The Palm Beach Post from West Palm Beach, Florida • Page 57

SUNDAY, AUGUST 16, 1987 The Palm Beach Post SECTION BUSINE Average Top Mechanics Wages Airline deregulation war a battle for wages, profits 10 reasons why there's life left in the market Majors Nationals, 1975 to 1987 ton NEW YORK Ten reasons why the greatest bull market of our lifetimes is not yet finished: (1) Nobody believes it. Skepticism pervades the financial press, as it has throughout the five years in which the market has more than tripled. Analysts have sounded notes of "caution" and "prudence" so often that I figure their followers must now be 183 percent in cash. This is not the of operating subsidiaries and even bankruptcy court. In the aftermath of deregulation, pay scales have tended to swing wildly.

From the advent of deregulation in 1978 until the air traffic controllers' strike in 1981, wages followed their traditional increases. With the heavy losses of 1981, however, "concessions" became a common term in labor negotiations. Wages still inched upward, but those increases got smaller as time went on. Between 1978 and 1983, average compensation increased by about 7 percent per year, Please see AIRLINES7D By KEN IBOLD Palm Beach Post Staff Writer The re-election of Charles Bryan as president of Eastern Airlines' machinists union has sent a strong signal throughout the airline industry: The real battle is yet to come. The deregulation of the airline industry, while it brought lower fares for travelers, has also shaken the traditional relationships between labor and management.

The falling revenues resulting from fare wars and the costs associated with a spate of mergers are forcing management to streamline operations. For most companies, that has meant insisting on wage concessions from unions. It has led to "two-tiered" wage scales, creation 1 15- 11-iiiilji 10- a i i i 1975 78 80 83 85 87 Source: AIR Conference mood in which bull markets end. (2) Foreigners still view U.S. stocks as one of the world's super bargains.

Price-earnings ratios that seem steep to Americans look cheap to the Japanese. When the British market faltered this summer, the rush to change pounds into dollars nearly caused a tidal wave in the Thames. Louis Rukeyser jir '-i 1 Of Kx I if i 1 i i I i hi SHERMAN ZENTStaff Photographer WFLX directors Tricia Prentis, Joe Koff and Lois Kwasman are joined by station mascot Firecracker. Independent Channel 29 tests limits of the airwaves Seas change for pirates of software Producers abandon locks': in favor of stronger laws By WILLIAM HOWARD Palm Beach Post Staff Writer i Computer software with built-in copy protection may soon go the way of the manual typewriter and the rotary dial telephone. Despite hundreds of millions in lost sales because, of piracy each year, fewer software companies are shielding their creations with program schemes that prevent copying.

Instead, they are relying on the same federal copyright laws that protect authors of books, songs and movies. ADAPSO, a Virginia-based software trade assocw ation, estimates worldwide theft of software cost the industry an estimated $1.3 billion between 1981 and 1984, and another $800 million in 1985. Most of the 200 software packages for personal computers that bear the IBM name now come without copy protection "locks," said Scott Brooks, an IBM spokesman in New Jersey. In April, IBM began offering the right to copy its software as a cheaper alternative to buying complete software packages. The new terms are for business customers who want to make 20 or more copies without buying additional copies of instruction manuals.

Lotus abandons copy protections Lotus Development creators of the 1-2-3 spreadsheet program that has sold more than 2 million copies, still uses copy protection schemes on that program. Lotus estimates that two pirated copies of 1-2-3 are in circulation for every one purchased. But none of the 15 new Lotus programs introduced last year were copy protected, said Adine Deford, a company spokesman. Lotus removed its key disk requirement for spreadsheet software two years ago. "We are recognizing the trends in moving away from that," she said.

The trend has spread into South Florida. Barrington Systems Inc. of Pompano Beach, developers of a microcomputer programming language called Clarion, used a copy protection hardware device for its system when Clarion was released last summer. By October, Barrinton had removed the copy protector from its eight-disk Clarion package, said Tom Garrett, vice president of marketing. Sales improved after change Garrett and other Barrington executives figured their software would sell better without the customer-aggravating copy protection device.

They were Sales improved after October, and Garrett says he doesn't think the lack of copy protection will significantly damage future sales. Managers at Proximity Technology a software company in Fort Lauderdale, decided not to install copy protection locks on the Merriam-Webster electronic thesaurus recently released for use on personal computers. "The biggest problem is copying the product on your hard disk, and a lot of people are doing that now," said Roy Semplenski, Proximity's vice president of marketing. Despite valid uses of duplicate copies, software industry associations say overseas pirates mass produce their creations for sale in bootleg stores, especially in countries where copyright laws may not be as strict as U.S. laws.

Please see S0FTWARE8D (3) Americans are gaining confidence in their own economy. Though pessimism remains fashionable for politicians, the message of an array of objective recent reports is that things are getting better. The progress is indisputably slow and uneven, but even that helps by limiting the possibility that the government will suddenly slam on the brakes. Paul who? (4) The monetary background remains positive. The jittery folks who assured us that world markets couldn't survive the resignation of Paul Volcker as Federal Reserve chairman now are faced with explaining to their clients why new records have been set since the appointment of Alan Greenspan.

(5) Corporate profits are heading higher. The dollar is dramatically cheaper than it was a couple of years ago, and this is helping U.S. exporters. More fundamental improvement has come from corporate streamlining, induced both by recent recessions and by the threat that the fat and lazy will face hostile takeover bids. Wages are surely due to rise, but less rapidly than prices.

Technical position in strong (6) The market's technical condition is remarkably strong. Rather than roaring recklessly ahead, as many suggest, stock prices have been regularly self-correcting. The self -designated "smart guys" sold heavily every hundred points; advisory sentiment grew more negative during several recent rallies (always a good sign for the bulls), while premiums on stock-index futures withered and "prudent" people raced to buy an unusual number of "puts" (options that make money when stocks fall). The Wall Street Week Technical Market Index would normally be near a sell signal after so long an advance; instead, it actually has gained strength because of the heavy pessimism that abounds. (7) Alternative investments are relatively unattractive.

Imagine what the Persian Gulf crisis would have done to the price of gold in 1979. This year, the impact has been notably muted. Real estate, savaged by the new tax law, is languishing. And who needs Chinese ceramics when you can make money in American companies? (8) "Overvalued" is in the eye of the beholder. One of the most common cliches reverberating throughout the decade is that stocks have become "grossly overvalued." Maybe.

Only hindsight will ever tell us that. But one statistic may help: Boil away the inflation, and you find that the real level of the Dow Jones Industrial Average, even now, is more than 20 percent below where it was in 1966 in a much smaller economy. A solid blue-chip advance (9) The froth is not yet rising to the top. From the start, the great bull market of the 1980s has been led by solid blue-chip firms. We don't yet see the phenomenon of every new stock ending in "-x" or "-onics" quadrupling within a week of issue.

Indeed, small companies are still relative laggards. That usually reverses before it's time to start sounding taps. (10) We're still climbing Wall Street's wall of worry. When euphoria replaces concern, when we start hearing that all the economy's problems are behind us, when your neighbors can't wait to tell you that the 23-year-old whiz kid at the local brokerage will triple your money by St. Swithin's Day, then look out.

Meanwhile, expect sudden and sickening "corrections" from time to time, but don't be scared away by people who can't recognize the bull of the century when he comes snorting jiiiipmnuninpiim h322l IVi nil 1 pcniMv res 1 1 1 lb By ELISA WILLIAMS Palm Beach Post Staff Writer RIVIERA BEACH After nearly five years, independent television station WFLX-Channel 29 is still the feisty new kid on the broadcasting block. It's the station that's constantly testing the waters pumping uncut movies, wrestling, condom ads and Bedtime Movie Girls into South Florida living rooms, and occasionally catching flak when the community thinks it has gone too far. While being controversial has raised some eyebrows, it also has piqued interest and allowed Channel 29 to carve a niche in an intensely competitive industry where viewer options are increasing and advertising revenues are softening. "Our whole approach has been more aggressive. It had to be, or people wouldn't know we were here," said Lois Kwasman, marketing director.

The name of the game for an independent station is offering alternatives for both advertisers and viewers, and WFLX has managed itself accordingly. In a predominately older market, Channel 29 gears itself to 18- to 49-year-olds; other stations tout local news coverage, WFLX offers comedy; networks promote their news personalities, Channel 29 campaigns with a bird a vibrant red macaw that makes its home in their station on Blue Heron Boulevard. Knowing what alternatives to offer requires research and constant contact with the community, said WFLX General Manager Murray Green. Recently, the station launched a survey to get the last word on whether viewers preferred cut or uncut films, and Green said the channel plans to run a feature show to answer viewer mail. "Our standards are guided by the community," Green said.

"We gauge their reactions by the phone calls and letters we receive it gives us a feel for what they'll tolerate and what they won't." The station also has to make judgment calls for advertisers, making sure that ads for a family-oriented company don't back adult programming like Forty's or Taxi Driver. i General Manager Murray Green: 'Our standards are guided by the "We don't put advertisers where they don't fit," Green said. Determining community standards often requires walking a fine line and learning by trial and error. Violence and profanity generate more negative reaction than sex, Green said. One of the worst responses the station received was from a promotional spot for Terror in the Aisles, a movie that features a potpourri of horror scenes.

Green said the promotion, which aired in the afternoon, contained some extremely violent takes and the station received several calls Please see CHANNEL 295D down their garden path. For these people are truly experts only at bum steers. Louis Rukeyser is a syndicated columnist, and host of "Wall Street Week." Marconi taking first step out of red ink Coming Monday A BIRD'S EYE VIEW Aerial photography is part art, part science, and a vital part of the way South Florida does business. In an area with rapid growth, it often is from the air that man's best-laid plans take shape. IN BUSINESS DAY ONE Inside Business SHOULDERING THE BLAME When a jet crash killed 520 people in 1985, it marked the end of a career for JAL President Yasumoto Takagi.

Following a deeply rooted tradition, Takagi resigned to avoid disgrace for the airline. STORY, 9D By WILLIAM HOWARD Palm Beach Post Staff Writer Struggling Marcom Telecommunications a West Palm Beach-based seller and installer of business telephone systems, has acquired 1,500 new customers and expects to post a modest profit for the quarter ended Aug. 31. If the company performs according to its forecast, the profitable quarter would be Marcom's first step out of red ink since the company went public in 1985. "We believe we've turned the corner to profitability in this quarter, and we believe we'll have significant profit in the fourth quarter of this year," said Ronald J.

Levy, Marcom's senior vice president and general manager. Like other companies in the competitive telephone interconnect business, Marcom sells, leases, installs and services private branch telephone systems to businesses and institutions. Marcom held the largest local business customer base in Palm Beach County in June, when it acquired an additional 1,500 accounts in Miami, Jacksonville and Fort Lauderdale from PABX Systems formerly ITT Business Communications Corp. The acquisition, finalized Aug. 7, expanded Marcom's customer base to about 5,500 accounts, a 38-percent increase.

Marcom also has expanded its sales force from eight in February to 24 this month, Levy said. Even if the company has some profitable quarters, Levy said he expects Marcom will post a $233,000 loss for the fiscal year that ends Feb. 29, because of hefty losses. For the past two years, stock offerings, loans and cutbacks have kept the company afloat, according to Marcom's 10-K annual report filed with the Internal Revenue Service for the fiscal year ended in February. Highlights include: Please see MARCOM9D TAX HELP 4D MARKET REPORT 10D ALAN ZLOTKYStaff Photographer Levy shows some of the business phone will put Marcom back on track to profitability.

Vice President Ron systems he believes.