The Boston Globe from Boston, Massachusetts • 86

D4 THE BOSTON GLOBE FRIDAY, OCTOBER 29, 1999 Raytheon Antarctica pact may be worth up to Defense firm is given notice of strike in Ariz. Who's what, where Recent appointments and promotions THE PITCH Chris Reidy Lynch jogs, stays in pitch By Ross Kerber GLOBE STAFF A DS FOR FIDELITY INVEST-ments that star Peter Lynch have been highly successful in bringing customers to the Boston-based mutual fund giant, Steve Cone, Fidelity's president of customer came PerkinElmer Inc. One of the best-known of this group is Jerri Nielsen, the 47-year-old doctor who spent the polar winter this year stranded at the Amundsen-Scott South Pole station, treating herself for a suspected cancer until weather allowed a military flight to airlift her to New Zealand earlier this month. Antarctic Support's contract ends this year, and Raytheon will now step in. A person familiar with the matter said Raytheon was chosen over five other bidders including Antarctic Support and Kellogg Brown Root of Houston.

Efforts to reach those companies for comment were unsuccessful. Raytheon now hopes to hire most of the incumbent work force into its own operations, which it will begin phasing in on Nov. 1, according to Bob Valentine, a spokesman for the unit that will oversee the work, Raytheon Systems Co. The National Science Foundation contract initially lasts for five years, and is worth $576 million to Raytheon. The company would then be eligible for a five year extension worth an additional $550 million.

By Anne Marie Squeo DOW JONES WASHINGTON Raytheon Co. yesterday said that unionized workers at its Tucson plant served the company with a seven-day strike notice after walking out of negotiations involving a federal mediator. Members of the International Association of Machinists and Aerospace Workers total about 1,800 of the plant's 10,000 workers. Raytheon's Tucson facility turns out Tomahawk cruise missiles and at least a half-dozen others. The Lexington-based firm is the world's largest missile maker.

The two sides met with a federal mediator Wednesday after 95 percent of union members voted last Sunday to reject the company's contract offer and authorize a strike. In one of its more unusual sales triumphs, Raytheon Co. of Lexington has won a contract worth as much as $1.12 billion over 10 years to shuttle scientists, fuel, and cold-weather supplies around Antarctica. Raytheon, which plans to announce the award today, was given the contract by the National Science Foundation. The federal agency sends about 800 researchers to the South Pole and its environs each year, primarily during its warm season, from late October through February.

These scientists are supported by about 2,700 personnel, ranging from helicopter pilots and ski guides to construction and health workers. For the past 10 seasons, most of this staff has been made up of contract employees of Antarctic Support Associates, a services firm based in Englewood, Colo. The company was partly owned by Inc. of Wellesley, but was sold along with other units as part of a recent reorganization in which be Interleaf pins hopes on XML idea cj Pegasystems names president Cambridge-based Pegasystems a provider of customer-relationship management software, yesterday named Richard H. Jones president and chief operating officer.

Jones will report to Pegasystems' founder Alan Trefler, who remains chief executive and chairman. Jones has over 25 years experience with several multinational service-oriented organizations. Recently he was chief asset management executive at Barnett Banks and was chief executive of Fleet Investment Services. He had also been an executive vice president with Fidelity Investments, and a a principal with Booz, Allen Hamilton. Consulting firm picks executives Pile and Co.

of Boston and New York appointed Rick Hooker to president of the management consulting firm, and its subsidiaries. Skip Pile will become chairman and chief executive of Pile and The Communications Collaborative and Agency ComPile. Hooker joined Pile in 1987, six months after Skip Pile founded the firm. He began his career at Ingalls Associates as manager of broadcast services, and in 1984 became vice president and assistant general manager. Also, Pile said that Judy Neer has been promoted from vice president to executive vice president She is responsible for managing the day-to-day business of agency reviews.

Other appointments FleetBoston Financial has named three senior executives. Peter Manning was appointed vice chairman of the corporation, advising on strategic business development issues. Brian Moynihan was named executive vice president for mergers and acquisitions and corporate strategy. Anne Finu-cane was elevated to executive vice president of marketing and communications. Epsilon has named Corey V.

Torrence president and chief executive. Torrence, whose appointment is effective Nov. 1, will also serve on Epsilon's board. Torrence joins Epsilon from Logica where he was president and chief executive. Glamesville.com a Boston database marketer and provider of on-line multiplayer games, has named Paul LaRocca as vice president of marketing.

LaRocca will be responsible for overall branding, advertising, promotion marketing, and corporate GLOBE STAFF PHOTO WENDY MAEDA Interleaf chief executive Jaime Ellertson; its CFO, Peter Rice; Gary Phillips, vice president of E-Content and Barry Briggs, chief technology officer of Interleaf. From its anemic price of Just under 2 per share at the start of the year, Interleaf stock finished at 25 Vi yesterday. BOSTON CAPITAL Continued from Page Dl way back. Interleaf took a flier on a developing technology that has turned out to be hot stuff on the Internet. Extensible Markup Language, known as XML, is now seen as a better way for many companies to publish information on a Web site than the current Hypertext Markup Language, or HTML, used today.

"We bet the entire company on XML," said Ellertson. "But no one in this market even knew how to spell XML then. We did a bunch of analysis, but it was a guess." Good decision, so far. On a percentage basis, Interleaf is by far the biggest gainer among Massachusetts stocks this year, with an advance of 1,129 percent. From its anemic price of just under 2 per share at the start of the year, Interleaf stock finished at 25 yesterday.

Though Interleaf performance is eye-popping based on percentages, the company's stock market value is still only $295 million. Sales remain modest; profits, elusive. View the gain as evidence of how deep a hole the company had been in, rather than any overnight creation of huge value. What happened this year? Interleaf began to sell its first new products, but more importantly, the Internet buzz around XML became a roar. Microsoft president Steven Ballmer now predicts it will one day be seen as the "secret sauce" that propelled Internet content in the later 1990s.

"I think Interleaf stock boost is a result of general investor excitement and awareness of the potential of XML," said analyst Tim Stobaugh of Stonegate Securities. "They've got what we think is a hot new software product that's selling very well. Stories like this can get momentum very quickly, and that's what's going on here." XML allows the author of any document to tag pieces of information as specific corded modest sales of its XML products so far, and its traditional publishing software operation, which is behind big commercial jobs such as manuals at Boeing, still generates most of the company's business. Interleafs second-quarter results, announced yesterday, included just $2.8 million in XML-related business. That was up from $1.6 million during the previous three months, the first quarter of any XML-relat-ed sales.

New blue-chip XML clients such as Intel Motorola Alcatel SA, and International Data Corp. are considered encouraging signs. But Interleafs total sales amounted to $13.6 million, and it lost $1.4 million for the quarter ended Sept. 30. For all its new potential, remember that Interleaf was considered a hot tech company with huge prospects years ago and then slowly fell on its face.

Executives there today say the lesson is not lost on them. "We don't pretend we're anything but a company that's done its homework and put a lot of effort into a new technology area," said Ellertson. "We guessed right We're a company that has had a sometimes ugly legacy with a new technology and an early lead. We're nowhere near done." marketing and development, said yesterday. Nearly all Fidelity ads include a "call to action" that urges consumers to contact the company by either visiting its Web site or calling a toll-free telephone number.

After Fidelity aired ads pairing Lynch with Lily Tomlin and Don Rickles, the number of calls and Web visits was up tenfold, compared with results from earlier ads that didn't use Lynch, Cone said. "The industry pundits never liked this campaign, which I could care less about," Cone told a breakfast meeting presented by the Advertising Club of Greater Boston and sponsored by Time Inc. "Our employees love it. Our customers love it." The ads were created by Hill Holliday Connors Cosmopulos of Boston; the current tagline: "We help you invest responsibly." The financial services industry is undergoing big changes. In early 1997, only 7 percent of Fidelity's retail trades were made on line.

Now the monthly figure can be 70 percent, Cone said. Such changes are driving ad spending. Over the next three months, the industry will spend $750 million on marketing, the same amount it spent for all 1997, Cone said. In 1988, the financial services industry spent $1 billion on advertising; in 1998, that amount was $3.8 billion, said Time's New England manager, Donald R. Jones, who introduced Cone.

All that clutter means Fidelity television ads have to be more than a bunch of "homogenized Kodak moments," Cone said. To differentiate Fidelity from the crowd, ads need to be entertaining and not preachy, he said. They need to have personality. And sometimes they need to be funny. For personality, Cone turned to Lynch, Fidelity's most famous stock picker.

During a question-and-answer session, a member of the audience asked how the Lynch ads had been received by Fidelity chairman Edward C. "Ned" Johnson III, someone whose public persona seems to suggest a man of no-nonsense reserve. 'To Ned's credit, he loves this stuff," Cone said. "He's very engaged in advertising and promotion." Some of Fidelity's newer ads star longtime customers. Shot in black-and-white and largely unscripted, the ads feature a Filipino immigrant, a widow with children, and a World War II veteran.

In separate ads, the customers tell how they had overcome challenges and accumulated wealth, in part because Fidelity had given them the tools to "invest responsibly." Most ads, though, will continue to include Lynch, the "common element" that holds the campaign together, Cone said. As a pitchman, Lynch was described as a real trouper. In one spot, he had to jog on a bucking treadmill, which served as a metaphor for an up-and-down stock market. Because Lynch has a bad back, a double was hired for the five hours of jogging required to capture a few seconds on film. But like film star Jackie Chan, Lynch insisted on doing his own stunts, and the ruinous expense of coiffing his double with a doppelganger haircut went for naught, Cone said.

With Lynch growing older, there's a risk to making him central to Fidelity's ads, an audience member noted. Cone said plans call for ads to star Lynch for many years to come. Said Cone: "We'll use Peter as long as he's able to sit up." Espaiiol.com a Wakefield-based on-line retailer that sells Latino books, music, and videos, as well as Barney dolls that speak Spanish, has just launched a $10 million ad campaign that will air in such media markets as Chicago, Houston, Los Angeles, Mexico City, New York, and San Juan. Created by Nazca Saatehi Saatchi, the ads focus on the importance of the letter in the Spanish alphabet, a completely separate letter from the standard-issue Delete the accent mark known as the tilde from over an and the meaning of a word changes. Ads for Espafiol.com make humorous word plays that result when people mix up and something English-only speakers often do, said Kyle McNamara, Espanol.com chief executive.

The letter is the "official stamp of authenticity, and the accepted cultural icon for the Latino generation," said Espanol.com, which opted to locate near the Hub because Internet-savvy workers are readily available. Many personal computers and search engines can get confused by and As a result, the company's Web address is simply Espanol.com with an ordinary McNamara hopes someday the Internet world will recognize the distinction. "That's something we're working on," he things. In the case of this column, the headline, Boston Capital logo, photo, caption, chart, and story itself would all be identified individually by XML tags, rather than being lumped together as one big blob of information on the Internet. That level of identification is expected to dramatically improve communication between Web-based information systems run by different people such as vendors and customers.

XML proponents also point to the language's superior ability to send Web-based information to all kinds of equipment besides computers on a desk, including cellular phones, personal digital assistants, and pagers. Soon, they say, there will be as many of those "other" types of devices accessing information on the Internet as there are personal computers doing so today, and XML will become critical for them to work properly. Interleaf carved out a place for itself in a corner of the XML world known as content management. Its BladeRunner product, which debuted earlier this year, turns material written on Microsoft's Word software program into XML. A second product, introduced just last week, helps send XML material to people using wireless hardware.

Despite all the buzz, Interleaf has re Hotels are the next big piece in the convention center puzzle fault jolted the capital markets. Susan Elsbree, a spokeswoman for the Boston Redevelopment Authority, noted that the city has a number of other hotel projects in construction or moving forward. "We've far and away exceeded our goals of bringing hotels on line" or having them moving through the development pipeline, she said. While acknowledging progress on that front, the Convention Center Authority is focusing on the need for convention hotels. These are big buildings, preferably near the convention hall they serve, that can reserve rooms by the hundreds for conventioneers.

Authority board member Larry Moulter put it this way: "If you build it, they will come if you give them a place to sleep." HOTELS Continued from Page Dl was termed "an enormous problem" yesterday by a participant at Tuesday's discussion, which he said stopped just short of being heated. "You've got this huge building being developed out there, and all you have is the John Drew hotel," he said, referring to the new Seaport Hotel. The Convention Center Authority is preparing to pick a developer for a convention hotel that would be attached to the new center. Three teams of national hotel companies linked with local developers are competr ing for the opportunity. The authority plans to announce its choice of a developer Nov.

19. Peter Bassett, an authority board member working on the selection process, said he thought "the big players" in the hotel business want to see what happens on the so-called headquarters hotel before making plans. Meanwhile, smaller projects are advancing in Boston. Intercontinental Cos. is buying the site of the former Dini's Seafood restaurant at 90 Tremont St.

and plans to break ground there next March for a 19-story hotel, In-tercontinental's chief financial officer, Paul Palandjian, said yesterday. The company is preparing to convert an office building at 1 Court St to a 162-room hotel on a similar timetable. Palandjian said his company recently closed an $80-million private equity fund that will allow it to proceed despite the stringent financing terms that have hampered hotel development since Russia's August 1998 debt de Delta Air reportedly to rebuild Terminal A By Matthew Brelis GLOBE STAFF Unlike many other airports, Boston has no dominant carrier, he noted. "There are four airlines here with a substantial market share," Mullin said. Mullin fielded several questions from employees about morale.

Many pilots are upset about their pay; in a 1996 contract they say they gave up $1 billion in concessions, while the airline has made annual profits of $1 billion for the last two years. Shareholders rejected two pilot-initiated shareowner proposals: to peg executives' performance-based compensation to employee satisfaction, as well as financial measures, and to limit to $2 million the amount of severance pay an executive can receive without shareowner approval. After the meeting, the board of directors declared a cash dividend of 2.5 cents per commrn share, payable Dec. 1 to shareholders of record Nov. 10.

is built, and then half would be torn down while part of the new terminal is built Eventually all the old terminal will be replaced with the new terminal, much of which will sit on the area that is currently metered parking. In its heydey, when Eastern Air Lines used Terminal there were 14 gates with jetways and 12 parking positions on the tarmac near the terminal where passengers could board airplanes by walking to jet stairs. Currently, there are 12 gates with jetways and three positions for planes to park. Governor Paul Cellucci and US Senators Edward M. Kennedy and John F.

Kerry are expected to be at the tails of the terminal project, but told reporters after the meeting that the airline is committed to beginning service to Dublin, Manchester, Paris, and Rome "as we develop Terminal Sources said that permitting and environmental reviews for the new terminal could take 18 months to two years. A new facility, which would have 18 to 22 gates with jetways, would open around 2004, the sources said. While plans are not final, officials envision the terminal as having a satellite component near Harborside Drive, with several gates reached from the main terminal by a moving sidewalk running underneath the tarmac. Th existing terminal is expected to be used until the satellite facility Delta Air Lines will announce today that it has agreed to build a new Terminal A it Logan Airport that is expected to cost- about $400 million, about $65 million of which will be paid for by the Massachusetts Port Authority, sources said. is committed to the city and the region, and we are making every effort to be-an integral part of the plans for renewal and positive growth at Logan," said Delia chief executive Leo Mullin at the airline's annual shareholder meeting, which was held in Boston.

Mullin would not elaborate on the de.