That’s spread out among sales from Apple’s App Store, Barnes & Noble’s Nook and the Zinio digital reader platform. “Now we’re going to get a fourth distribution channel tomorrow,” says Hearst president David Carey, without ever saying the word “Amazon.”

So what does that mean? Because digital numbers aren’t uniformly reported yet, it’s a little hard to figure how that compares to the rest of the industry.

Earlier this summer, for instance, Conde Nast put out a release announcing that it had distributed 242,000 digital copies in the six weeks after it started selling subscriptions via Apple’s App Store. But 136,000 of those came from print customers who got digital copies for free with their subscription.

[UPDATE: Conde offers some updated numbers: It says its monthly digital circulation is now 500,000; 225,000 of those are digital-only subscribers, with the rest getting bundles.]

And in Hearst’s case, the publisher is stressing that all 300,000 of its downloads were tied to a payment. Because unlike its peers, it doesn’t offer print/digital bundles.

Another way to look at it: Hearst sells yearly digital subscriptions for $19.99 a year. Since some of those download numbers come from individual sales, each monthly digital unit represents annual revenue of $15 to $20, according to people familiar with the company’s operations. In other words, Hearst’s digital editions are now on an annual run rate of $4.5 million to $6 million.

And yet another way: Oprah Winfrey’s O magazine, one of Hearst’s most popular titles, sells about 2.5 million copies a month.

So this is still smallish stuff. But it is new stuff, and that’s encouraging for an industry trying to ease into the digital world without cutting off its legacy business.

Meanwhile, it will be interesting to see if Amazon’s tablet buyers behave like iPad owners or Nook/Zinio users. While most of the digerati have focused on digital magazines on the iPad (guilty), Hearst has done best so far on the Nook and Zinio, both of which offer what digerati used to dismissively refer to as “glorified PDFs” (guilty again).

Then again, those platforms also generate more sales for Hearst because the publisher sells all of its 19 titles on those platforms. So far it has sold just 3 titles via Apple. What about Amazon?

Carey again declines to say the word “Amazon” out loud. “But for any future e-commerce opportunities, stores that we would go into would get everything,” he says. Do your own math there.

Apple’s iPad success and the imminent release of new application distribution platforms from Google and other software companies threaten another seismic shift for publishers that may have far greater impact on their business models than the growth of free media on the web. Devices like the iPad offer consumers a rich reading experience and offer publishers even more targeted advertising, but the revenue tradeoff as publishers navigate the path from print to this new world is lopsided–and not in a good way.

While we all enjoy browsing publications at newsstands, over 90 percent of the circulation of U.S. magazines is delivered directly to consumers through the mail. The data and cross-marketing opportunities that these direct customer relationships provide to publishers is the fundamental underpinning of their business model.

Data informs advertising in magazines and allows for better targeting. It provides for the sale of ancillary products like books, videos and special issues. It allows multi-title publishers to solicit new readers across their enterprise. Even competitors agree to exchange lists because it benefits the industry by building more magazine readers from a pool of customers who already enjoy receiving their publications through subscription rather than by single copy purchase.

Without direct access to customers, publisher revenue will decline sharply and the publications that we depend on for in-depth reporting, news and entertainment will risk a final digital Armageddon.

Should we care? Why can’t the publishing industry just leave the world of messy ink and rural route delivery? Can’t it pivot to a less costly distribution model where customer ownership isn’t as critical?

Unfortunately, even if we assume that publishers retain their customers, there are extraordinary business challenges in transforming today’s print consumers into exclusively digital readers. And publishers can’t afford to relinquish their direct connection to readers without a more attractive economic model than the digital publishing world presents today.

Here’s why:

1. The Advertising Model Won’t Pay.

   Magazines are a wonderful advertising medium. Among the top fifty publications ranked by advertising revenues, each copy of paid circulation generates a pass-along audience that averages seven readers. Those seven readers factor heavily into advertising rates, and provide a significant revenue multiple to be weighed against the editorial, marketing, printing and distribution costs of delivering a copy to the consumer.

   What happens to this audience with a digital magazine? If a publisher wishes to be paid for its distribution, it will likely set entitlement requirements that discourage free circulation of its products. Even with integration of social networking tools to enable article sharing, publishers won’t generate more than 1.5 or two readers per copy. So the advertising revenue per circulation unit will fall due to the fact that fewer people see the ads. Even to remain constant, advertising effectiveness per copy would have to increase over four times to make up for the audience decline from seven to 1.5 readers per copy.

   Of course, most publishers believe these new digital magazines will have wonderful consumer engagement qualities that will result in a higher value being placed on their advertising. They believe digital ads will be better targeted and more efficient than print at delivering the right message to the right reader. But will that value be four times the value of print today? Not likely.

   Some argue publishers must cast their lot with free content and endeavor to survive with an exclusively ad driven model. But we need to remember the lessons of the web for most publishers. Even with the powerful reach the web provides, The Economist, The New York Times, The Wall Street Journal, Sports Illustrated and Vanity Fair would fail without the significant vote their consumers make every month by making a direct payment to the publisher.

   So editors and consumer marketers will bear a larger burden in this new mobile reading world. They’ll need to increase the revenue from consumers. And one could argue that this is a good thing, redressing the imbalance of an industry that has been too highly leveraged on advertising. But for the consumer stream to become more valuable, one of two things must happen: either the demand for magazines must rise, or the cost of distribution must fall.

2. A 30 percent Cut to the Store Isn’t a Great Deal.

   Isn’t selling your magazine through an app store and receiving 70 percent of the revenues a great deal? After all, magazine subscription agents and newsstands don’t return anywhere near that amount to publishers. But this is argument misses an important point. In iTunes and the Android Marketplace, there’s virtually no merchandising of magazine products. A magazine app must swim to the top of several hundred thousand other applications. And even in the context of a dedicated magazine store, the publisher won’t control featuring. The value of the brand must pull the consumer through to the purchase. And brands are expensive to build and nurture. So the publisher will continue to bear a high marketing cost to ensure enough sales for a stable level of circulation, just as they do today in the offline world. These marketing costs would certainly erase any advantage that a 70 percent cut would provide over the conventional agent model, particularly if the publisher cannot capture information on the customer and determine an effective ROI against their marketing expenditures.

3. Margin Must Come Before Marginal Cost.

   What about the fact that there is virtually zero distribution cost? Well despite the problems of the U.S. Postal Service, the cost of printing and distribution represents a relatively low percentage of publisher expenses–somewhere on the order of 20 to 25 percent today. Of course there are significant creative and technical costs in publishing a beautiful new magazine in tablet form. Just adapting to the variety of screen sizes, screen resolutions and operating systems requires significant new investments. These costs, together with the aforementioned ad revenue decline, more than eclipse the savings from eliminating paper and postage.

So where will this margin come from if not from the consumer?

Tablets provide publishers a wonderful opportunity to rethink their products and add more value. But no manner of reinvention will be possible if they can’t mine their customer relationships to merchandise these new products. If the relationship between the magazine publisher and customer is broken, the industry will end up like music and book publishers–removed from customers, wedded to old habits and powerless as digital delivery inevitably overtakes and diminishes the value of their physical distribution.

Lastly, let’s consider the argument from a consumer’s perspective. Nearly one out of every two Americans subscribes to a magazine today. Many will purchase iPads and other tablets over the next year. When they do, Apple and others suggest that 150 million consumers ignore their existing relationships with publishers.

In this battle over ownership consumers are the losers. They will not be able to direct publishers as they wish, choose to get both a print and digital version of the magazine, or move to digital only delivery. They won’t be afforded the opportunity to get a better value by bundling their print and digital delivery together. They won’t be able to align their print and digital purchases so that expirations synchronize and billing is simplified. They won’t be able to move their experience to the device that suits them–irrespective of the platform–and read on phones, laptops, tablets or anywhere they like. Nothing in the transition will remove friction or frustration. Is this an experience we will be proud of?

There will be a transition from print to digital delivery that publishers and software providers must manage for consumers, and not solely for the advantage of their business interests. A print magazine is informative, beautiful, portable and easy to navigate. It’s also inexpensive. There will certainly be a long period when consumers will wish to try out new forms of reading on tablets but not give up their trusted print brands.

Businesses that make these transitions easy for consumers will flourish. Consider the long path to electronic billing for the banking industry, the Netflix shift from DVDs to video streaming, or even Apple’s introduction of Macs that run Windows software. In each case, the transition strategy provided for significant long-term advantage. And most would agree that there’s a significant long-term advantage for the software industry to make friends with 150 million magazine consumers.

Here’s how they do it:

1. Allow the customer to buy access to print, digital or bundle both together with one-click convenience.
2. Create simple APIs that connect the handful of major print fulfillment houses to application storefronts so existing print accounts can be harmonized with digital access.
3. Provide for critical customer data to flow to publishers so they can refine their products and find new ways to merchandise them to consumers.
4. Build opportunities for publishers to cross-merchandise products from within their applications and utilize one-click checkout.
5. Don’t thwart retailers like Amazon and Barnes and Noble who have existing relationships with publishers. They know how to merchandize magazines and will be a positive force for competitive pricing and product development.

With these measures I think very few publishers would object to the 30 percent cut these stores wish to collect or have any significant concerns about the stores retaining the direct billing relationship with their customers. In the end, publishers would build more unique magazine products, sell more related products and encourage their consumers to buy more devices.

Of course, without such cooperation publishers will always have a choice where to play. Tablets are not made of stone and publishers are not called upon by a higher power to work with distribution platforms that are fundamentally destructive to their consumer relationships and business interests.

John Squires is a former EVP of Time Inc., and founder of Next Issue Media

Here’s a reminder of what that was like: Meet StyleFind.com, which is supposed to be live Tuesday morning. It’s a new shopping site from Time Inc.’s InStyle magazine, and you’ll figure it out as soon as you see it.

In case you don’t: The site helps shoppers pick through some 2,000 brands, from 150 retailers, and eventually sends them off to partner sites, which handle the actual purchase and fulfillment. InStyle will get affiliate fees for forwarding on customers, giving the title another revenue stream to complement circulation and advertising.

StyleFind sports the requisite Twitter and Facebook buttons, but this isn’t one of the new breed of social shopping sites that have cropped up in the past year, like Svpply.

Instead, StyleFind assumes that shoppers are interested in the sense and sensibility that InStyle exudes, translated here by a small team of dedicated editors who pick out clothes and accessories.

Pretty straightforward stuff, and you can find versions of it elsewhere on the Web, and from other publishers as well. The major difference here is that Time Inc. built and operates the site itself, based on technology it acquired when it bought Boston-based StyleFeeder nearly a year ago for a price reported as “well into eight figures.”

Following that deal, Time Warner’s publishing unit then hired Bluefly vet John Carles to head up e-commerce for its Style group. Assuming Stylefind pans out, Carles will be able to use the same model for other titles, including People and even Entertainment Weekly, the publisher says.

Three months ago, the New York Times seemed to have halted its advertising skid after a very long slide.

Perhaps it has started up again. Ad revenue dropped one percent during Q3: Digital revenue jumped 14.6 percent, but that wasn’t enough to counter a 5.8 percent drop in print ads–which CEO Janet Robinson had thought would move up again this quarter. This morning, though, she cited “uneven economic conditions” and “marketplace volatility.”

Meanwhile, circulation revenue dropped 4.8 percent, and the company’s overall revenue sank by 2.7 percent.

The Times isn’t terribly optimistic about the fourth quarter: It thinks prints ads may improve “modestly,” while digital will grow by 10 percent, which is a deceleration from both this quarter as well as the previous quarter’s 21 percent growth rate.

Here’s the full breakout for the Times’ digital properties (NYT.com, About.com, etc), which appear to be doing pretty well:

• Total Internet revenues increased 13.3 percent to $89.4 million from $78.9 million.
• Internet advertising revenues increased 14.6 percent to $78.3 million from $68.3 million.
• Internet advertising revenues at the News Media Group increased 21.6 percent to $47.4 million from $39.0 million, mainly due to strong growth in national display advertising.
• Internet businesses accounted for 16.1 percent of the company’s revenues for the third quarter of 2010 versus 13.9 percent for the third quarter of 2009.

Meanwhile, the Times doesn’t have anything new to say about its plan to move its main Web site to a “metered model” pay wall next year. Perhaps we’ll hear something about it during the 11 am earnings call.

Let’s see if the paper’s executives can turn that around during their earnings call. We’ll also be looking for any updates the Times can provide on its pay wall plans, and, of course, its role in the launch of the Apple iPad.

UPDATE: As I noted below, though the New York Times (NYT) was a featured partner at the launch of Apple’s (AAPL) iPad, even sending a small team to Cupertino to create an app a few weeks before the event, there was zero discussion about iPads today.

CEO Janet Robinson made a generalized comment about the growth of the Times’s mobile distribution, but that was it. And not a single analyst showed any interest in this stuff–a good reminder that neither the Times nor Wall Street expects the iPad to be material to the company’s business for quite some time.

Liveblog

On the call: CEO Janet Robinson, CFO Jim Follo, Times Media Group boss Scott Heekin-Canedy, and Digital boss Martin Nisenholtz

In a preamble, CEO Robinson highlights cost-cutting, balance sheet repair, and asset sales (radio station, but not the Boston Globe; the company is still looking at selling its stake in the Boston Red Sox–the process is “complicated” and is “taking longer than anticipated”).

Robinson recaps the pay wall plan, metered approach, etc. Nothing new here so far.

The paper is waiting until 2011 to deploy the pay wall, she explains, because it wants to make “subscribing as smooth and easy as possible….It will take some time to build, deploy and test the best systems.”

Robinson offers a few revenue details, primarily a recap of the earnings release.

Ads by category: National ads down 12 percent, retail down 23 percent, classifieds down 27 percent.

News media online grew four percent, primarily from display advertising (the rest of online growth comes from About.com).

Print ad category decreases came from Hollywood, among others. Ad category increases: Print auto, health care, packaged goods.

Circulation revenue is up because of newsstand, price increases. The Times is benefiting from declines at other papers, because as local papers cut back, it is offering more info than ever. Robinson notes expansion by the paper into local news in the Chicago and San Francisco markets, adding that there are plans on going local in “several” other key markets

Time to brag about new mobile products and applications. The paper counted 75 million page views from mobile and apps in December, and the iPhone app has been downloaded three million times since launch.

Back to digital: Display ads are up, classifieds down; they improved “significantly” as Q4 progressed.

About.com is still the Times’s digital cash machine: Revenue is up 22 percent, and operating profit grew from $10 million to $18 million.

Overall, Internet businesses are up 10 percent and accounted for 15 percent of revenue for the quarter. Online advertising revenue accounted for 23 percent of ad revenue of the quarter.

“Limited” visibility for 2010, which is what’s upsetting The Street, supposedly. But the paper is still “realigning” its cost base.

CFO Jim Follo’s comments may not interest all readers except for this part: The Times is continuing to reduce headcount, he notes, which dropped by 18 percent in 2009. The company is also looking at the benefit structure for both employees and retirees. It froze that awesome supplemental retirement plan that pays certain retirees a very lucrative pension.

We’ve been benefiting from a drop in newsprint prices last couple years, Follo notes, though suppliers are trying to raise prices again, but there’s a supply glut, so we think they’ll have a tough time doing that.

No big capital spending projects are planned. [Presumably, the pay wall is not that expensive to build.]

[Aside: Interesting that NYT.com GM Denise Warren, who's normally on these calls, isn't on today's.]

Questions and Answers

Question: More color on advertising, please.

Scott Heekin-Canedy: We have some optimism, but advertisers are “guarded,” and ads are still bought–or retracted–at the last minute, as they were last year.

Tech, media, health care, and auto ad categories all look promising. The mix is “definitely different” from last year “when it seemed like every single category was down.” Now, many categories are showing “flat to significant growth.”

Question: Are you still optimistic that you can reach a deal on the Red Sox?

Robinson: “Yes we are.” Lots of due diligence, lots of different properties (stake in team, stadium, network, etc.).

Q: What are incremental costs of setting up a pay wall?

Robinson: “We feel this is an elegant solution,” but we want to wait the year and make sure we’re well prepared, etc. Again, integrating home delivery and digital is crucial.

Nisenholtz: Regarding cost, there will be a “modest operating cost” to deploy the tech. We’re hiring a “handful” of people to do that and deploying “modest” capital, but it’s not material.

[Apology: I missed a question on ad categories, though it seems to reprise the earlier question.]

Q: Can you give us a sense of additional cost-savings you can extract this year?

Follo: Nope.

Q: Will your headcount go down again in 2010?

Follo: Yes.

[Missed another question here.]

Next a question about the tax rate, which I can’t imagine anyone reading this cares about.

Q: Can you tell us more about January ad trends, i.e., how much is national vs. local?

Robinson: We won’t break that out (anymore).

Q: Was it materially better than Q4?

Robinson: She repeats her earlier comments from the release. “Very good performance” on the digital side of business. December was particularly good, but we’re not going to be more specific about January.

Heekin-Canedy: That said, we don’t think January is much of an indicator about the rest of the year, anyway. Different beast, not much connection between December [when people were dumping leftover dollars].

[There's a giant disconnect between analysts and the chattering classes here. If the latter ran the call, this would be about nothing but iPad, iPad, iPad. But we're 48 minutes in, and zilch so far. Which is a good reminder: No matter what launches with the tablet this year, this stuff isn't going to have a big impact on Big Media for quite some time.]

Q: Where is growth coming from at About.com?

Robinson: Both consumer packaged goods and display ads. We’ve upgraded the sales channel to go after display and that’s helped a lot.

Nisenholtz: Strong categories include CPC, travel, education and financial services. There’s also retail strength.

Q: Are CPGs new to About.com?

Nisenholtz: Yeah. Well, not exactly. It’s a big site, lots of reach. But we’ve updgraded the sales team and the increase there is part of the payoff. We reach a lot of moms. The Web site skews female.

Q: You may end up paying $60 million to $80 million back into the pension plan. When could that come? Q4?

Follo: Could be sooner than that. We’re in a good position regarding liquidity.

[The final question is about joint ventures that you don't care about.]

And that’s it for the call.

• News Corp. CEO Rupert Murdoch tried to lower expectations that his Fox broadcast network would hire Conan O’Brien.
• Murdoch hinted that his book publishing unit is in line to get a new deal on e-books from Amazon, just as Macmillan has demanded (as will other publishers).

On the second point, here’s my on-the-fly transcription and paraphrasing of Murdoch’s comments about Amazon (AMZN), Apple (AAPL) and e-book pricing. It’s one of the most candid descriptions you’ll hear from a top executive about Big Media’s reluctance to embrace digital distribution at the expense of its existing system and revenue:

“We don’t like the Amazon model of $9.99….We think it really devalues books and hurts all the retailers of hardcover books. We’re not against electronic books; on the contrary, we like them very much” because they cost us less to distribute, “but we want some room to maneuver.” The Apple deal…“does allow some flexibility and higher prices” though e-books will still be lower than print versions. And now Amazon is willing to sit down with us again and renegotiate.

UPDATE: Here’s a more complete transcript from Seeking Alpha:

We don’t like the Amazon model of selling everything at $9.99. They don’t pay us that. They pay us the full wholesale price of $14 or whatever we charge. We think it really devalues books and it hurts all the retailers of the hard cover books. We are not against [inaudible] books. On the contrary we like them very much indeed. It is low cost to us and so on. But we want some room to maneuver in it. Amazon, sorry Apple in its agreement with us which has not been disclosed in detail does allow for a variety of slightly higher prices.

There will be prices very much less than the printed copies of books but still will not be fixed in a way that Amazon has been doing it. It appears that Amazon is now ready to sit down with us again and renegotiate pricing.

Again, it’s impossible to stress how scarring the music labels’ experience has been for Big Media. And they’re determined not to repeat the experience. Their takeaway, though, seems to be that they can stave off digital distribution by keeping prices high and inventory relatively scarce. Hard to believe consumers are going to go for that.

Earlier

A first glimpse at News Corp.’s fourth-quarter earnings (which, due to the company’s weird fiscal calendar, is technically the company’s Q2 for 2010): Pretty good. And much better than a year ago (thankfully). After factoring out one-time charges, the company posted earnings of 25 cents on revenue of $8.7 billion.

The Street was looking for earnings of 20 cents on revenue of $8.23 billion, and analysts were also hoping the company would boost its earnings forecast, due in part to a bump from the ginormous success of “Avatar.” No word on guidance in the earnings release, though.

I’ll pick through the release for other worthwhile nuggets for the next few minutes. And then the real show begins at 4:30 Eastern, when the company’s earnings call–easily the most entertaining one in its peer group due to the censor-free presence of CEO Rupert Murdoch–begins. We’ll be looking for commentary on his battle/negotiation with Google (GOOG), upcoming content deals with Apple and the iPad, his thoughts on paid content in general, a dash of political commentary or two, and an update on the turnaround effort at MySpace.

From the release: A pretty nice quarter at most of the conglomerate’s divisions, including the previously battered broadcast TV and newspaper groups. News Corp. says print revenue at The Wall Street Journal was up five percent and ads on the Journal’s digital network were up 17 percent.

MySpace and the company’s other digital properties, shuffled into the “other” category, don’t get much of a mention, but don’t seem to have done much, not surprisingly.

But News Corp does mention that digital media earnings were down $32 million compared with a year ago, “principally due to lower search and advertising revenue.” And the company lost $29 million on “digital media dispositions”–i.e., the fire sale/giveaways of properties like Rotten Tomatoes and Photobucket.

Here’s the breakdown by segment (click table to enlarge):

Liveblog

CFO Dave DeVoe: “Extremely pleased” with the quarter.

Movies: Revenue up due to decent DVD sales (no MGM problem here). Also high costs due to “Avatar,” but big profits from the movie will be coming in during the next couple quarters.

Broadcast TV: Local ads are improving; the telecom, fast food, finance categories are all improving.

Cable: Revenue is up 18 percent. Affiliate revenue is up 21 percent (more money for Fox News subs), and there was a “single-digit” boost in ad dollars.

Newspapers: Journal dollars are up, operating costs down. Ad revenue got better as the quarter progressed.

Books: Revenue up, expenses down.

“Other”/MySpace: Digital media revenue down, but cost-cutting helped trim losses.

News Corp. is boosting its dividend by 25 percent.

Guidance: The company’s operating income growth rate is expected to grow from single digits to the high teens. Better than anticipated: Film group, TV and cable. But revenue goals for digital media, including MySpace, will take longer than anticipated.

Murdoch sings the praises of content. [I will not argue with him, for now]. “Avatar” is awesome, he says, a “harbinger of fundamental change in the industry.” Also really good: “Alvin and the Chipmunks.” Fun to hear Rupe say “Alvin and the Chipmunks.”

WSJ is the No.1 paper in U.S. in terms of circulation, influence, quality. WSJ.com is a “digital model for newspapers around the world.”

Fox News Channel’s audience is both “loyal and lucrative.” Roger Ailes is doing an “admirable job” [translation: Bite me, Michael Wolff--the author of a recent Murdoch biography].

Last year, Murdoch says, News Corp.’s pay-to-play ideas sounded nutty, but now “the content clan has gathered around our ideas.” Consumers must pay and will pay “to be entertained and informed.” All those awesome new gadgets being made in China and sold at the Consumer Electronics Show need content or they’re worthless. Content, content, content. Get it? Content, content, content.

Murdoch says he’ll be wringing more dollars from cable operators. And “when it comes to online news, we’ll be changing that model too,” adding that News Corp. is in “substantive conversations with device makers on developing subscription models” to deliver content. And don’t forget about 3-D!

Not performing well but “long-term growth drivers”: Sky Italia satellite service. Also Sky Deutschland. And MySpace is “not yet where we want it.” In the last quarter, however, MySpace “started to see signs of traffic stabilization.”

Shout-outs for Chase Carey and other managers (but not by name).

Q&A

Question: How big a deal is retransmission consent in coming years? $40 million a month? $100 million a month?

Chase Carey: No numbers, but it’s going to be a “transforming event.” We have two of top 10 distributors done, more coming. It’s a three- or four-year process to knock these deals out.

Q: Does this fix the broadcast model?

Carey: “Yes, I guess you could say simplistically, it fixes it.”

Q: What’s the timing on an “Avatar” DVD, and what about a sequel? Also, how do TV ads look this year?

Murdoch: For “Avatar,” we think about 60 percent of profits will be in the next six months. Which means the DVD will be coming “as soon as possible,” but the movie will stay in cinemas for a while because we’re doing huge dollars in theaters still. Sequel? “Very early talks about it. Jim has ideas for one. We haven’t come to any agreement with him….Being Jim Cameron, I wouldn’t hold your breath for an early one.” Asked about the economics of a future release (“Will you keep the same revenue split?”), Rupe sort of rumbles and growls and sort of doesn’t have much to say. “Ask anybody; it is very easy to drop a $100 million in a hurry on a film, and we’d like to lay off some of the risk.”

Carey: TV trends for this year are “positive.”

Murdoch: TV stations will be up 18 or 19 percent, but last year was terrible. We’re still down compared with two years ago. Hard to see more than a quarter in advance. In newspapers, it’s hard to see more than a few weeks.

[Missed a question on Sky Italia here.]

Q: What are growth prospects for cable networks? They’ve been driven a lot recently by new subscriber fees. How much longer can you get those boosts?

Murdoch: Overall, “we think we have great potential for growth. Quite a long way to go yet.” Look at how NBCU’s USA is growing.

Carey: In the U.S., we’re moving to “quality over quantity”–we can wring more out of foreign exchange, etc. Fox News is only getting more powerful; it has “great upside.”

Q: Regarding newspapers, what growth came from organic increase versus currency fluctuations?

The majority is from foreign exchange.

Q: Does your guidance assume that the “Avatar” DVD is coming in the next two quarters?

Murdoch: “Yes, but it won’t be 3-D” [which I don't think the analyst was asking about].

Q: Back to retransmission consent: You’ve been getting more and more money from cable guys. Why can’t you get $4 or $5 per subscription for Fox broadcast subs?

Murdoch: “We’re modest people.”

Carey: Hyuk, hyuk. Real answer: It takes time. “We try to approach this constructively. We’ve built businesses with [cable guys], we’ve built valuable cable channels” [translation: patience!]. We want to extract more without killing the cable guys.

Murdoch: That said, we’re asking for the same thing [for broadcast channels] that the cable networks are getting, which “certainly won’t kill the cable companies.”

Q: Please talk about value of film libraries (i.e., MGM). They’re generating big operating profits for cable now. How long will this last?

Murdoch: Regarding the MGM auction, “you can count us out of that one altogether” because others will pay more than we’re willing. And we’re not pursuing the Miramax catalog at all.

Carey: A film library by itself, without new stuff coming through, is a “depreciating asset.”

Q: On guidance: You say the ad market getting better, etc., but it sounds like you’re saying Ebidta growth is slowing.

Murdoch: “We honestly do not have any visibility about the last quarter.”

Q: On books/e-books/Apple, what’s going on with that?

Murdoch: We don’t like the Amazon model of $9.99….We think it really devalues books and hurts all the retailers of hardcover books. We’re not against electronic books; on the contrary, we like them very much, lower costs to us, but we want some room to maneuver. The Apple deal does allow “some flexibility and higher prices” though e-books will still be lower than print. And now Amazon is willing to sit down with us again.

Press Q&A

Q: What’s up with plans to charge for newspapers on the Web?

Murdoch: “Not ready to announce yet [long pause]. We won’t be ready yet to make an announcement.” A “lot of talks with a lot of people.” There will be more to say within the next two months, Murdoch adds.

Q: Are you still going to fall $100 million short on the Google deal?

Murdoch: Yes. People using social networks don’t use search a great deal. Facebook has seen this, too. It’s “really too early to make confident predictions…but from going down, we’re beginning to go up.”

Q: Can we get some details about Time Warner Cable (TWC) deal?

Nope.

What about Conan O’Brien on late night?

Murdoch: If the programming people can show us we can do it and make a profit on it, we’ll do it in a flash. I’m sure there have been conversations with Conan, but “if you mean real negotiations, no.”

[Missed two questions here.]

Q: Another late-night question: If you do go into negotiations with Conan, how do you placate your affiliates?

Murdoch: It’s a different deal than NBC. They screwed up 10 pm, which reduced the lead-in to local news. Our affiliates run syndicated programming at 11:30, though, so it will take time to adjust there.

Call ended. This one seemed short to me.

More or less redundant disclosure: News Corp. (NWS) owns this Web site.

Google CEO Eric Schmidt did one of his patented throat-clearers in an opinion piece in The Wall Street Journal today and it pretty much begs for translation.

Well, BoomTown shall not tarry from the task of decoding the extra-long rumination from the head of Google (GOOG), who was responding to the recent spate of aggressive attacks by traditional media publishers.

They have blamed the search giant for everything from their current business woes to the destruction of journalism to Tiger Woods’s dicey marital troubles.

Okay, not that! But the rest for sure.

First and foremost among the attackers has been Rupert Murdoch, CEO and ruler-of-all-he-surveys at News Corp. (NWS), which owns The Wall Street Journal and this Web site.

How ironic, yet still typically cozy from a corporate bigwig point of view! I call you a cur in public, but please use my newspaper so that I can get some decent traffic from this wrestling match.

But all is not what it seems in the Schmidt piece, of course, so here’s the translation:

What Schmidt wrote: How Google Can Help Newspapers

By ERIC SCHMIDT

Translation: We come in peace, always. You know, like the freakily calm lady from “V,” who is really a lizard under all that pretty and is actually secretly trying to decide between grilling and broiling all you whiny news people.

Also, you can address me in the future as Emperor Palpatine.

What Schmidt wrote: It’s the year 2015. The compact device in my hand delivers me the world, one news story at a time. I flip through my favorite papers and magazines, the images as crisp as in print, without a maddening wait for each page to load.

Some of these stories are part of a monthly subscription package. Some, where the free preview sucks me in, cost a few pennies billed to my account. Others are available at no charge, paid for by advertising. But these ads are not static pitches for products I’d never use. Like the news I am reading, the ads are tailored just for me. Advertisers are willing to shell out a lot of money for this targeting.

Translation: It’s the year 2015 in the United States of Google, where the new country colors are a festive green, blue, red and yellow.

As per the new Declaration of Googlependence, besides the tracking chip in your thighs, every citizen will be outfitted with a tablet running Chrome and looking suspiciously like a large iPhone, except that Apple (AAPL) was outlawed in the Fanboy Purge of 2010.

Every day, citizens will receive news specially aimed at them, such as “The Health Benefits of Sergey Worship.” Ads will also be tailored to citizens’ likes and dislikes, such as a pitch for Googley deodorant with the motto: “Search me, because I smell nice!”

Costs will be billed to your accounts at the National Bank of Google.

What Schmidt wrote: This is a long way from where we are today. The current technology–in this case the distinguished newspaper you are now reading–may be relatively old, but it is a model of simplicity and speed compared with the online news experience today. I can flip through pages much faster in the physical edition of the Journal than I can on the Web. And every time I return to a site, I am treated as a stranger.

So when I think about the current crisis in the print industry, this is where I begin–a traditional technology struggling to adapt to a new, disruptive world. It is a familiar story: It was the arrival of radio and television that started the decline of newspaper circulation. Afternoon newspapers were the first casualties. Then the advent of 24-hour news transformed what was in the morning papers literally into old news.

Translation: [Rachel: Please insert usual pap boilerplate here damning the newspaper business with faint praise. History of how change hurts, but is inevitable...blah, blah, blah. Please make sure to deliver a few digs too, like how--unlike Google--newspapers have no idea what their readers did last summer. Like we do. Cue evil Mwahahahaha laugh here.]

What Schmidt wrote: Now the Internet has broken down the entire news package with articles read individually, reached from a blog or search engine, and abandoned if there is no good reason to hang around once the story is finished. It’s what we have come to call internally the atomic unit of consumption.

Translation: “Atomic unit of consumption” is one of those terms we don’t expect you small-brained people to even begin to understand. Although you use only eight percent of your mental capacity, we here at Google use an average of 71 percent, tracking on our search share.

What Schmidt wrote: Painful as this is to newspapers and magazines, the pressures on their ad revenue from the Internet is causing even greater damage. The choice facing advertisers targeting consumers in San Francisco was once between an ad in the Chronicle or Examiner. Then came Craigslist, making it possible to get local classifieds for free, followed by Ebay and specialist Web sites. Now search engines like Google connect advertisers directly with consumers looking for what they sell.

Translation: I also don’t expect you Luddites will get this, but all your base are belong to us.

For those who need an older cultural reference, it is like the end of “Butch Cassidy and the Sundance Kid.” Um, as much as you Hollywood types like a happy ending, Butch and the Kid did not make it.

What Schmidt wrote: With dwindling revenue and diminished resources, frustrated newspaper executives are looking for someone to blame. Much of their anger is currently directed at Google, whom many executives view as getting all the benefit from the business relationship without giving much in return. The facts, I believe, suggest otherwise.

Google is a great source of promotion. We send online news publishers a billion clicks a month from Google News and more than three billion extra visits from our other services, such as Web Search and iGoogle. That is 100,000 opportunities a minute to win loyal readers and generate revenue–for free. In terms of copyright, another bone of contention, we only show a headline and a couple of lines from each story. If readers want to read on they have to click through to the newspaper’s Web site. (The exception are stories we host through a licensing agreement with news services.) And if they wish, publishers can remove their content from our search index, or from Google News.

Translation: Shut your overstuffed pie holes, you grumbling antiques. You were dying by the cell long before our superior technology arrived to save the day and help you out of your sorry mess.

Plus, we toss you all that traffic and you still manage to fumble our perfect pass like the pikers you are. (In truth, you are Charlie Brown and we are Lucy.)

Also, have you ever heard of “fair use”? It’s the law now and we can hire more lobbyists in Washington, D.C., than you with the bazillions and gamillions of dollars we make from all those tiny little blue links.

You do realize I have a key to the the White House and visit more times than Joe Biden?

What Eric wrote: The claim that we’re making big profits on the back of newspapers also misrepresents the reality. In search, we make our money primarily from advertisements for products. Someone types in digital camera and gets ads for digital cameras. A typical news search–for Afghanistan, say–may generate few if any ads. The revenue generated from the ads shown alongside news search queries is a tiny fraction of our search revenue.

Translation: Here’s an easy formula for you to grok: Michael Jackson+the pretty boy from “Twilight”+digital cameras=Big bucks for Google! Some thumbsucker you did on Afghanistan, however worthy and important for our nation’s future=14 cent CPM, but only if a drunken Lindsay Lohan story is in close proximity.

What Schmidt wrote: It’s understandable to look to find someone else to blame. But as Rupert Murdoch has said, it is complacency caused by past monopolies, not technology, that has been the real threat to the news industry.

Translation: [Rachel: Please insert Rupe quote that actually hangs him here.]

What Schmidt wrote: We recognize, however, that a crisis for news-gathering is not just a crisis for the newspaper industry. The flow of accurate information, diverse views and proper analysis is critical for a functioning democracy. We also acknowledge that it has been difficult for newspapers to make money from their online content. But just as there is no single cause of the industry’s current problems, there is no single solution. We want to work with publishers to help them build bigger audiences, better engage readers, and make more money.

Meeting that challenge will mean using technology to develop new ways to reach readers and keep them engaged for longer, as well as new ways to raise revenue combining free and paid access. I believe it also requires a change of tone in the debate, a recognition that we all have to work together to fulfill the promise of journalism in the digital age.

Translation: Really–we’re from Google and we’re here to help! Mwahahahahaha.

Seriously, you guys, please go back to demonizing Microsoft (MSFT) or those banker salaries or the health care bill.

While my gabillions of dollars are more than protecting me from the blows you are trying to land, I am not liking the hairy eyeballs I got at the Allen & Co. conference at Sun Valley last summer. I think Washington Post head Don Graham even short-sheeted my 600-thread count Frette bedding there.

What Schmidt wrote: Google is serious about playing its part. We are already testing, with more than three dozen major partners from the news industry, a service called Google Fast Flip. The theory–which seems to work in practice–is that if we make it easier to read articles, people will read more of them. Our news partners will receive the majority of the revenue generated by the display ads shown beside stories.

Translation: [Rachel: Please insert some kooky-named Google 20 percent project we have no intention of really going large on here, so they think we really are working on something to save them. Those media folks like Hail Mary tech solutions, even if they don't even know how to turn them on.]

What Schmidt wrote: Nor is there a choice, as some newspapers seem to think, between charging for access to their online content or keeping links to their articles in Google News and Google Search. They can do both.

Translation: You de-indexin’ me? You de-indexin’ me? You de-indexin’ me? Then who the hell else are you de-indexin’? You de-indexin’ me? Well I’m the only one here. Who the %*#! do you think you’re de-indexin’?”

What Schmidt wrote: This is a start. But together we can go much further toward that fantasy news gadget I outlined at the start. The acceleration in mobile phone sophistication and ownership offers tremendous potential. As more of these phones become connected to the Internet, they are becoming reading devices, delivering stories, business reviews and ads. These phones know where you are and can provide geographically relevant information. There will be more news, more comment, more opportunities for debate in the future, not less.

The best newspapers have always held up a mirror to their communities. Now they can offer a digital place for their readers to congregate and talk. And just as we have seen different models of payment for TV as choice has increased and new providers have become involved, I believe we will see the same with news. We could easily see free access for mass-market content funded from advertising alongside the equivalent of subscription and pay-for-view for material with a niche readership.

Translation: Smartphones are the answer! Sure! Your aging demo loves reading teeny-weeny writing on a device they want to throw against a wall.

Or maybe you can be like HBO! Except you’ll need more borderline porn and Mafia guys.

What Schmidt wrote: I certainly don’t believe that the Internet will mean the death of news. Through innovation and technology, it can endure with newfound profitability and vitality. Video didn’t kill the radio star. It created a whole new additional industry.

Translation: A census taker once tried to test me. I ate his liver with some fava beans and a nice chianti.

Tough times have forced many papers to rethink their circulation strategies. An obvious conclusion: Much of the money publishers were spending to print and deliver dead trees has gone to waste. New strategy: Print fewer copies, and charge more for the ones you do sell.

That’s a tactic, not a strategy, but in the near-term it might work.

In its last quarter, for instance, the New York Times (NYT),  saw its daily circulation drop by more than seven percent, but saw circulation revenue jump 6.7 percent, due to price increases. Last spring a single copy of the Times at a newsstand jumped from $1.50 to $2.00, and a Sunday Times now costs a staggering $6. But people are buying them.

Meanwhile, News Corp. (NWS), which owns The Wall Street Journal as well as this Web site, has been steadily increasing the WSJ price. And circulation revenue is up at the McClatchy (MNI) and Media General (MEG) chains.

Again, the industry can’t shrink its way to recovery. There are fewer people paying for news–on or offline–than there have been in decades, and there’s no way to paint this as a positive. But the people who still subscribe to papers value them, and it would be foolish not to capitalize on that. Editor & Publisher:

There are several reasons as to why circulation keeps dropping, aside from former readers who have kicked the print edition to the curb. Publishers have been purposely pulling back on certain types of circulation, including hotel, employee and third-party sponsored copies. No longer are they distributing newspapers to the outer reaches of the core market. The cost of delivery and the cost of materials have forced publishers to scale back.

Another shift has occurred: volume has taken a back seat to dollars.

Several major newspapers across the country have aggressively hiked prices of single-copy and home-delivered papers in search of circulation revenue and a renewed focus on loyal readers. Circulation is guaranteed to go down as prices go up, but publishers have opted to wring more revenue from readers as advertisers keep their coffers closed.

That’s the high end of the range Bloomberg will be paying for BusinessWeek, reports BusinessWeek, which has done an excellent job of covering its sale. One important note to make about the price: Those liabilities could total up to $32 million, although it’s not clear whether Bloomberg will assume all of them.

Can’t call this one a surprise, as Bloomberg has reportedly been the lead bidder for some time now. BusinessWeek employees spent most of the day waiting for an announcement to that effect, and finally heard one, via Bloomberg’s wire service, shortly after 5 pm EDT.

Shortly after, BusinessWeek Editor Stephen J. Adler gathered his troops for an informal meeting to discuss the news and to discuss some blocking and tackling: No news on rumored (and expected) layoffs. But he did tell staffers that those who are cut after the deal closes later this year will receive the same severance package they would have gotten if they were still employed by McGraw-Hill (MHP), the magazine’s parent company.

There most certainly will be cuts: McGraw-Hill is selling the 80-year-old magazine because it’s a money pit that was losing between $20 million and $40 million a year, depending on your accounting. And the publisher’s bankers promoted a layoff plan as part of the sales process.

What exactly deep-pocketed Bloomberg intends to do with the publication, however, is unclear. The company, which makes its money renting its namesake terminals to Wall Street traders, is thought to be running its magazine and TV news operations at a loss as it tries to grab a footprint in consumer media. It may ultimately be willing to run BusinessWeek at a loss for a while, as well.

And now a tiny bit of context: At the beginning of this year, there were four major business magazines. Now one, Condé Nast’s Portfolio, has been shut down and another sold at a fire-sale price. Meanwhile, my former colleagues at Forbes expect to hear about yet another restructuring round in the near future. And while Time Warner (TWX) CEO Jeff Bewkes was careful to list Fortune magazine among the core assets at his company’s Time Inc. unit at an industry event today, that can’t assure the queasy souls who work there.

Here’s the memo to BusinessWeek staff from the magazine’s BusinessWeek publisher, Keith Fox:

All,

Moments ago, McGraw-Hill announced that Bloomberg L.P. has agreed to acquire BusinessWeek. This is exciting news on many levels. Joining forces with another of the world’s leading news organizations enhances BusinessWeek’s ability to further serve our global audience and our valued customers. And Bloomberg will gain a powerful brand with a history of editorial excellence and strong reach among business professionals.

While the ink is barely dry and the long-term plans are being worked out, we do know that Bloomberg is committed to and values our brand, our editorial integrity, and our ability to drive advertising, circulation, and new digital revenue.

BusinessWeek will strengthen Bloomberg’s online, television and mobile products and creates an opportunity for Bloomberg News to reach decision makers in the c-suite. Online, BusinessWeek.com and Bloomberg.com will have more unique visitors than any non-portal business and financial site. In addition, Bloomberg expects to build television content around the powerful BusinessWeek brand and our world-class journalists.

I am tremendously proud of the work all of you have done in the past few months. Despite the uncertainty, we have continued to produce first-class products for our readers and advertisers, and I want to thank you deeply for your efforts. I also want to thank Steve Adler, Jessica Sibley, Tania Secor, Roger Neal, and Linda Brennan, for their extraordinary ability to personify the best of BusinessWeek during the deal process while leading their respective organizations.

I know that while this announcement answers some of the questions you’ve been asking over the past few months, it raises others. The sale is expected to close by the end of the year and we will be working on transition plans in the coming weeks. I can tell you that all BusinessWeek staffers will remain employees of The McGraw-Hill Companies until the transaction closes, and that it will be business as usual–producing the magazine and the website, and serving our advertisers–through the close. We will give you more details when we can.

We’ll be holding a town hall meeting later today at 5:45 EST, after which a Q&A will be provided to all employees; you will receive more details shortly. A call for the Asia teams will be scheduled shortly.

Again, I want to thank you all for your professionalism and dedication during a challenging time. I look forward to working with you on the promising next chapter in BusinessWeek’s history.

Keith

Say it ain’t so.

Having fully embraced the Internet–sometimes to much disdain from old media colleagues back in the day–since the early 1990s as the way of the future in publishing, and even going to far as to abandon a career in print forever some years ago, BoomTown is bereft at the news yesterday that Gourmet magazine was being shish-kababbed.

Gourmet has been, since I started reading it as a young girl, one of the more perfect magazines–full of glamorous travel locales, stunning photos of food and sumptuous prose, all beautifully edited.

Let’s all agree first to blame owner Condé Nast, the famed magazine unit of privately held Advance Publications, for deciding to shutter the elegant and iconic Gourmet–which has been around since 1941–after the November issue.

While circulation remained steady at Gourmet at just under one million monthly paying subscribers, Condé Nast Chief Executive Officer Chuck Townsend pointed to a fall-off in advertising spending by luxury brands that resulted in a money-losing mess.

But, in a follow-up piece in The Wall Street Journal, titled “Gourmet Magazine’s Demise Gives Readers Empty Feeling,” plunging newsstand sales were also noted, apparently due in part to the impact of the Web.

“Gourmet has had to compete with food-related Web sites, which are often free and contain up-to-the-minute content,” said the Journal article.

In other words, the same thing that is occurring in all arenas–from food to tech to fashion to news–was left unsaid.

As in: The scourge of the Internet, laying waste to all those it comes in contact with.

But I dearly hope that this episode with Gourmet does not become another one of those death-by-digital cautionary tales, a case study that no one can sustain this kind of highbrow, expensive-to-make print media anymore, even the free-spending types at Condé Nast.

I am not sure that’s exactly true, though, since the analog experience Gourmet provided was not the same as what’s on the Web, which is what probably kept its circulation steady over the years.

It was clearly an issue of the econalypse–obviously helped along by the fact that people’s reading habits are shifting to online, thought that’s not the root issue.

That’s why Townsend added that Gourmet might live on in books, on television and, most likely of all, on the Internet.

That Gourmet already has a dullish Web site was not mentioned since it is free and not particularly different from the magazine–a decent repurposing, but a repurposing nonetheless.

Now that there is no magazine to fill that Web void, it will be interesting to see if more could be done online with the iconic foodie brand.

Or not.

(That September cover picture above is a quince, by the way, which most would never really know without–um, er–the help of Gourmet.)

Here’s why: The yet-to-be-described subsidy the papers plan to offer to Kindle DX buyers who agree to long-term subscriptions will only be available to a fraction of subscribers–those who can’t get home delivery of the print edition.

From Amazon’s press release: “The New York Times Company (NYT) and Washington Post Company (WPO) are launching pilots with Kindle DX this summer. The New York Times, The Boston Globe, and The Washington Post will offer the Kindle DX at a reduced price to readers who live in areas where home-delivery is not available and who sign up for a long-term subscription to the Kindle edition of the newspapers.”

Since the New York Times is available for home delivery throughout most of the U.S., that means that the majority of its American readers will have to pay full freight–$489–for the gadget. I suppose you could circumvent this if you lived, in say, Minneapolis, by agreeing to subscribe to the Boston Globe instead, which you can’t get delivered at home there. But what’s the point?

My assumption here is that the terms were set by the Times and the Post, which presumably don’t want to cut into print circulation. This makes sense if you’re focused on the very, very short term, since the print editions–both via subscriptions and the ads they contain–still deliver the majority of newspaper revenue for both companies.

Then again, that business isn’t going gangbusters for any of the papers involved. The Times, for instance, spent the early morning hours today hammering out a labor deal that will allow it keep the Globe in business.

The easy way to improve the offer: Copy my corporate colleagues at the Wall Street Journal, and offer a bundle online/offline subscription. But once you start doing that, you get into interesting billing issues, which is going to be fodder for another post.

Who knows? Maybe they’ll try it. Since everyone involved is careful to point out that this is an “experiment,” etc., it’s possible that the papers could reconsider the offer sooner than later. Which I hope they do: It’s a nice-looking device, and it would be a shame if no one ever used it.

Kelly’s number for today “may be on the high side,” a person familiar with the matter counsels me. In any event, I expect to have more details later in the day. As always, I value your input, and I keep all correspondence anonymous: peter@allthingsd.com.

In the meantime, an update on this week’s cuts: I’m told Time Europe editor William Green and senior editor James Graff were laid off via phone yesterday, and that more cuts in the London office are expected today. And four-year-old Cottage Living magazine has been shut down, which means that 38 out of 47 people who worked on that title are out of work; the remainder will be placed elsewhere in the group. Announced along with the job cuts today were the departures of executives from Cooking Light and Southern Progress. Chris Allen, Senior Vice President and Publisher of Cooking Light is resigning his position, as are Southern Progress execs Bruce Akin, Karla Hardy and Dick Gardner. Here are the memos:

November 18, 2008

To:Time Inc. Employees
From:Sylvia Auton
Re: Cottage Living Magazine

I regret to inform you that we will no longer be producing Cottage Living magazine. The November/December 2008 issue, on newsstands now, will be the magazine’s last. Cottageliving.com will also shutdown. However, the company will keep the brand alive in one of its other leading shelter titles and these plans will be finalized over the next few weeks.

Since its inception, Cottage Living attracted significant advertiser support and fostered a loyal following among readers. However, the economic downturn has particularly affected the shelter market and while the brand was genuinely loved by readers and advertisers alike, the economy inhibited its ability to grow and therefore, sadly, we had to make the decision to close it.

Cottage Living launched with a unique editorial mission. Its readership celebrated community and character over conformity, personality rather than perfection, and informality instead of pretension. The brand’s tagline: ‘life just right,’ showed how one could ‘live large,’ even luxuriously, in a lighter footprint.

Launched in September 2004 with a circulation of 500,000, the brand quickly grew to 650,000 in January/February 2005. One year later, Cottage Living increased its rate base to 900,000, and then to one million in January/February 2007. Cottage Living also produced many one-time special-interest publications including Cottage Christmas and Cottage Makeovers.

Cottage Living also received many industry accolades including AdWeek’s ’2005 Startup of the Year’ and Advertising Age’s ’2005 Launch Worth Watching.’ It was also named to AdWeek’s ‘Hot List’ 10 Under 50 list for two consecutive years: 2006 and 2007.

I want to thank the many dedicated and talented Cottage Living staffers. It was developed, edited and published by some of the best talent in the business and we can remain proud of its many achievements.

S.A.”

Subject: Staff Announcement
To:       Lifestyle Business Unit Employees
From:   Sylvia Auton and Steve Sachs
Re:       Staff Announcement  

With the departure of Bruce Akin, we’re pleased to announce that Bruce Larson will assume the role of Senior Vice President and the lead executive in charge of SPC operations for Time Inc. He will be responsible for the general management of all operations in the Birmingham office, Oxmoor House and Southern Living at HOME.

Bruce joined the company in 1991 as a manager of corporate reporting. Over the last 17 years he has been promoted numerous times and has held jobs in a variety of areas, from corporate accounting to IT to consumer marketing and production.

During his tenure with Southern Progress, Bruce has shown outstanding decision-making and leadership skills and has been a key player responsible for the strong financial growth the company has enjoyed over the years.

Please join us in congratulating Bruce on his new assignment.”

To:  Southern Progress Colleagues
From:  Bruce Larson

I regret to announce that two longtime, trusted Southern Progress colleagues, Karla Hardy and Dick Gardner, have decided to retire at the end of the year.

Karla has been a steady presence in our advertising production circles ever since she joined the company in 1977 as advertising traffic manager for Progressive Farmer. In 1985, she accepted a position as assistant to the editor and advertising/production coordinator for Southern Living Classics, which merged later that year with the newly acquired Southern Accents, where she eventually moved up to advertising production manager. When we launched Coastal Living, Karla began working on both titles, and in 2007 she began helping manage advertising production for Cottage Living as well. And let’s not forget her work on Entrée. With her incredible depth of knowledge of advertising production and her keen eye for detail, it’s no wonder that Karla is so highly regarded. She knows how to best position each ad for space efficiency and visibility, and she knows how to work with our sales staff and advertisers to ensure that everyone is happy with the outcome.

Dick began his Southern Progress career just nine months after Karla, back in 1978. He spent the first 13 years of his SPC career on the corporate side, managing building operations, office services, and purchasing, before moving to the magazine side of the business as financial manager for Southern Living and Southern Accents. In 1995, he was named general manager of Southern Accents. One short year later, he added responsibility for the soon-to-be-launched Coastal Living. In 2004, he was named vice president and general manager for Coastal Living alone, and in 2007 he took on the GM role for Cottage Living as well. Dick is well respected for his wisdom, leadership. and kindness, not to mention his astute business sense. He knows his titles—and his staff—inside and out and never fails to find the right solution to any challenge. Plus, he has a great sense of humor.

There have been several times over the years when both Dick and Karla have been counted on to work on more than one title—a sure sign of how highly they’re valued around here—and each did so while managing to maintain a positive, calm outlook. Please join me in thanking them for all they’ve done for us and letting them know how much they’ll be missed.”

Subject: Staff Announcement
To: Lifestyle Business Unit Employees
From:  Sylvia Auton
Re:  Staff Announcement

After careful consideration, Chris Allen, Senior Vice President and Publisher of Cooking Light, has decided to leave the company.

A 26-year veteran, Chris first joined Cooking Light in 1991 as eastern advertising sales director and quickly rose through the ranks. Chris’ leadership and expertise resulted in enormous successes for the Cooking Light brand: Under his direction, Cooking Light has grown to become the world’s largest epicurean and healthy lifestyle magazine.

During his tenure, Cooking Light was named to AdWeek’s Hot List four times, Advertising Age’s ‘A List,’ Capell’s Circulation Report’s prestigious ‘Triple Play Award’ three times, and ‘Most Notable Launch of the Past 20 Years’ awarded by Media Industry Newsletter and Samir Husni in 2005. Chris also presided over the launch of several groundbreaking marketing campaigns, including The Cooking Light Cruise, the Cooking Light Fit House, and Cooking Light Supper Clubs.

An avid cook and exercise enthusiast, Chris lived the Cooking Light brand. He’s also a rock star: The Cooking Light band, Way Past Close, has performed throughout New York City and Birmingham to clients and colleagues.

Earlier in his career, Chris spent eight years at PEOPLE rising from salesperson to New York divisional sales manager.

Please join me in thanking Chris for his many contributions to Southern Progress and Time Inc. and wishing him the very best.”

The New York Times (NYT) is in lousy shape, so it needs to sell off About.com, the kind-of-portal, kind-of-blog-aggregator it bought from Primedia in 2005. So says Jason Calacanis, whose Mahalo.com is a kind-of-portal, kind-of-blog-aggregator.

Not true, say two people familiar with the Times and About; they say the paper isn’t shopping the property.

Calacanis, who made the remarks during the most recent This Week In Tech podcast, doesn’t go into much detail about his claim. Gawker has a link to the audio, but here’s the relevant transcript, in its entirety:

They’re going to have sell About. They’ve been trying to sell About.com, from what I understand.”

NYT spokeswoman Catherine Mathis offered up the standard we-don’t-comment-rumors-and-speculation line.

That said, it doesn’t mean it couldn’t happen at some point in the future. The Times really does need money, and since About.com is both growing and profitable, it may be the most valuable asset the Times now owns.

But that’s exactly why the New York Times would be reluctant to part with it. Like it or not, About.com may well represent the Times’ future.

This isn’t the first time a Web reporter has suggested that About.com is on the block, by the way. I wrote the same thing earlier this year, and I was wrong then.