Joann Killeen, chair elect for the Public Relations Society of America and president of her own L.A.-based Killeen Communications. “I also think everyone is more somber now. I think we’re more focused on what’s most important, and I don’t think any of us are in a frivolous mood. You don’t want your client to get a frivolous name in the business.” These kinds of concerns began to surface following the attacks of Sept. 11 and have escalated in the wake of subsequent events, including the latest anthrax scares. Abercrombie & Fitch Co. cancelled its quarterly catalog, concerned that its racy, freewheeling tone was not suited to the nation’s new mood. The Coca-Cola Co. dropped its “Life tastes good” slogan. The Emmy Awards ceremonies were canceled twice and premieres of movies like “Collateral Damage” have been placed on hold indefinitely. “We are rethinking the business, and we’ve already put out positions to our clients,” said Russell Kern, president of Kern Direct Marketing, whose client, the National Aeronautics and Space Administration, was first to call inquiring as to the company’s plans. “All mail needs to address the question of who is this from, and why should I open it.” For Kern, the answer lies in well-designed, professional correspondence that clearly delineates what is contained within. “All these things need to be answered in a split-second,” he said. Still, he and others point out that the growing sense of dread over the mail could not have come at a worse time for direct mail firms, which are entering the all-important fourth-quarter selling season. New screening procedures put into place in a lot of mailrooms are bogging down the pace at which mail gets to its destination and that affects the whole selling cycle. Some agencies say they are not overly concerned by recent events. “At this point, I’m going to proceed,” said Sharon Berman, a principal at marketing firm Berbay in Tarzana. “There are people out there who won’t open anything right now, and there are people saying, I’m just going to continue on.” While mailings without return addresses and other similar approaches designed to arouse curiosity, and therefore get attention, have long been used by some companies, others insist it is the message, not the medium that counts in direct mail solicitations. “If you write something and it’s a good idea, you can put it on toilet paper and people will run with it, and that’s been my experience,” said Laurie Golden, a partner at Jacob’s Well Public Relations and Advertising. Still, Golden has considered using messengers instead of the mails for some of her current announcements. “This really is rather frightening for a lot of people,” she said. Back at Edge Communications, they are testing the waters to see just how much of an impact recent events have had. Although the company scrapped its initial plans to blanket its crocodile teaser campaign on behalf of Seattle-based Intermec, it is going to send the novelties out to a select group of journalists it hopes will review the new PC, alerting them that the mailing is coming in advance. “Fortunately, we have a good story regardless of whether we can get the mailing out,” said Greenberg. “If there’s any sort of lesson I would take from this it’s probably that frothy stuff is just not appropriate for a variety of reasons. So I think if people can stick to the heart of the matter, the stuff that really gets the message across, that’s consistent with doing business, that stuff should continue.” Indeed, those companies that depend on direct mail and similar communication techniques can’t eliminate them entirely. As the recession deepens, staying in front of customers’ minds becomes all the more important. On the other hand, many believe that those marketers that have used tactics like blind envelopes and correspondence marked personal when it is not, instead of more strategic sales approaches, may be left behind, even if the current crisis passes. “I think it’s going to force the people that used the old tricks of the trade to reinvent themselves or go out of business,” said Kern. “It’s called direct mail advertising, not junk mail advertising. The industry needs to learn how to advertise in a way that promotes confidence, not something that tricks and instills fear.”

This was supposed to be the breakout year for the Burbank-based WB Television Network, which has struggled since its inception in 1995 to make a profit. Finally this fall, the sixth-placed network hoped its current lineup would place it firmly in the black. A lot has changed since those hopes were alive back before Sept. 11. Today, while ad revenues are down at every TV network, the situation is even more dramatic at the struggling WB. “It’s been a rough couple of weeks,” said WB network spokesman Keith Marder. Experts say WB, owned by AOL-Time Warner, has a tougher road ahead of it than other networks in garnering added advertising dollars. Because of its relatively small size, it is among the first to suffer when advertisers decide to scale back their spending. “When it comes to cuts, the smaller networks feel it first,” said John Lazarus, president of TN Media Inc., who said advertisers opt to keep advertising spots on larger networks with more viewers rather than smaller ones that serve mostly niche markets. The company is mired in last place with a 1.6 overall rating, according to Nielsen Media Research Inc. Since the fall season began on Sept. 24, NBC has led the ratings race with a 5.3 rating, followed closely by CBS with 4.4, ABC with 4.0, Fox Broadcasting Co. with 3.2 and UPN with 2.5. Each rating point is the equivalent of about 1 million households watching at any given moment. Jordan Levin, president of the WB’s Entertainment Division, said he is confident the network’s nine new shows will eventually gain an audience. Levin said he was pleased and optimistic about the new Superman show “Smallville,” which garnered the network’s highest ratings ever in its opening episode. “We feel we’re on the right track and that we need to stick to it,” he said of the fall lineup. Even with new shows like the dating game show “Elimidate Deluxe” pulling a dismal .9 rating in its second week and Reba McEntire’s new sitcom “Reba,” drawing a 1.7, the network remains hopeful its targeted 13-34 age group will tune in as the season progresses. Just in case it doesn’t, the network has potential replacement shows on the back burner. WB officials admit ad sales are down from the same period last year and that ratings have continued to plummet since the beginning of the new season three weeks ago. Jack Myers, chief economist and CEO of the Myers Reports trade publication, said WB’s ratings drop almost certainly will translate into reduced revenue for the company. “People are going to want reduced ad rates, and that’s going to hurt them,” he said. The WB has tried to bolster its position by offering advertisers additional commercial time. When advertisers buy airtime on the popular Thursday night series, “Charmed,” they also get commercial time when the network’s sister cable station, TNT, airs the same “Charmed” episode the following Tuesday. The plan allows the network to sell the airtime based on the cumulative rating of the show on both runs. “It’s been doing well for us,” said the WB’s Marder, but he was reluctant to be any more specific. Analyst Stuart Linde of Lehman Brothers Inc. said the soft advertising market will continue to hurt the WB along with the other broadcast networks, even if it manages to attract more viewers. He said Disney-owned ABC will have a hard time matching last year’s $4 billion in advertising revenue and NBC could see ad sales drop as much as 15 percent this year. TN Media’s Lazarus predicts ad revenue at all the networks will drop this year by about 6 percent, significant for smaller networks like the WB and UPN whose operations could be severely impacted by even a small decline. Levin said the WB’s revenue drop, due in part to the postponement of the season’s opening after the Sept. 11 terrorist attacks, has hurt. But he would not say how much was lost in potential advertising revenue. David Peeler, president of CMR Media Research, estimated the broadcast television networks lost $313 million just in the week of the attacks. CBS alone reported $85 million in lost ad revenue for that week. Neither Levin nor others would speculate whether the WB would become profitable by next year as the company had been predicting. Linde said it’s not likely the WB would be in the black anytime soon. “I don’t think anyone can predict that. Especially now,” he said. With revenue of $453 million last year, compared to $384 million in 1999, Jamie Kellner, then-company CEO, predicted in February that the network would be profitable within a year, with projected revenue of nearly $600 million. The loss of the popular “Buffy the Vampire Slayer” to UPN in June added to the company’s woes by luring away some top advertisers.

With few exceptions, businesses would be hard pressed to identify much of a silver lining in the economic cloud that has hovered over the nation since the attacks of Sept. 11. Almost every industry is grappling with an uncertain future due, in part, to the airline industry fallout and subsequent acts of terrorism of the biological kind, both against a backdrop of already-present economic uncertainty. But history has shown that war can help nurse a faltering economy back to good health, particularly in the case of businesses involved in the effort. If that’s to be the case this time around, a campaign against terrorism could present not just a silver lining, but a golden opportunity for Sun Valley-based Panoram Technologies. The company holds a patent on a new form of visualization and simulation technology it’s convinced can aid the federal government in its new war on terrorism. To fully understand the technological advancements Panoram has made, first take all you know about how you view the data that pops up on your computer monitor, and chuck it out the window. In the 1980s, Burbank-based Metavision, then run by Panoram President and CEO Theo Mayer, designed a triple-paneled, giant screen for Metavision’s entertainment and theme park clients. Using several overlapping projectors at once, data is viewed either as one seamless panoramic image, or in separate, interchangeable combinations all with integrated multi-media linkups. Mayer later set out to use the same “blended edge” technology, now patented as Video Panoram, to create an off-the-shelf, desktop version of the triple-screen for a PC monitor. After a few false starts he came up with the PowerView 290, which he calls an “information appliance,” that wraps around the user at a 140-degree angle at about 3.9 million pixels of resolution. The development allowed Mayer to leverage Panoram into his own company in 1997. Now, the PV290, along with Panoram’s suite of other visual display briefing and design demonstration centers, is in use in more than 85 countries, with the gas and oil industry as the biggest user. The PV 290 caught the attention of the military about two years ago at a simulation products trade show, and the U.S. Navy’s Space and Naval Warfare Systems Center in San Diego began using it. “That’s when the light bulb went on, really,” said Mayer. “That’s when we knew that this was technology that was finally going to be taken seriously by not just entertainment and big industry, but that it had broad applications for military procedures.” Since its introduction, the price tag on the PV290 has gone from $27,000 to $22,750 a significant drop, considering the high manufacturing costs have kept competitors at arm’s length, according to Mayer. Revenues for the last fiscal year were just over $10 million. Panoram has also designed a rugged, portable version of the desktop unit that sells for $45,000 and can be carried right on to the battlefield and set up by two people in less than 10 minutes. It has the capacity for supporting multitudes of real-time, multi-media platforms in tandem with raw and changeable data that makes it possible to reduce the time it takes to turn intelligence into briefings by about 30 percent, according to Mayer. According to Gary Michael Kann, president of Kann Capital LTD in Century City and a Panoram investor, Mayer’s timing couldn’t be more on target. “The government loves this stuff,” said Kann. He said the U.S. military’s collective budget for domestic use alone of flight and combat simulation products, now at about $1.3 billion, is expected to increase by as much as 11 percent over the next three years. “We don’t know yet, quite frankly, where that’s all going to shake out, but clearly much of that spending is going to go to Panoram,” said Kann. “And that doesn’t include foreign markets, where Panoram has already built up relationships in other industries.” So, over the next few weeks, Mayer will be in Washington to convince governmental agencies that visualization and simulation technologies now being employed by the U.S. military are ready for an upgrade. And, because Panoram is the only manufacturer of the blended-edge, three-screen desktop product, the company appears to have carved out a potentially lucrative niche for itself in a market Mayer is convinced is about to crack wide open. He is hoping for sales of more than $100 million within five years. The bigger challenge for Mayer may be in explaining exactly how the stuff works. But, said Kann, that’s easy. “That’s the secret to their success: specifically taking technology and successfully marketing it,” he said. Mayer said it’s all going to boil down to the slide show. “At the end of the Cold War, we sort of began a slow swim up stream from entertainment to defense,” said Mayer. “But it’s come to fruition in a very short period of time. We first started addressing the military marketplace in June of 2000. Since then, we’ve been shocking people. The game now is we need to expose more government officials to the fact that this technology exists and they need it now.”

Call it the end of an era, officially, sort of. The Voit Cos., developer of most of Warner Center, is downsizing its corporate headquarters in Woodland Hills into what, for all intents and purposes, is a service office. The move reflects the shifting interests of the company to points south and east. President and CEO Alan G. Epstein, hired only a year ago, has left the company, along with longtime executives Bob G. Lumley, vice president for development and construction, and Executive Vice President Jim Muth, sources said. A spokeswoman for Voit on Oct. 25 downplayed the moves, saying the completion of the industrial park on the old General Motors site in Panorama City led to the departure of one construction manager and a project manager from the office. “However, Voit Development Co. is continuing a strong development focus,” said Judith Brower. “The company’s next major projects are in Brea, La Habra and Anaheim, all of which are being handled from the firm’s Newport Beach office. Voit Development continues to be involved in the San Fernando Valley.” Brower would not comment on the departures of the executives, saying instead that the company plans to hire a paralegal and an administrative assistant for the office. However, a number of sources in the West San Fernando Valley real estate community said they regard the remaining employees at the office as a skeleton crew that will largely be charged with overseeing what is the only remaining Voit project in the Valley, the Marvin Braude Constituent Center in Van Nuys. Company founder, Chairman and CEO Robert Voit developed most of Warner Center back in the 1970s. Since then, however, the company has sold most of its properties and focused its attention on development in Arizona and Orange County. The last large development Voit completed in the Valley was the General Motors industrial complex in Panorama City, but the company’s name has managed to remain synonymous with Warner Center and Valley real estate. Now however, many observers reason that, with so little space available for development in the Valley, it would be difficult for the company to remain a dominant name in the region. LNR Shoring Up First Phase While the downturn in the real estate market has not yet resulted in a large-scale drop in lease rates, one landlord is reducing the rental price on a 20,000-square-foot block of space. LNR Warner Center has dropped the rental rates on the remaining space for one of the buildings in the complex under development to $2.35 to $2.50 per square foot, down from about $2.60 per square foot. LNR, which has been redeveloping the Prudential office campus at Canoga and Burbank avenues, has leased most of the space in the first phase of the project, and about half the space in the second phase, which is still under construction. But officials said that, with the market showing signs of softening, they decided to move to lease the remaining space in the first phase quickly so that they can concentrate on the new buildings underway. “If the market weren’t so tight, we probably wouldn’t do it,” said Kevin Read, vice president of acquisitions for Lennar Partners. “But it doesn’t make sense for us to sit on this space and have it be non-income-producing. It’s nice not to have Building A space compete with Building C space.” Building A, a 92,000-square-foot facility to be built in the second phase of the redevelopment, is still commanding rates of $2.60 to $2.70, Read said. The company has pre-leased about half the building to Univision Music Group, a division of Univision Communications Inc., which is taking about 16,000 square feet, and First Union Bank of California, which will occupy about 30,000 square feet. LNR has also begun leasing a retail complex, which will also be part of the second phase of development. Read said he expects to complete three leases shortly and have the 10,000-square-foot retail building completely leased by the end of the year. Construction on both Building A and the retail center is due to be completed sometime next summer. Travel Plans Brendan Tours Inc., an operator that specializes in the South Pacific and European travel, has acquired a 40,000-square-foot facility in Chatsworth. The purchase price for the building, located on 1.9 acres at 21625 Prairie St., was $3.7 million. Brendan, which is relocating from Van Nuys, will double the size of its facility with the move. The worldwide tour operator plans to use the facility for its headquarters offices. About 140 workers will be employed at the site. The deal was set in motion long before the events of Sept. 11 turned the travel and tourism industry upside down. But Brendan officials were cautiously optimistic about their situation. “It puts us in a situation that if things turn around within the next six months, it will be no difficulty,” said Jimmy Murphy, chairman and CEO of Brendan Tours. “If they don’t turn around, we’ll have twice as much space as we need.” Murphy said the company’s business was down about 50 percent in September and October and 25 percent since the beginning of the year. But Brendan Tours has weathered other crises, and Murphy said he is hopeful this too will pass. The real test will come in January and February, the traditional time for bookings to Europe, which accounts for a large portion of the company’s business. “We were around when the Gulf War happened and when we had the bombings in Rome and, if you remember, the killing of the tourists on the Achilles Lauro,” said Murphy. “Americans are resilient travelers. It will turn around.” Jerry Scullin, a broker with Delphi Business Properties, represented Brendan Tours. Nick Gregg and Barbara Emmons of CB Richard Ellis represented the seller, ProLogis. Senior reporter Shelly Garcia can be reached at (818) 676-1750, ext. 14 or by e-mail at [email protected].