Cruise Newsletter - September 2005

Memo - Worldwide will be exhibiting at the Chicago trade show "IT&ME Show" which opens

 its doors on Tuesday September 27 to 29 at the McCormick Place South 

Hopefully we will see you there - Booth #4738

Worldwide was in Toronto at the end of last month exhibiting at the IncentiveWorks Show (the old CMITS).  We have supported this trade show since its inception and have found it to be a productive venue over the years.  Toronto is one of our favorite city's, plus its really nice to catch up with friends and colleagues and enjoy the sights, sounds and cuisine of this cosmopolitan city.

This year we had the pleasure to present our annual Canadian "Sail Team" award to Carlson-Canada.  Presented to the team which has shown the biggest increase of business with Worldwide.  Leon Banossian from Worldwide made the presentation at Carlson's pre-trade show party.  The winning team consisted of (from left to right) Katherine Faubert, Hedy Senz, Leon Banossian, Cathy Zappia, and Lee Ann Marano.  Worldwide thanks them and indeed all our Canadian Clients for their continued support.

This is trade show time of the year - at the end of this month Worldwide will be in Chicago  for the IT&ME Show in force, take the opportunity to visit our booth #4738 (which is located in the first isle to the right at the top of the escalators) and chat with the team. We will have everyone from home office rotate through the show over the three day show period.  For us, the opportunity to meet old friends and clients is well worth the trip.  Anyone reading this who is not familiar with Worldwide's service should take a few minutes to meet the team and become acquainted with our professional, no fee service.

Also on our booth will be Bob Armon.  Bob who many of you know, is the VP of Sales for Christina Cruises.  They are our partner for chartering the exclusive and famous ex-Aristotle Onassis yacht - Christina O.  This beautifully restored "small ship" is a one-off fantasy for those top end programs.

Visit our web-site and take advantage of the reduced rate show entry program - it's always good to save a few bucks.  Trade Show

Editorial -

Guilty By Association
If New York Attorney General Eliot Spitzer has his way, incentive travel rewards for insurance agents could be deemed illegal.

By Christopher Hosford

SEPTEMBER 01, 2005 - -- Insurance incentive planners have enough on their plates without having to worry whether the basic function of their job is legal. But these days they do have to worry, in light of a simmering threat to the entire concept of rewards to insurance agents—rewards that often take the form of gala trips to luxury resorts.

The issue has developed from prosecutions launched last fall by New York Attorney General Eliot Spitzer against several insurance executives and companies for unreported commissions and bid-rigging in selling commercial lines of insurance. Spitzer and others now appear ready to turn their attention to the incentives that are traditionally awarded to agents of personal insurance.

The goal: to put all incentives to agents in the same category as undisclosed—and illegal—commissions paid under the table.

"Many agents feel they are inappropriately under a microscope, under siege, and that their customers now have unwarranted suspicions about their relationships," says Robert Hartwig, chief economist with the Insurance Information Institute, an industry research organization in New York City.

Because of the recent insurance executive prosecutions, that come on top of the avalanche of highly publicized white-collar crime scandals, Hartwig says consumers may begin to suspect that insurance agents are steering them wrong—toward certain insurance policies that have little to do with the consumers' own needs, and much more to do with the incentive trips the agents might win.

"But there is no evidence whatsoever that this takes place," Hartwig insists. "The market is too highly competitive for this to happen." That vigorous assertion may be just a voice in the wilderness if the political pressure remains hot.

The charges brought by Spitzer, and other politicians in Connecticut and California, target the practice of unreported "contingent commissions," whereby insurance companies paid broker companies under-the-table fees to send them clients. Those kickbacks, Spitzer charged, increased premium costs and inserted bias into the process.

Spitzer has won guilty pleas for fraud and bid-rigging from several executives, as well as an $850-million settlement last winter from Marsh & McLennan Companies, the world's largest insurance broker.

But more recently, Spitzer has criticized trips and fees paid to agents and indicates that his investigations are moving toward personal lines of insurance. Adding to the controversy, Consumer Reports magazine has characterized the issue as a threat to individuals, noting recently, "Consumers may also be overpaying for insurance purchased through independent insurance brokerages. Investigators want to know whether agents receive extra commissions for steering business to a particular insurer."

While on its face the issue of contingent commissions may seem unrelated to incentive rewards to independent agents—agents, after all, are expected to be compensated for a job well done—the industry is feeling a ripple effect.

"Obviously this issue requires a lot of attention," says Steve Bova, executive director of the Insurance Conference Planners Association (ICPA) in Chicago. "While our people (planners) are not insurance experts," Bova says, "the issue is how attuned they are on the issues affecting their colleagues." Bova says the subject came up at a recent ICPA board meeting, and thinks it will be addressed at future ICPA meetings.

Alex Soto, vice president of the Independent Insurance Agents and Brokers of America, and president of Insource Inc., a Miami–based insurance agency, also is feeling that heat. He argues fiercely that incentives don't sway agents to sell inappropriate products, because competition is fierce and the impact of incentives on the price of premiums is low.

"What does the customer care if company A is sending me to Hawaii, if I can deliver better coverage for a lower premium?" asks Soto. "Agents are paid commissions by insurance companies. Yes, those companies give incentives for excellence in sales, but also for front-end underwriting and for appropriate client advice. If you decide that the incentive is not out of line—and I believe they are totally appropriate and used in every facet of commerce—then whether the incentive is paid on the basis of a trip or cash is immaterial."

But Soto also feels that the regulatory winds may blow in such a way that, at the very least, brokers will have to disclose to their customers where all their sources of income come from.

Soto's association is working with the National Association of Insurance Commissioners and the National Conference of Insurance Legislators to help frame possible regulations that protect agents. "It may be that the state departments of insurance will weigh in on the agent issue, and some transparency will probably be recommended," Soto says. "But we believe at the core that competition is the best corrector of the marketplace."

Insurance conference planners may have to worry about two possible contingencies. One—the more unlikely scenario—is that incentive trips will be outlawed completely as an illegal form of anti-competitive, under-the-table kickback. In that case, insurance planners' jobs will be vastly scaled back; there will be no further need to plan elaborate trips to faraway resort destinations.

The second, and more realistic, possibility is that a combination of industry self-regulation and regulatory guidance will require greater disclosure to customers about incentives. Planners then will still be able to plan incentive trips, but also will be dragooned into creating training meetings to educate captive and broker agents on how to disclose those incentives to their customers.

"What people care about is when the quid pro quo of normal business begins to operate differently than they expect," says Jill Fisch, securities professor at Fordham University School of Law in New York City. "Bonuses and incentives paid to insurance agents don't usually matter to people. What would matter is if the agent were paid by an insurance company to push a particular policy. There is much ebb and flow in business. What was formerly benign is now under much more scrutiny."
 

New Ships

It is intriguing to see the basic specifications and cost of the various new ships which are on order at this time.  One of the things that caught my attention was the cost per berth which surprised me with both of MSC's two new ships being more expensive to build than any other cruise lines including RCI and Cunard.  This would appear to equate to the cost of the fitting out associated with the additional passenger count. Eitherway, the immortalization period for MSC must be far longer in view of their per diems being lower than RCI's & Cunard.

When one considers the life of one of these ships, especially as cruisers always want to be on the newest ships, the dollar outlay is quite impressive.  The write down alone would be daunting for most of us to imagine.

New Ship Delivered to NCL - Meyer Werft delivered the 93,500gt Norwegian Jewel to NCL Corp. today in the Dutch port of Eemshaven. The handover took place one day ahead of the contractual date. Passengers will board on Friday for two mini-cruises, to Amsterdam and Dover, followed by a Mediterranean voyage on Aug. 10. After a Baltic capitals cruise, the ship sails from Dover to New York, where the naming ceremony will take place on Sept. 14.

Built in 22 months, Norwegian Jewel is the first in a new series of four vessels Meyer Werft is constructing for NCL. The ship is a modified version of Norwegian Star and Norwegian Dawn, with fresh features including a new type of accommodation, 10 Courtyard Villas.

According to the builder, Norwegian Jewel is the world’s biggest Panamax cruise ship, with the highest number of cabins (1,188). Almost 70% are outsides, most with balconies. Powered by a diesel-electric podded propulsion system (MAN B&W Diesel engines and ABB pods), the vessel can operate at a maximum speed of 25.6 knots, ‘extremely fast’ for its size, Meyer Werft said.

Port News:

Olympic boost for cruise in London - Bookings for cruise ship calls into central London and Port of Tilbury are already being taken for the 2012 Olympics Games.  The first request for moorings was received the day after the International Olympics Committee selected London as the ‘Host City’, while others came in during the following week. Further enquires are still being received. The Port of London normally offers a total of four main cruise moorings at Tilbury and in central London, however, the Port of London Authority (PLA) is investigating other locations along the River Thames where further cruise ships could be accommodated during the Games.

‘Winning the Games is excellent news for London,’ said Geoff Adam, PLA head of marketing. ‘We would expect to receive bookings a couple of years ahead but we have seven positive enquires already listed for 2012. At this stage we are accepting all bookings as ’provisional’ and will discuss with cruise companies which mooring would best fit their needs nearer the time,’ Adam told Seatrade Insider.

Existing “fast ferry” commuter passengers services on the river could be extended and developed to provide a rapid transfer service between the ships and the various riverside Olympic venues. The floating terminal exceeded best expectations during last year’s season proving itself to be perfectly equipped to handle the largest ships capable of coming into central London.  This year ‘Welcome’ – London’s unique floating cruise terminal - is providing full transit and turn-around passenger handling facilities for 11 cruise ships at the central London mid-stream moorings at Greenwich and Tower Bridge. This month Seabourn Pride and Vistamar will use the facility.

Two new ships to sail from Port Everglades
Port Everglades will host 41 cruise ships offering more than 2,500 departures during the coming year. The list includes the new Carnival Liberty and Costa Magica, both sailing in for the 05/06 winter Caribbean season. The recently introduced 110,000gt Carnival Liberty, now operating in the Mediterranean, will sail its first revenue cruise from Port Everglades on Nov. 12. (Carnival Legend also operates from Port Everglades) and the new Costa Magica arrives from Europe to start its Caribbean program on Dec. 15. (Costa Mediterranea also sails from Port Everglades).
 

Cruise operations in Cuba will continue, according to Alfonso Lavarello, president of terminal operator Silares Terminales Caribe. Following Cuban leader Fidel Castro criticizism of the cruise industry, saying that ships left their trash in exchange for ‘a few miserable cents.’ Cuba’s Official Gazette published a resolution  in  which it was said the concession agreement with Italy's Silares and Cubanco, its Cuban joint venture partner, was canceled.  That’s not the case, Lavarello told the press. He cited two legal documents, from 1998 and 2002, which grant Cubanco the cruise concession rights until Aug. 6, 2022. Severing those agreements would violate Cuba’s foreign investment laws, Lavarello said.  The existing contracts with cruise lines will be honored, he added, noting that in 2005, a total of 129 calls are booked for Havana, Santiago, Punta Francés and Cienfuegos.

The new Carnival

Worldwide continues to hear - "Carnival is the wrong end of the market for our client" - which in fact these days could hardly be further from the truth.  The "New Carnival" as we have described the new ship product and delivery, is a world apart from the old Carnival.  Carnival Corp has really lifted the product to a new level where in many ways it competes against Holland America in some areas - even occasionally exceeding them in price points as well.  Certainly the older ships are still the product we know from years past - the original "Fun Ships" - but gradually these are being phased out to be replaced by new ships offering every amenity found else where as well as excellent food and service.

As we all know the European taste is in many ways more subdued than the American, take a point in question - Costa Cruises - their ships are delightful and tastefully decorated, but done to the European expectation and as such are more "subdued" in their decor. So it should come as no surprise that Carnival has been slow in making ground in the European cruise market.  That is until the "NEW Carnival" appeared on the scene.

Carnival's Senior VP - Vicki Freed acknowledged that  "Carnival could not have had a full season like this in Europe 10 years ago? No, not at these price points. We didn't have the quality of the hardware and the quality of the onboard experience that we have now."

Carnival's European ship for the 2005 season was the the "Liberty".  Not only delivered on time, but service was immediately up to the line's standards. Agents who tell clients to be wary of ships less than one year old might want to reassess that message when it comes to Carnival.

Liberty is Carnival's sole new ship this year, but Freed says that's not the only reason it was humming from the get-go. "Remember in 2002 we had three new ships enter service, and they were all totally ready," she says. "We have a very experienced, organized team, and we're willing to spend the money to make sure the targets are made. A lot of the staff on Liberty have come from Carnival Valor; they know how to sail on new ships, and that makes a difference."

In a certain sense, the fact that Carnival is succeeding in Europe ties in well with Today's Carnival marketing message. "If you look at our price points versus other major contemporary cruise lines, in many cases people are willing to spend a few dollars more for us," says Freed. "We're not the down and dirty pricing leader anymore."

Freed maintains that Carnival's onboard product delivers more than other brands in the contemporary market. "I just cruised on a premium cruise line, and I have to tell you, our food is equal to or better than our sister company," she says. "They won't like me saying that, but definitely our choice, our variety, even our presentation is better. Look at the Versace dishes we're using; look at the flatware, every single dish that comes out of the kitchen is a work of art, even in terms of placement of the vegetables. It's not just about throwing quantity on the plate, it's about putting quality and making it so eye-appealing that people say, 'Wow.' I think that's what today's Carnival is all about, the wow effect."

Freed says the biggest wow factor in terms of the soft goods is the bedding, a feature which has more often been promoted by premium and luxury lines. "People are sick and tired of flowered bed spreads," she notes. "They want the beautiful white clean look. We even have a pillow menu for our suite guests where they can choose from five different types of pillows, whether it's all feathers or synthetic, hard or soft."
 

Summer in the Tropics

Worldwide was fortunately a short lived victim of hurricane Katrina - our offices lost power late on Thursday evening and happily for us power was restored in the early hours of Monday morning, so in fact we did not lose too many hours.  As some of client might have noticed however, more disruptive forces were at work a week or so before when somehow a virus got into our main communications server and caused havoc.  After 2 days of hard work our technical team was able to rebuild the system, but it was a very difficult period with a number of programs on the final home run.

Generally speaking South Florida cruise lines also got fully back to business on Monday after Hurricane Katrina impacted some land-based operations on Friday. Katrina hit Thursday night as a Category 1 hurricane that downed trees and caused flooding and widespread power losses. Many who tried to reach work on Friday encountered dangerous or impassable roadways.

Fort Lauderdale companies were not as affected as those in Miami. Radisson Seven Seas never lost power so it was business as usual for the staff that could get into the office’ on Friday.  MSC Cruises USA also reopened on Friday, as did Silversea Cruises.

In Miami, Carnival was fully back to business today, as was Norwegian Cruise Line, where everyone was able to get to work. Royal Caribbean/Celebrity offices reopened after staying closed on Friday they did suffer some damage, mostly fallen trees and some damage to the roof.  Oceania Cruises resumed full operations on Monday afternoon and the reservations department made up for lost time with record call volume.

New Orleans and the Gulf Coast, where Katrina packed a powerful Category 4 punch has suffered devastating damage but, it could have been even worse as the eye of the storm jogged east at the last moment moving New Orleans out of the worst winds and rain which hit caused severe damage and flooding as far over as Mobile and places in western Florida.  At this time there is no way of knowing how badly effected the port operations will be and when the cruise lines will be able to return to their New Orleans departures.  Worldwide will be monitoring the situation and advising those of our clients with program operating from there as new comes in.

We are devastated to see the news reports coming in from the area and want to take this opportunity - on behalf of all of us and our clients - to send our condolences and best wishes for a speedy resolution to the many problems our friends and their families are having to live through in the effected area.

Ship news

Hanseatic went aground grounded off the coast of Norway.  The ship, which is operated by Hapag-Lloyd Kreuzfahrten, ran aground near the island of Lurøy, off the Norwegian coast on Sunday. Lurøy is located in the northern part of Norway, 22 kms south of the Polar Circle. The grounding caused a 5mtr hole in the ship’s hull. It is understood that a pilot was onboard the ship when the incident occurred. Hanseatic Capt. Thilo Natke was quoted in the German press, saying that the ship remained stable and that there was no danger at any time to the 161 passengers. All were taken to Bodø from where they flew back to Germany yesterday. Hanseatic will proceed to a shiprepair yard although it has not yet been decided which one. In the meantime Hapag-Lloyd has cancelled Hanseatic’s next cruise which was scheduled to depart from Kiel on August 25

Costa Crociere canceled a Costa Classica cruise after a small fire broke out this morning while the ship was en route to Piraeus. No injuries were reported amongst passengers and crew. The fire broke out in a mooring area on the aft side of the ship at 9:30 a.m. The effects of the smoke and of the fire extinguishing operation resulted in damage to the kitchen where passenger food is prepared, so Costa decided to cancel the cruise.  Costa said synthetic ropes caught fire in the mooring area, causing thick smoke. The blaze was extinguished at 10:05 a.m. by shipboard personnel, according to a statement. ‘The general emergency alarm was not activated and at no time was the safety of the guests, the crew or the ship ever in danger. The 1,585 passengers were disembarked at Piraeus and will return tomorrow by charter flights to Ancona and Venice, the scheduled disembarkation ports.

New Itineraries

Orient Lines adds 25 Europe ports  ranging from Thorshaven in the Faroe Islands to Zadar in Croatia, are highlights of the just-released 2006/07 preview brochure for Orient Lines. Marco Polo will offer varied seven-night cruises in the Eastern and Western Mediterranean, a 10-night Iceland/Scandinavia program and voyages to Antarctica, India and New Zealand.

Passports - once again, and we hate to be repetative.

Are you up to speed on the new passport rules? Full information can found on our web-site.

We strongly encourage you to:

• Advise and encourage your clients to Acquire/Renew Their Passport on every occasion you communicate with them.

• Include passport requirement information in every clients travel document well in advance.

• Send an e-mail to your client database to make them aware of the upcoming passport rules.

• Establish a relationship with a passport processing/expediting service that you use or recommend to your clients. They do they work to make it even easier and you may be able to earn a commission on the service you provide.

• And finally, a U.S. Passport is easy to obtain by visiting one of the 6,000 passport acceptance facilities across the U.S. For more information about applying for a Passport, U.S. citizens may visit www.travel.state.gov or call the National Passport Information Center toll free at 1-877-487-2778 or TDD/TYY: 1-888-874-7793. Foreign Nationals should contact their respective governments to obtain details regarding current Passport requirements and application procedures.

SEA CLOUD - Charter Opportunities available through Worldwide:

Three Sea Cloud dates are available for charter in the Aegean during 2006.

June 1-6, 2006 / Isthmia, Greece - Dikili, Turkey
June 6-13, 2006 / Dikili - Istanbul
August 3-10, 2006 / Kusadasi - Istanbul

Isthmia is about 1 hour from Athen's port city of Piraeus. Dikili and Kusadasi are both about an hour from the airport in Izmir. In addition to all of the many cultural and archaeological wonders of Athens and Istanbul, and the natural beauty of the isles, additional highlights for these cruises could be the Celsus Library in Ephesus and the Castle of St. Peter - now the Museum of Underwater Archaeology - in Bodrum. Their are numerus ruins like the Altar of Zeus that dot Begrama - near Dikili - that span several empires.

Call us for full details...
 

PROGRAM IDEA's

Coming up soon are several sporting events which our clients should be focusing on:

Monaco Grand Prix - this event is held annually in Monte Carlo - call us for ideas, we have already signed two charter contract for 2006.  Due to limited port space it is imperative to move early on any plans you may have for a ship charter.  Group space is very limited also and increases in cost the closer it gets to race time.

Grand Prix Tours - who have the Le Ponant chartered for the 2006 race are already working on their 2006 program and are able to discuss a re-charter or group booking at this stage.  As they sell out the cabins - the opportunity to do something becomes less viable and the cost increases accordingly.   They have a very extensive package which include a cruise, the race, cocktail parties with the drivers et all. They can be reached at (949) 719-3350.

• 2006 date - Sunday May 28

2006 Ryder Cup - This event is being held in Ireland at the prestigious Kildare Golf and Country Club, Straffan, Co. Kildare, between Friday 22nd and Sunday 24th September.  Our client has chartered the Seabourn Pride and will bring the ship into the port of  Dublin with pre & post cruises planned around the event. Call us if you have any clients interested in this very exclusive golf/cruise program. We have now signed a contract for the Seabourn Pride - call us if you have any interest in purchasing a block of staterooms for your group.

Superbowl in Miami 2007

True to form, just as soon as this years Superbowl was over, our telephones started to ring for Superbowl 2007.  Call us for some ideas, we are happy to chat about options and who and what might be available in Miami. 

• We have a client who is chartering a ship for the event and will be breaking the staterooms in various allotments for resale to the corporate market

The America's Cup 2007

Worldwide continues to bring this event to your attention.  We are currently working on programs for some of our clients who recognizes the corporate potential the event holds and the up market image it projects - especially for multi-national corporations.

Check the latest news and race results on our web site

THE AMERICA’S CUP – THE STAGE FOR CREATING LEGENDS as well as a SITE Crystal Award.

For more information contact:

·         Steve Bloss (954) 452-8800, ext. 26 - email Steve

·         Jim Huff (954) 452-8800, ext. 28 - email Jim

·         Leon Banossian (954) 452-8800, ext. 29 - email Leon

·         Martin Dock +44 (0)1794 514336 - email Martin

·         Jim Castle (954) 452 8800. ext.25 - email Jim

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