This seems to have been a busy week for Demand Media CEO and founder Richard Rosenblatt (pictured here), with news of a big-banker hiring in a pending IPO of his social media start-up and the possible sale of a digital marketing company where he serves as chairman.

Indeed, Demand has hired Goldman Sachs (GS) to prep its initial public offering, sources told BoomTown, which the company is expected to file in August at a valuation of about $1.5 billion.

This confirms an earlier report in the Financial Times.

The price has to be high, given that Rosenblatt has managed to raise an eye-popping $355 million from a slate of high-profile backers, including Goldman Sachs, Oak Investment Partners and well-known media investor Gordon Crawford.

Rosenblatt essentially signaled his intent to move to the public markets with the recent nabbing of high-profile advertising exec Joanne Bradford from Yahoo (YHOO).

Her job: To quickly turbocharge Demand’s business as chief revenue officer. The company now does about $250 million in annual revenue, mostly from advertising.

Rosenblatt, who was part of the team that sold MySpace to News Corp. (NWS) for $650 million, could also be about to score another big-time sale.

This time, it is digital marketing firm iCrossing, sources said, in a deal with media giant Hearst Corp., which could close in the next two weeks, if all goes well.

First reported in The Wall Street Journal, the price for the large Scottsdale, Ariz.-based firm is hovering at about $375 million.

Not coincidentally, with Rosenblatt in common, iCrossing shares investors with Demand, including Goldman Sachs and Oak.

Here’s hoping Rosenblatt will be able to talk about all this and more in an onstage interview at the eighth D: All Things Digital conference this June.

He will appear in a session at D8 with former Wall Street Journal editor Paul Steiger, who is trying to save investigative journalism at a nonprofit called ProPublica.

The less lofty content created by Demand and others, such as AOL (AOL), using algorithms and other means, has attracted controversy, with worries about its impact on the traditional media business.

This seems to have been a busy week for Demand Media CEO and founder Richard Rosenblatt (pictured here), with news of a big-banker hiring in a pending IPO of his social media start-up and the possible sale of a digital marketing company where he serves as chairman.

Indeed, Demand has hired Goldman Sachs (GS) to prep its initial public offering, sources told BoomTown, which the company is expected to file in August at a valuation of about $1.5 billion.

This confirms an earlier report in the Financial Times.

The price has to be high, given that Rosenblatt has managed to raise an eye-popping $355 million from a slate of high-profile backers, including Goldman Sachs, Oak Investment Partners and well-known media investor Gordon Crawford.

Rosenblatt essentially signaled his intent to move to the public markets with the recent nabbing of high-profile advertising exec Joanne Bradford from Yahoo (YHOO).

Her job: To quickly turbocharge Demand’s business as chief revenue officer. The company now does about $250 million in annual revenue, mostly from advertising.

Rosenblatt, who was part of the team that sold MySpace to News Corp. (NWS) for $650 million, could also be about to score another big-time sale.

This time, it is digital marketing firm iCrossing, sources said, in a deal with media giant Hearst Corp., which could close in the next two weeks, if all goes well.

First reported in The Wall Street Journal, the price for the large Scottsdale, Ariz.-based firm is hovering at about $375 million.

Not coincidentally, with Rosenblatt in common, iCrossing shares investors with Demand, including Goldman Sachs and Oak.

Here’s hoping Rosenblatt will be able to talk about all this and more in an onstage interview at the eighth D: All Things Digital conference this June.

He will appear in a session at D8 with former Wall Street Journal editor Paul Steiger, who is trying to save investigative journalism at a nonprofit called ProPublica.

The less lofty content created by Demand and others, such as AOL (AOL), using algorithms and other means, has attracted controversy, with worries about its impact on the traditional media business.

Under the deal, which is in the final stages of negotiations, iCrossing, one of the nation’s biggest independent digital-marketing shops, is likely to fetch about $375 million, plus bonus payments if it reaches certain targets, these people said.

Digital-marketing firms help companies pitch their products on the Internet, via cellphones and through other interactive channels. They have attracted particular interest from ad agencies and others as marketers shift more of their ad dollars from traditional media to the Web.

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After its official unveiling on Feb. 9, the e-book reader started shipping on Monday, and actually managed to grab much–but not all–of the hype that’s surrounded Twitter of late. The device has been met with much acclaim, though it’s by no means unanimous. Jeff Bezos made an appearance on “The Daily Show” Monday night to make his pitch to an as-yet unimpressed Jon Stewart. His main sell? “We’d make it cheaper if we could.” Roy Blount Jr., President of the Authors Guild, isn’t thrilled about the Kindle either, but his objection isn’t price–it’s that he believes the text-to-speech feature on the device threatens the audio book market. Rather than engaging in battle with the Guild, Amazon (AMZN) decided to modify the Kindle’s software to make text-to-speech optional. Meanwhile, the Hearst Corporation announced development of its own “Kindle Kopy” aimed at capturing the newspaper and magazine market. The Kindle 2 itself has been shipping for just a week and it’s already gotten some print media looking over its shoulder. It remains to be seen, though, whether it’ll earn the moniker of “iPod for books.” Walt Mossberg’s comprehensive review of the device this week provided a glimpse into its actual pros and cons and some insight into the Kindle hubbub from a hands-on perspective.

Elsewhere, much of the news this week was about reorganizations in the digital space. BoomTown covered the much-anticipated Yahoo (YHOO) reorg, which was sketched out by CEO Carol Bartz for employees first in a post to the company blog, then elaborated upon in not one, but two, internal memos. Even BoomTown’s attention began to wander there toward the end. Must’ve been something in the water this week, because Time Warner’s (TWX) AOL kicked in a little reorganization of its own–CEO Randy Falco announced that Maneesh Dhir, head of AOL International, would be leaving the company and returning to his entrepreneurial roots, and ad head Greg Coleman announced a reshuffling of his own group. Over at News Corp. (NWS), upon official announcement of President and COO Peter Chernin’s departure, CEO Rupert Murdoch alluded to a reorg sometime in the future, and an immediate commitment to “streamlining” the business.

In Mossberg’s Mailbox this week, Walt answered questions about transferring data to an iPhone, giving Vista a dedicated graphics card, and using TrueSwitch to transfer email accounts when switching ISPs. And in the Mossberg Solution, Katie Boehret took a look at the ways different mobile companies back up your data and give you access to it.

More next week.

Hearst said the Chron lost more than $50 million last year and that “this year’s losses to date are worse.” The company said the paper has had “major losses” each year since 2001.

The statement is basically a warning to the Chronicle’s unions that they can either play ball or watch the paper go up in flames.

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[UPDATED: With Hearst press release confirming the move at the bottom.]

Neeraj Khemlani (pictured here), Yahoo’s general manager and executive editor of news, is set to leave his job–right in the midst of a major restructuring of its media unit–to work at Hearst Corp.

Khemlani’s departure was announced to his staff at Yahoo (YHOO) today and confirmed by the press release from Hearst below.

While Khemlani was in line to head one of the three main prongs of the new content organization, running a possible network programming arm, sources inside and outside Yahoo said he instead has opted to take a job as VP and Special Assistant to the CEO for Digital Media at Hearst.

Khemlani is not leaving due to the upcoming changes at Yahoo, said sources, but because he got a “compelling” offer to work for a more traditional media company in a range of businesses, from newspapers and magazines to broadcast, helping turbocharge their digital efforts.

Khemlani, who came to Yahoo from a long stint as a producer at the television news show “60 Minutes,” will be reporting to the privately-held media company’s vice chairman and CEO, Frank Bennack.

Khemlani, several sources said, told his bosses at Yahoo–U.S. Audience head Jeff Dossett and U.S. EVP Hilary Schneider–on Friday of his plans right when the pair were in the midst of planning a major shift in how media are managed and created at Yahoo.

At Hearst, he will be a resource for its many divisions, which all have their own digital operations, and he will be based in New York. (Khemlani currently has been working out of Yahoo’s media offices in Santa Monica, Calif.)

In a press release from Hearst, Bennack said: “Hearst’s major operating groups have all made substantial progress towards our corporate objective of fully participating in the digital transformation. The creation of this new position is designed to accelerate the progress through greater cooperation and synergy across divisional lines. Neeraj is uniquely equipped to help me and my colleagues realize that goal.”

Ironically, Hearst has a strong relationship with Yahoo, as a content partner.

UPDATE: In a Hearst press release Khemlani said: “I am delighted to join Hearst Corporation. We are witnessing the reemergence of content and media driving value in the new world and Hearst is uniquely positioned to realize that value across multiple digital platforms and distribution points. Remember, we’re only in the second inning of the Internet. Hearst, with all its assets and investments, expects to take a commanding lead by the seventh?inning stretch.”

As BoomTown reported yesterday, the management of the media unit is about to be rejiggered dramatically.

It’s part of big changes coming for Yahoo, including an even more massive management reorganization that new Yahoo CEO Carol Bartz could announce this week, as this column reported on Friday.

Under a plan being considered, the media unit will be split into three parts: vertical programming, network programming and search monetization.

This comes after some other recent changes in the way media product development is done–moving to a centralized global structure, rather than residing in individual media units–which was also reported here last week.

Now, if they go through with current plans to reorganize the media unit, Schneider and Dossett must find another head of network programming.

Several inside sources said that vertical programming will probably roll up under current Sports GM Jimmy Pitaro. And Tim Mayer–who is now VP of search monetization and distribution–would probably remain in his job, with perhaps even more monetization duties added.

Here is the Hearst press release about Khemlani:

HEARST CORPORATION NAMES NEERAJ KHEMLANI VICE PRESIDENT & SPECIAL ASSISTANT TO CEO FOR DIGITAL MEDIA

Hearst Corporation (www.hearst.com) is one of the nation’s largest diversified media companies. Its major interests include ownership of 16 daily and 49 weekly newspapers, including the Houston Chronicle, San Francisco Chronicle and Times Union; as well as interests in an additional 43 daily and 72 non?daily newspapers owned by MediaNews Group, which include the Denver Post and Salt Lake Tribune; nearly 200 magazines around the world, including Good Housekeeping, Cosmopolitan and O, The Oprah Magazine; 29 television stations through Hearst?Argyle Television (NYSE:HTV) which reach a combined 18% of U.S. viewers; ownership in leading cable networks, including Lifetime, A&E, History and ESPN; as well as business publishing, including a minority joint venture interest in Fitch Ratings; Internet businesses, television production, newspaper features distribution and real estate.