The trade show industry is being roiled by a new policy being implemented by high-technology trade show producer IDG World Expo. Beginning with its LinuxWorld Conference & Expo in August, the company will require exhibitor-appointed contractors (EACs) to hire labor for installation and dismantle (I&D) of exhibits not directly, but through the designated general contractor, Freeman Decorating Company, which IDG World Expo is calling a "subcontractor." The policy will then be rolled out at IDG World Expo’s other shows: Macworld Conference and Expo, BioITWorld Conference & Expo, and COMNET Conference & Expo.
"Some shows have done extremely well in this recession, but tech shows have been getting decimated," says Charlie Greco, president and CEO of Framingham, Mass.–based IDG World Expo. "Our exhibitors have been complaining about costs and they look to us to help. One way to do that is to reduce labor costs, especially I&D costs."
As Greco sees it, "There are a lot of layers between union labor and the exhibitors using the labor. Each layer marks up the labor, and the final charge can be astronomical. We have to eliminate some of these middlemen. We’ll control the first markup so it won’t be disproportionate." The result, he maintains: lower exhibiting costs.
Not so, says the Computer Event Marketing Association (CEMA), many of whose members exhibit in IDG World Expo shows. CEMA has issued a statement expressing its concern that this policy could actually increase costs by creating a monopoly and could set a precedent for other shows. "The EAC has to go through Freeman to get local labor, so they’ll have to mark it up," says CEMA president Marilyn R. Kroner, marketing communications manager at Benchmark Storage Innovations, Boulder, Colo. "Who’s going to make money on this? Freeman and IDG—otherwise they wouldn’t be doing it."
Kroner says CEMA is urging IDG World Expo to reconsider. In addition, "We’ve placed a call to action to all our members, and we’ve tried to get them to go above Charlie’s head to Patrick McGovern [chairman of parent company IDG] and Kelly Conlin [IDG president and CEO]."
IDG World Expo is also butting heads with EACs. Says Greco, "We don’t understand why, if an EAC is doing nothing with labor but contracting it, there’s such a huge markup." Any EAC that says the new procedure will increase costs "is saying it won’t reduce its charges proportionately."
Meanwhile, Jim Wurm, executive director of the Exhibitor Appointed Contractors Association (EACA), based in Bend, Ore., comments that "I’m not sure Charlie is that familiar with how labor works." But Wurm can’t really say much more because of the litigation—IDG World Expo is suing EACA.
Greco explains that when IDG World Expo sent RFPs to EACs and general contractors for the labor subcontractor role, "We didn’t get as many returns as we’d like because EACA urged its members not to respond. But it’s against the law for an association to urge a boycott." So IDG World Expo has filed a complaint in U.S. District Court in Oregon, seeking damages for "tortious interference with prospective economic relations, defamation, and tortious interference with contractual relations."
Stay tuned.—Rayna Skolnik