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 e - NEWS

June 13, 2003



1. '80s Slogans Target Underage Drinkers

2. Alcohol, Bar Committee Proposed to Discuss Law

3. Push the Courvoisier: Are Rappers Paid for Product Placement

4. How a Thirst for Sex and Outrage Could Mean Last Orders for Alcohol Adverts

5. Busch Offering Boutique Beer

6. Light Drinking Minimizes Diabetes Risk

7.  New Malt Rule Will Kill Market, Says Industry Executive


1. '80s Slogans Target Underage Drinkers


By Megan Hawkins - Register Staff Writer



If you've never done the moonwalk, prepare to be carded.

The same goes if you never walked like an Egyptian, if you don't remember who shot J.R., or if you think a turntable is a piece of furniture, according to posters created for a national anti-underage drinking campaign that made its way to Clive last week.

The pop culture-centered campaign uses trends, movies and music from the 1980s to warn underage drinkers of the consequences they face if they attempt to buy alcohol from retailers. And it's catching people's attention.

"Well, I don't know who shot J.R., but I definitely know the moonwalk," said Nick Speck, 23, of Des Moines as he checked out the posters in the liquor aisle at Dahl's. "I had the red jacket with all the zippers and everything," he said, referring to singer Michael Jackson's "80s attire.

As summer begins, complete with graduation celebrations and outdoor parties, officials say they are dedicated to preventing underage drinking and the dangers that go with it. They unveiled the colorful and amusing slogans Thursday at the Dahl's supermarket on the corner of Hickman Road and Northwest 86th Street.

"We've launched this campaign to promote keeping alcohol out of the hands of minors," said Scott Cottington of the Century Council, the national nonprofit organization that created the campaign. So far, it has been adopted in 69 cities nationwide, and Clive is the second city in Iowa to use the campaign, following Cedar Rapids.

Dan Clute, City Council member, initiated bringing the campaign to Clive.

"We have zero tolerance in Clive and the metro area for underage drinking," he said. "This campaign brings humor to the message and gets people's attention."

"This fits in well with our enforcement and educational initiatives to reduce underage drinking and driving," said Clive police Chief Robert Cox. "Every year there are 120 to 150 alcohol-related fatalities in Iowa, and 20 to 25 percent of them involve people under age 21."

Mayor Les Aasheim said the city chose Dahl's as its business partner in the campaign because the store does a good job carding people who buy alcohol and checking their driver's licenses for birth dates. Dahl's also is the only full-service retailer that sells liquor in Clive.

"Everyone has a responsibility to help prevent underage drinking," said Pete Roth, a Clive police detective who attended Thursday's news conference with Clive officials and representatives from both the Century Council and the governor's Traffic Safety Bureau. "We're all here together to try and curb underage drinking."

Although the Century Council has not tried to measure the impact of its campaign, and may not realistically be able to do so, according to Cottington, the council is confident that the materials it distributes raise awareness if nothing else.

"Retailers aren't the biggest part of the problem overall, but this is an area in which we have some degree of control," he said.

The Century Council is funded by the nation's leading distillers and also offers educational programs for high schools, bilingual materials and other campaigns aimed at college freshmen and parents of middle school students.

Dahl's is the only establishment posting the slogans, but materials are available to any interested business. More information about all of the Century Council's programs and materials is available at www.centurycouncil.org.


2. Alcohol, Bar Committee Proposed to Discuss Law

By Vanessa Miller - Iowa City Press-Citizen

June 10, 2003


A proposed alcohol and bar committee will make enforcement and analysis of a recently passed alcohol ordinance a community effort.

On Monday, Nate Green, president of the University of Iowa Student Government, proposed creating a committee to examine the alcohol ordinance that bans those younger than age 19 from entering bars after 10 p.m.

"The Iowa City Council didn't want this to be a council committee because it should be objective and without bias," Green said. "So I am suggesting a panel of four members."

The members would include Green, a city councilor, a local bar owner and a police department representative.

"The panel is a way to bring in four major interests to form a larger committee," Green said. "The appointees would have the ability to appoint the others needed on the committee."

Green said additional members could include UI administration, representatives with the Stepping-Up Committee, non-bar business owners and landlords. The committee must provide information on the success and enforcement of the city's ordinance to the community, university and City Council.

"It will look at many different sources to gauge whether or not the ordinance works," Green said.

Mayor Ernie Lehman said he liked the proposed committee and thought it could be valuable in evaluating the ordinance.

"The independent committee could be a resource for the council as a measurement of the effectiveness," Lehman said.

Green suggested the committee be formed before the ordinance's Aug. 1 effective date, allowing the group some time to determine what aspects it will assess.

"We want to get the committee formed right away so it can give recommendations as soon as possible," Green said.

In addition to the proposed Alcohol and Bar Committee, city staff will compile statistics on arrests for possession of alcohol under the legal age (PAULA) from Aug. 1, 2002, to July 31 and in the upcoming year beginning Aug. 1.

After the ordinance has been in place for a year, councilors can review the data and compare numbers to help analyze the success of the ordinance, Assistant City Manager Dale Helling said.

Officials with the Iowa City Police Department and City Attorney's Office also will compile data on drunken driving arrests and other alcohol violations to determine the effect. In an effort to gauge whether parties in the neighborhoods increase, officials will track the number of disorderly house complaints.

"We are trying to identify ways to get some reasonable notion of how the law in working," Helling said. "It will be somewhat of a subjective evaluation."






3. Push the Courvoisier: Are Rappers Paid for

Product Placement?


By Gil Kaufman - MTV News: Headlines

June 9, 2003


Busta Rhymes in the "Pass the Courvoisier" video
Photo: J Records


"I'll mention Cheetos because I like them, but if I didn't they wouldn't be in our songs." — Roc-A-Fella's Damon Dash












These days, try putting on a CD by your favorite rapper without hearing an endless series of plugs for Burberry, Air Force Ones, Alizé, Maybach, you name it.

But are hip-hop's ubiquitous product mentions just about artists chronicling their high-rollin' lifestyles, or have the forces of marketing worked their way into your favorite rapper's tunes? What's next, a hit track written about Hummers paid for by the car's manufacturer? Well, maybe.

"Unless someone is paying me a billion dollars or offering equity, we don't play that," Roc-A-Fella Records co-founder Damon Dash said of writing products into a song on request. "That's never come up, because once you get that powerful that someone wants to pay me to do something, I don't need it. I've heard about companies asking [artists] to do that, but it hasn't really happened to us yet."


As it happens, his biggest artist, Jay-Z, doesn't need any help in that department. Jigga is already known for his product-heavy lyrics, but the Roc-A-Fella crew doesn't want to just give it away. With the success of the Roc-A-Wear clothing line and the recent purchase of the Armandale vodka brand, Jay has products of his own to hype (check the lyrics to "All I Need"). Same goes for Puffy name checking Sean John, or the Ruff Ryders giving shout-outs to Dirty Denim, because why give others free advertising when you can help yourself out?

"We only rap about things we like. I'll mention Cheetos because I like them, but if I didn't they wouldn't be in our songs," Dash said.

Back in the day, artists would mention their favorite shoes, clothes or liquor for fun and floss, but it's no secret now that well-placed hype might land you a product endorsement deal, tour sponsorship or, at the very least, a closet full of free gear.

"The public is much more savvy these days about name dropping and promotion," said Lucian James, founder of the brand strategy company LucJam, which tracks product mentions in hit pop songs on its Americanbrandstand.com Web site. Since the site launched in January, Mercedes has taken the lead with 53 mentions, followed by Lexus, Cristal, Bacardi, Timberland and Nike. On the latest Billboard singles chart there are six songs in the top 20 with one or more product references.

James pointed to the Busta Rhymes smash "Pass the Courvoisier" as an example of a product endorsement that changed the way deals are done. Busta's management has said that his massive hit about the cognac brand was merely an artistic choice, but it also helped Courvoisier's parent company, France's Allied Domecq, achieve a double-digit uptick in U.S. sales of the top-shelf liquor. Domecq later reached a promotional deal with Busta's management company, Violator. And Nelly must've known that his homage to Nike's Air Force Ones might land him a shoe deal, which of course it did, with a signature Nelly Nike shoe coming in the fall.

Things were much more innocent back in the day, when Run-DMC unintentionally started the trend with "My Adidas," an ode to their favorite kicks. Before hip-hop became the dominant purveyor of youth culture and fashion, it was a street genre that big business was either unaware of or unwilling to endorse because of its rogue image.

When Adidas execs saw thousands of fans waving their unlaced shoes up in the air at a Run-DMC show in '86, a light bulb went off. The band was offered a lucrative sponsorship deal in the neighborhood of $1.5 million. That same year, rapper Kurtis Blow became the first hip-hop star to shoot a commercial when he passed the mic for Sprite. The floodgates were open, but it would take some time for Madison Avenue to realize that hip-hop was one of the most powerful marketing tools around.

Recently, rappers have been credited with raising the retail fortunes of everything from soda to shoes, the latter thanks to Fabolous and his spots for the RBK collection. Jay-Z's S. Carter sneaker was reportedly one of the quickest selling lines in Reebok's history, marking one of the first times that a shoe by a non-athlete has flown out of stores so quickly. The bigger the star, the more deals, as evidenced by 50 Cent's recent signing with Reebok for a signature shoe (see "50 Cent Can Now Throw Out His S. Carters") and with Ecko for a clothing line.

Is it selling out or selling up? Selling out has long been a concern in the rock world, but the impact of product placement has not hit that genre with the same force. Bruce Springsteen ("Cadillac Ranch") and Prince ("Little Red Corvette") are among the many rock artists who've penned odes to cars, but few artists outside hip-hop so generously sprinkle brand names in their songs, a trend James sees continuing. That's because of what he called a fundamental difference between hip-hop and the rest of the music world.

"Hip-hop is about the here and now, whereas rock and pop songs tend to be more about eternal themes of love and hate," he said. "A lot of current culture is about the things we want and own."

Entrepreneurial rappers such as Puffy have taken it one step further. With his Blue Flame Marketing and Advertising company — whose clients include Versace, Nike, Pepsi, Foot Locker and Bentley — Diddy has further blurred the line between music and merchandise.

"Hip-hop is aspirational and more open to identifying itself with brands," said Blue Flame President Jameel Haasan Spencer. "It used to be cool to not have money when Run-DMC rapped about 'Calvin Klein is no friend of mind,' but now hip-hop is more entrepreneurial."

Spencer echoed Dash's perspective that as long as an artist seems to have a genuine affinity for a product, selling out is not an issue. "When I saw Kid Rock in South Beach and he invited me in to have a beer, there was a six pack of Coors Light sitting there," he said. "He really drinks it. Our artists mention Sean John because they get Sean John clothes every month and they know and like the brand. But when you see Fabolous in a Reebok commercial you know he just got a check, because he wears Nike in his videos."


Spencer said part of his job is listening to Bad Boy releases, finding out what products the label's acts like and trying to create relationships with those companies. An example is an upcoming video from Loon, in which the artist is seen holding a Kyocera cell phone. "I reached out to them and they wanted to promote it. He holds one in the video and now we're looking at what we can do in the future."

Though only a handful of major artists can secure major promotional campaigns, the rush to cross-promote has touched everyone from the Neptunes to such conscious rappers as Common, Rakim and the Roots, all of whom have appeared in ads and promotional campaigns.

An article in October's Fortune magazine referenced an Epic Records memo in which the company offered to place products in lyrics to B2K songs for a fee, later quoting an executive who said the same offer would be extended to "most of our pop acts."

Though that executive would not speak on the record for this story, Spencer said the offer is not shocking, just good business. "The reason why corporations are coming at us is that TiVo can get rid of commercials and you have 900 cable channels, so you don't have to watch their commercials anymore," he said. "That's why they're looking at this as a viable space. Because people [still] watch videos."




4. How a Thirst for Sex and Outrage Could Mean Last Orders for Alcohol Adverts

By Maxine Frith, Social Affairs Correspondent – Independent News

09 June 2003

There was a time when advertising campaigns for alcoholic drinks were based on the thirst-slaking qualities or even the nutritional value of the beverages they championed.

Guinness was "good for you", Heineken "refreshed" the parts that other beers couldn't reach and Le Piat D'or gave the consumer French sophistication. The veracity of such claims might have been open to question, but the boasts now seem charmingly coy.

That was then. Now, like a group of loudmouth lads at the bar, 55 minutes into happy hour, alcopop television adverts have burst on to the market, with an outpouring of sexual braggadocio. But the Government believes the drinks industry has gone too far. The ads, it says, encourage antisocial behaviour and unsafe sex.

In a clampdown, ministers are considering new laws to ban alcohol commercials on television before the 9pm watershed and to end self-regulation of the advertising industry.

Take, for example, one new advertisement, which features a young woman having an orgasm in a coffee shop at the mere thought of her Bacardi Breezer-swigging boyfriend. Another ad from the same campaign is set in a church but themed: "She Bangs!"

Leading figures in the advertising industry are also concerned. The former head of a well-known agency said that drinks adverts were "stepping over the boundaries of taste and decency". Hugh Burkitt, a former member of the Advertising Standards Authority and until last year the chairman of the advertising agency BDB, accused advertisers of breaking self-regulatory codes ­ and said the industry watchdogs were being too lenient.

He warned that abuse of the rules by advertisers and manufacturers could lead to much tighter regulation of the industry. Adverts for drinks from alcopops to the more traditional gin and bitter are all overstepping the marks of taste and decency, according to campaigners. Television, billboard, newspaper and now internet adverts are all under the influence of the brash new culture.

One of the most memorable adverts recently is Greene King's raunchy reinvention of Abbot Ale ­ largely credited with serving up a healthy 20 per cent growth in sales for the pub chain operator.

The Government is expected to publish an interim report on alcohol in the next two months, ahead of its long-awaited Alcohol Strategy, designed to reduce drink-related health problems and antisocial behaviour. During the consultation process, campaigners have pointed to mainland Europe and called for much tighter regulation of advertising. Britain currently has some of the most lenient regulations in Europe governing advertising of alcohol.

There is a ban on television advertising of alcohol in France, while Germany prohibits television commercials for spirits. Ireland ­ the only country with higher rates of teenage drinking than Britain ­ has now proposed a ban on alcohol advertising before 10pm, a move that would essentially end the drinks industry's close marketing relationship with sport.

In this country, television commercials are regulated by the Independent Television Commission (ITC). Alcohol is not allowed to be advertised during programmes aimed at children, and is not allowed to suggest that drinking will increase sexual prowess.

But Mr Burkitt ­ whose agency created the memorable "The French adore le Piat D'Or" wine adverts in the Eighties, said the rules were being broken ­ and watchdogs are turning a blind eye.

Now chief executive of the Marketing Society, Mr Burkitt told The Independent: "If you go back five years there were very few complaints about alcohol. We are seeing more and more now. The ads are stepping over the boundaries of taste and decency."

Mr Burkitt said an advert for Carling, which depicted a woman trailing lager over furniture as a man licked it off, was "extremely tasteless".

He also criticised another television commercial for Bacardi, which showed the footballer-turned-actor Vinnie Jones having his clothes torn off by a group of women and recalled his role as a gun-toting debt-collector in the film Lock, Stock and Two Smoking Barrels. "I don't think it was right to use Vinnie Jones in the Bacardi ads because there was too much of a link with a violent movie and a hardman image."

"The industry is now holding its breath to see what the Government's strategy is going to say. I think some in the industry are beginning to recognise that if they don't get their house in order, there will be a clampdown. Some of the agencies are now adopting a much more responsible and ethical approach to advertising."

But the Government's patience may be pushed still further in the coming months, with the launch of a new vodka-based alcopop that claims to boost sexual performance.

Roxxoff ­ known as the first of the "viagra-pops" ­ will contain herbs used in Chinese medicine which, its manufactures claim, make its drinkers "more frisky". Advertising campaigns will feature the strapline: "We dare you ..."

The manufacturer, Yours Alternatively, which is based in Surrey, says its product will be "the first responsible alcopop" because it will only be sold in pubs and bars, not in shops, where most under-age drink-ers buy alcohol.

But charities say advertisers are using blatant sexual imagery to promote alcohol to the youngest groups of drinkers.

Eric Appleby, chief executive of Alcohol Concern, said: "There has been a general trend in recent years for advertisers to link sex with alcohol in a much more blatant way than before.

"The advertisers are using sexual imagery but pushing the letter of the law by saying that their ads are not suggesting that the products will increase sexual prowess. A lot of them are getting round it by not showing people actually drinking the product, so they can have very sexual images but we can't complain about the ads.

"The fact of the matter is that we have the highest teenage pregnancy rate in Europe and the highest rates of teenage drinking. Huge numbers of teenage sex happens when they are drunk. These ads are just adding to that problem."

Sponsorship of programmes such as Friends (sponsored by Jacobs Creek) which had a huge teenage audience,was also a problem, he said.

"The advertisers and manufacturers seem to have become a lot more brazen while the advertising industry seems to have become more lenient in the last couple of years." At the moment, adverts were getting through that should never have been screened.

"We have always been sceptical about self-regulation, but we would like to see it work. What we need are much tighter regulations over how, when and where people are allowed to advertise alcohol."

But Jean Coussins, chief executive of the Portman Group, an organisation funded by the drinks industry that promotes responsible drinking, rejected the idea of scrapping self-regulation.

She said: "It is not a question of the rules needing to be tightened up ­ the rules are fine. It is a question of whether the regulators are applying the code of conduct rigorously enough. "It is important that producers do rein back a bit. If the industry wants to avoid government interference with its commercial freedom, it needs to go further than just obeying the letter of the law."

The Portman Group had a voluntary code of conduct that regulated how drinks were promoted, she said. Last week, an alcopop called FCUK, from the French Connection group, was withdrawn after the Portman Group ruled it unacceptable.

The Portman Group is still considering the case of Roxxoff.

Alcohol ads that pushed the limits

ABBOT ALE: Greene King's racy adverts for Abbot Ale were credited with helping the brewer and pub operator to a 20 per cent rise in sales last year. Advertising watchdogs received a string of complaints about an advert depicting a woman at the height of ecstasy with the slogan: "Some things get better given longer." One national newspaper refused to carry the image, part of a £500,000 campaign. A second advert showed a blindfolded woman groaning with pleasure on a bed.

SMIRNOFF ICE: The ASA upheld a complaint last year after it depicted two men drinking Smirnoff Ice with two women on their knees. In 2001, another ad was criticised when it showed a man who went with his wife to the airport and pretended to have lost his passport. She boarded the plane while he had extra-marital cavorting.

BACARDI: TV advertisement that uses Vinnie Jones and shows him surrounded by women has been criticised for suggesting that the fact someone drinks Bacardi leads to enhanced sexual attraction. A pose struck by Jones with two bottles of the drink, making him look like an assassin holding two guns, has also been criticised.

CARLING: Controversial TV ad that features a man trailing after his partner and licking beer off the furniture and walls - eventually leading to a scene with her in lingerie. The Independent Television Commission said in September it should not have been shown during daytime World Cup matches. It received 69 complaints.

GORDON'S GIN: Gordon's Gin's employed a couple to play strip chess in the window of Selfridges in Oxford Street to publicise the launch of their campaign in April 2003. The distiller sailed close to the wind in 2000, when posters of a naked woman advertising gin were banned in Ireland because they were too "provocative".






5. Busch Offering Boutique Beer
World's largest brewer aims new product directly at import market

By James F. Peltz - Los Angeles Times


Is this beer for you? Anheuser-Busch sure hopes so. The brewing kingpin has rolled out an upscale beer in select cities to compete against the imported brews whose sales are barreling along in an otherwise stagnant market.

The world's largest brewer figures its Anheuser World Select can tap Americans' thirst for foreign-tasting suds. But it won't be an easy sell, despite Anheuser-Busch's huge marketing muscle.

Convincing fans of Corona, Heineken and other imports to buy a domestic beer of any taste "is a tall order," said Harry Schuhmacher, publisher of Beer Business Daily, a trade publication.

The problem for Anheuser-Busch is that a big part of the imports' appeal is that they're, well, imported.

"Beer drinking is all about image," Schuhmacher said. "High-end imports have done extremely well. Anheuser-Busch has watched this growth and they've largely not participated."

Marlene Coulis, Anheuser-Busch's director of new products, said World Select would change that. She said the new beer, a year in development, meets import fans' desire for "a fuller flavor, more hops and a little stronger of a finish."

But Anheuser-Busch appears to be hedging its bets. The new beer will be sold only in 10 markets around the world.

World Select will be priced in line with imports, which typically sell in Southern California supermarkets for $7 to $10 for a six-pack, compared with $4 to $7 for domestic brands.

For all the appeal Anheuser-Busch says its new offering will have, World Select isn't expected to alter the company's fortunes radically.

"Even if it's wildly successful in those 10 markets, it's not going to be a big driver for them," said Eric Shepard, executive editor of Beer Marketer's Insights, another industry journal. "But," he said, "it makes sense [to battle the imports] and they're going to give it a shot."

Based in St. Louis, Anheuser-Busch has about half the U.S. beer market, and last year shipped 128 million barrels globally, posting sales of $15.7 billion. It sells such mainstream brands as Budweiser, Bud Light and Michelob. The company has 12 domestic breweries; World Select will be bottled in Baldwinsville, N.Y.

Because it holds equity stakes in several foreign brewers, including Mexico's Grupo Modelo, maker of the best-selling Corona beers, Anheuser-Busch has profited from the import boom. Those equity holdings last year generated 18 percent of Anheuser-Busch's earnings of $1.93 billion.

They have helped Anheuser-Busch thrive despite the flat beer market. Its stock has far outpaced the broader market the last two years. The stock closed Friday at $52.63 per share on the New York Stock Exchange.

Total U.S. beer sales last year, at 204.9 million barrels, marked an increase of 11.5 million barrels from 1997, representing average annual growth of only 1 percent to 2 percent. And 9 million barrels of that gain came from imports, according to Beer Marketer's Insights.

Also helping Anheuser-Busch are its huge economies of scale and widespread distribution that make it more efficient; a big advertising budget; and 2 percent price hikes that Anheuser-Busch has pushed through in each of the last four years.

To develop World Select, the company called on 10 of its brewmasters from around the globe. One of them, Greg Suellentrop, said the result is a dark golden, Pilsner-style beer with an aroma that highlights its heavy dose of hops and malt.

"Today's beer drinker is looking for a little more sophisticated beer," Suellentrop said. "They want beers a little 'hoppier,' a little 'maltier.' It's a challenge to meet their constantly changing tastes."

Imports might meet that taste test, but their popularity has grown in large part because their producers excel at marketing the brands, especially with television advertising, said Shepard.

"Beer is still a badge," he said. "There's still brand equity in beer brands, and imports have always had a cachet in the U.S."

That's not lost on Anheuser-Busch. The company is quick to point out that World Select comes in green bottles with embossed labeling. Heineken, a top import made by the Dutch brewer Heineken, also comes in green bottles.

Dan Tearno, Heineken spokesman, said, "They're clearly trying to catch on to something that we've made a great success."



6. Light Drinking Minimizes Diabetes Risk



June 10, 2003


Young women who are light to moderate drinkers - one to two beers a day - have a lower risk of developing adult onset diabetes than those who don't drink at all, according to a study published yesterday.

Researchers at the Royal Free and University College Medical Schools in London and Harvard University based data from 109 690 women aged 25 to 42 - who were enrolled in a study in 1989 and monitored for 10 years. Among the group there were 935 new cases of adult onset diabetes recorded during the period.

The study found that, compared to nondrinkers, women who consumed 1 to 4,9 grams of alcohol per day (equivalent to less than one beer) had a 20% reduction in risk for developing adult onset diabetes. For women who drank 5 to 14,9 grams of alcohol per day - about one beer - there was a 33% risk reduction which rose to 58% for those who drank from 15 to 29,9 grams of alcohol per day, or about one to two beers.

However those who drank 30 or more grams of alcohol per day, or about two to three beers, only had a 22% risk reduction. The researchers said people should not interpret the study results as grounds to drink more and noted that alcohol consumption poses other dangers. The study, published in the Archives of Internal Medicine, said the reason for the apparent protective effect was not known.

It said previous studies mostly involving men found that heavy drinking is a risk factor for adult onset or Type 2 diabetes, while other studies have reported that light to moderate drinking may be protective against the disease. The study said the inverse association was strongest in women who drank beer or wine. – Reuters



7.  New Malt Rule Will Kill Market, Says Industry Executive

 By David Goetz - The Courier-Journal

June 10, 2003


A proposal to include more malt in flavored malt drinks will make the popular beverages taste too "skunky" to survive, a flavorings company executive said.


Requiring that 90 percent or more of the alcohol in malts such as Smirnoff Ice or Bacardi O actually come from malt brewing "will surely kill the flavored malt market," said Robert B. Back, vice president of Flavormatic Industries Inc.


The federal Alcohol and Tobacco Tax and Trade Bureau proposed the new standard after state alcohol regulators complained that most of the alcohol in the drinks comes from distilled spirits' flavorings.


The regulators said they also would consider a less-stringent requirement that at least 51 percent of the alcohol come from malt brewing.


The bureau last week extended until October the deadline for comments on the rule change after lawyers for the E&J Gallo Winery wrote that the company will need more time to test the viability of the new standard by letting its product age.


Gallo produces the Bartles & James line of coolers.


Flavormatic Industries supplies flavorings for some malts, Back said, and he's familiar with the process. Adding flavorings to a true malt base doesn't work, he said, because even the best-brewed malts have a distinctive taste that gets stronger in a matter of weeks, making their shelf life too short.


Most flavored-malt manufacturers use a blend of nearly pure ethyl alcohol and citric acid in their drinks to stabilize their flavor, Back said. There's very little malt base in them.


Brown-Forman Corp., which sells Jack Daniel's Original Hard Cola and Jack Daniel's Country Cocktails in the malt segment, is still experimenting with both the 90-percent and 51-percent standards.


"We have two concerns with the 90-10 formula, taste profile and shelf life," said Brown-Forman spokesman Phil Lynch. "We much prefer the 51-49 (standard) and think it's going to be much easier to set up the right taste profile with that formula."


Brown-Forman is still working on its comments for the government, Lynch said.


Flavored malts have been around for a long time, but state alcohol regulators took notice a few years ago when the drinks started showing up in grocery and convenience stores under the names of popular vodka, rum and tequila brands. At least one of the new malts said on its label that it contained vodka. Temperance forces and opponents of underage drinking were incensed that liquor brands were appearing in beer coolers.


Because they are regulated like beer, the malts have wider distribution and pay far less in taxes than wine and liquor. And they can advertise on national broadcast TV networks, which still decline to sell time for liquor ads. That gets exposure for the parent liquor brands.


Under pressure from the states, federal regulators took a second look at the malts last year. First they banned the use of words like vodka or rum on the labels. Then in March, the Tax and Trade Bureau proposed the strict new rule.


So far three states - Mississippi, Virginia and West Virginia - have weighed in with comments in favor of the rule. "Any standard allowing a higher percentage of alcohol from a source other than the brewing process would create a potential conflict with current Virginia law," wrote Vernon M. Danielsen, chairman of the state's Department of Alcoholic Beverage Control.


Perhaps surprisingly, brewing giants Anheuser-Busch and Miller also support the stricter standard, through the industry's Beer Institute trade group. They were forced to jump into the malt segment with licensed products from Bacardi, Brown-Forman and other distillers after Guinness product Smirnoff Ice took a small but significant share of the beer market.


"The big breweries are the ones fighting to kill this segment," Back said.


Opponents of the rule change cast the issue in terms of big-government regulation and taxation. Most of the 115 comments to date are from convenience-store operators faced with the loss of a popular item. Anti-tax activist Grover Norquist set the tone.


The new standard "will substantially change the taste of the (flavored malts), giving them more of a malt flavor and possibly killing off most of the products," wrote Norquist, president of Americans for Tax Reform. "The loss of (flavored malts) removes another choice from the beverage marketplace and further reduces competition."