Google’s catch of Andy Berndt, co-president of Ogilvy & Mather’s New York office, is more than another executive hire by the Web’s search advertising leader. The move is stoking greater concern within Madison Avenue’s industry of traditional advertising agencies, who fear Google may eventually compete with the creative services they offer clients in building ad campaigns.

So far, Google has won over advertisers with a better technology for buying paid search listings online and is looking for new growth from serving up more sophisticated graphic display and video ads. But where exactly will it, or advertisers for that matter, draw a line between “technological innovation” in placing and delivering ads and “creativity”?

The company said Berndt will join later this year as managing director of the Google Creative Lab, which works with other creative agencies to develop advertising using Google ad services. Trade magazine Advertising Age cast a skeptical eye on whether Google’s unit simply puts a new name to the same old ad agency business:

“The new global unit isn’t being called an agency, but any unit offering creative consultation and account services could be considered one. Interestingly, Google had been trying to lure more creative talent to the company over the past year, according to ad industry executives familiar with the search giant.”

(Reuters)
(WSJ)
(AdAge)

Keep an eye on:

• Apple has made plans to nearly double its fourth quarter production of iPhones to 2.7 million from the 1.54 million originally targeted, based on a projected resurgence in iPhone demand. (TheStreet)
  Apple also named Deutsche Telekom’s T-Mobile to sell iPhone in Germany. (Reuters)
• Time Warner will “look hard” in the next 12 to 18 months at possibly selling off its AOL dial-up Internet access business after doing the same in Europe, although CEO Richard Parsons says breaking off the unit would be difficult as it continues to contribute to traffic at AOL.com. (Reuters)
• Walt Disney CEO Bob Iger said he was disappointed by some studios’ recent decision to back the HD DVD high-definition technology format and accused them of taking “easy money” for their decision. Disney backs Sony’s Blu-ray, which had appeared to be pulling ahead of Toshiba’s HD DVD in the format war before Paramount Pictures and DreamWorks Animation SKG signed exclusivity deals in August to distribute next-generation films on HD DVD for the next 18 months. (Reuters)
• News Corp chief Rupert Murdoch on Tuesday sketched out early plans for Dow Jones & Co Inc, saying he leaned toward making the online Wall Street Journal free but had not yet made a decision. (Reuters)
• Warner Music CEO Edgar Bronfman Jr. still sees a future for digital rights management and physical product in the music industry, he raised the possibility of selling DRM-free music, in what appeared to be a softening of his previous outright opposition. Bronfman has been the most vocal of the major record company executives in his stance against dropping DRM. (Reuters) (Billboard)

(Photo: Reuters File)

Vanity Fair’s mogul watcher Michael Wolff caught a very big fish, signing a “high six-figure deal” with Doubleday to chronicle the rise of News Corp. chief Rupert Murdoch from his early days in an Australian newsroom to the helm of a global media empire.

The book is supposed to come out in the fall of 2009, plenty of time for Wolff to collect all the juicy details about Murdoch’s bid for Wall Street Journal publisher Dow Jones. Wolff’s last book “Autumn of the Moguls” was published by Murdoch’s own HarperCollins imprint, but the columnist turned to other houses to shop their boss’s bio.

Based on the press surrounding the deal, some of the cozier elements have not escaped notice.

“It’s a biography of Rupert Murdoch — the last mogul who really understands how his business works,” Phyllis Grann, the senior editor at Doubleday who is assigned to the book told Murdoch’s New York Post.

Publisher’s Weekly noted that Murdoch has agreed to cooperate with the account of his personal history and provide access to his friends in business and family, though it is not an “official” biography.

Columbia Journalism Review went a step further, saying Wolff’s recent profile of Murdoch in VF (Sub-headline: “The man who terrorized a generation of journalists may be the last mogul standing who truly loves print”) was not only the media equivalent of Botox when it comes to beautifying his record with journalistic integrity, but “had ‘book proposal’ stamped all over it.”

“I’m confident that as Wolff tucks into his explication of the tragically misunderstood Mr. Murdoch, he will give Rupert no cause to regret his decision,” wrote CJR’s Brent Cunningham.

We’re ironing and starching our hankies for a good weep.

Dear WSJ:

I have reached the end of my rope. My old bosses handed me over to an owner feared by many people in my industry. My new boss has ever greater demands that I cannot fathom or satisfy. Dare I walk out the door?

–Fed-up downtown

A hypothetical scenario of course. But when we read today’s well-written and persuasively argued “Cubicle Culture” column in today’s Wall Street Journal, we couldn’t help but wonder what inspired the discussion of when is the right time to quit one’s job with drama and flourish. Maybe it was Karl Rove’s resignation interview with WSJ editorial page arbiter Paul Gigot? Or something else? Below we cite a few favorite anecdotes from the story:

Anne Marie McClaran “had thought about quitting before, but fear had held her back. Still, after 10 years on the job, she had migraines and neck aches and was frequently irritable. ‘It doesn’t do me any good to have a secure future if I don’t have any future,’ she says. So even though she had no savings-account cushion, she walked into her boss’s office and quit.”

“Tim Orr, an ad executive who spent six years in a job he couldn’t stand before ultimately becoming self-employed. ‘I know full well I could always have tried just a little bit harder.’ … He even read books on psychological disorders in an effort to decode his boss.”

“One of John Westropp’s former managers demanded that he accomplish many tasks under an unrealistic deadline, setting him up for failure. Effectively, he says, he was asked ‘to sequence a DNA sample from my left arm within 24 hours.’”

Whatever you ask Qualcomm chief Paul Jacobs about the iPhone, he won’t talk about it. Known for swearing partners, potential partners and even prospective cleaning staff to complete and utter secrecy about its technology plans, Apple must have gotten to Jacobs too somehow. We just don’t know in what way, since Jacobs wouldn’t tell us during an interview today. 

Here’s how he didn’t talk about whether wireless chip supplier Qualcomm might work with Apple on the next iterations of the Web-browsing and music-playing iPhone: 
     

“So the thing with Apple is that if I told you anything they would get mad at me. So I can’t tell you whether I’m working with them or I’m not working with them, whether I’m talking to them or I’m not talking to them.”
    
“The problem I always have is somehow I say something and it makes a headline that I said something about Apple. So I just gave up talking about Apple.”
    
“We try and work with everybody … and we’d like to work with them. I think one of the things that people have talked about with the iPhone is that having 3G would make it have a better Internet experience.  We’d be interested in having that phone have 3G in it and if it had 3G with our chips, we’d be even happier.“

Google may rank as the top place to work in the United States, but Wall Street is taking a closer look at the hiring party after the Web’s 800-pound search gorilla reported the hefty expense tab. Jeffrey Lindsay at Sanford C. Bernstein even compared the outflow to the acts of ”drunken sailors.”
     
We’re sure that won’t halt the silver scooters parked inside Google’s primary-colored hallways or stem the never-ending snack stream at its employee mini-kitchens. But it might curb the expansion, for a little while, as all those new staff members get trained for a long work week.    

Here’s Google Chief Executive Eric Schmidt’s answers to repeated questions by analysts over the company’s headcount, according to a transcript of the company’s conference call to discuss second-quarter earnings:
    
    Schmidt’s opening remarks:
    “From a Google perspective, when we look at the quarter, one area we exceeded over our expense plan was headcount. We are very pleased with the talent that we’ve brought on board, but going forward we will watch this area very closely.”

    Schmidt after first analyst inquires into hiring:
    “What I would tell you is that we overspent against our own plan in the area of headcount, and that was — some of it was related to this bonus accrual that I talked about, and some because we hired a little faster than we had planned. 
    “In looking at it, we thought, was this a mistake or not?  And we decided it was not a mistake, that in fact the kind of people we brought in are so good that we’re happy we did this. And as I said earlier, we will continue to watch this very carefully in the future.”    

    Schmidt after second analyst asks about hiring:
    “With respect to the headcount, as I said, we ended up somewhat higher on our headcount expenses than we planned, which is the issue that Anthony asked about as well. We will watch it. We will adjust. We will be opportunistic. But we are going to be careful about that.”
    
    Schmidt after third analyst questions hiring:
    “With respect to productivity of our headcount, our headcount, especially in sales, is productive very, very quickly … it’s maybe even within the same quarter in which they are hired.”

It was all eyes on Jerry Yang on Tuesday after Yahoo reported its second quarter earnings, once again telling investors they could expect lower-than-expected revenue through the end of the year. 

By all accounts, what they really wanted to hear was Yang’s program for change since he became CEO in June, taking the helm of the Web media company he helped create more than a decade ago. Yang was short on actual announcements, but promised to map out a new strategy in the next 100 days and vowed there were no “sacred cows” immune to change at the company.     

Here’s the impression Yang said he wanted to leave with investors, condensed into six neat bullet-points, according to a transcript of the call:      

• “First, we’re committed to improve our performance. We’re working with great urgency to accelerate Yahoo’s transformation.”

• “Second, we are investing for growth. We’ll increase investments in key growth areas and de-emphasize nonstrategic businesses.”

• (We think this is Third) “We intend to improve the speed of execution. We’re driving sharper focus across Yahoo. We’ve already made a fundamental shift in the way we’re operating and more changes will come.”

• “Fourth, we plan to create value through our ecosystem. We’ll develop the most open, vibrant online marketplace for our consumers, advertisers, publishers, and developers.”

• “Fifth, we plan to define in order to develop platforms that enable us to scale, innovate, and open up Yahoo to our partners and consumers.

• “And sixth, I am committed to develop our talent and culture. We will set that high bar to create a winning Yahoo culture.”

We knew that kids are so wrapped up in dressing their avatars as nymphs and warlords or filming themselves in a rec room to post on MySpace that they don’t have time for Congressional resolutions on how many more soldiers to send to Iraq.

We had a feeling that more people read about and formed an opinion about Paris Hilton getting out of jail early, then going back to jail, then leaving jail (and getting her hair extensions replaced) — than about the departure of Tony Blair from British politics.

But a new study from Harvard University’s Shorenstein Center paints perhaps the bleakest picture we’ve seen about the U.S. appetite for news.

The Harvard study suggest that readers are moving to the Internet, period, and a large number have no interest in news whatsoever.

The report overturns the public assumptions of newspaper families like the Sulzbergers, the Bancrofts and maybe even Rupert Murdoch.

Media’s biggest moguls have invested hundreds of millions of dollars in online operations on the assumption that readers are “shifting” to the Web from newspapers for their news, particularly the younger generations, and that this is just an era of growing pains.

Here are some of the key findings of the 25-page report by Thomas Patterson, a professor of government and the press at Harvard’s John F. Kennedy School:

The large fact about teens and young adults is not that they are heavily dependent on new media but that they partake only lightly of news, whatever the source. A shift in sources is occurring, and it is in the direction of the new media, but the larger tide has been the movement away from a daily news habit.

The Internet cannot be faulted for the decline in news interest among young adults. Other factors, including a weakening of the home as a place where news habits are acquired, underlie this development.

Our findings suggest that some news surveys have overestimated either the amount of news young adults consume or the capacity of non-traditional media to take up the slack from young people’s flight from traditional news sources.

Here are some of the numbers, based on a survey of 1800 teens aged 12 to 17, young adults aged 18 to 30 and older adults aged 31+:

* 60 percent of teens, 48 percent of young adults and 23 percent of older adults say they pay little or no attention to daily news coverage.

*Of respondents who said they had been exposed to major news stories, only about 40 percent of them could actually recall the key factual element of the story when asked.

*When it comes to hard news on politics or public affairs, only 45 percent of respondents said they were aware such stories. By comparison, 75 percent said they were familiar with softer celebrity or human interest stories, such as the death of Anna Nicole Smith.

*Segmented by age, 54 percent of older adults said they were aware of the main hard news stories and 83 percent said they were familiar with the soft news items. That compared with 24 percent of teens for hard news and 66 percent on soft news.

“Star” magazine readers think Paris is a big crybaby and got off the hook just because she’s a celebrity, according to early results of an impromptu poll on the glossy’s Web site today.
 
Tabloid queen Bonnie Fuller told Reuters that up to 90 percent of people who have responded think Paris should have sucked it up and served her 23 days of jail time for violating probation in a drunk driving case, instead of getting off the hook after three days.
 
A spokesman at the Los Angeles County Sheriff’s office said the party-loving heiress was “reassigned” to a 40-day home confinement for unexplained medical reasons.
 
But Paris’s early release could come back to haunt her, because even the most devoted fans like to see some shred of nobility and courage in their pop idols, said Fuller. 
    
Fuller, who is chief editorial director of “Star” owner American Media Inc., had this to tell us about the whole affair, first reported on celebrity gossip site TMZ:
 
On Paris:
Paris got a prison break. It’s like a prison break where she didn’t even have to have a map of the prison tattooed all over her body to break out.
 
What we’re hearing is they were worried about her mental state. We put up a poll for our readers to answer and 90 percent think she shouldn’t have been let out of jail early. 92 percent think she got special treatment because she’s a celebrity.
        
I think she absolutely got special treatment … She’s out after three days because apparently she was crying a lot.    
   
She also could suffer from backlash. We were certainly hearing that she was going to pen a book about her experiences in jail … We’ve reported in Star that her fee for her club appearances after coming of jail, she probably could have commanded double the fee. I don’t think either of those opportunities will happen for her.
   
[Hilton’s fans] won’t feel that she served her debt to society. … People feel that she could have stuck it out for the 23 days and served her debt to society and also really come to a realization that what she did was wrong. You cannot drink and drive.
    
On Mel, Naomi and other celebrity bouts with the law: 
This year we have heard about more celebrities having run-ins with the law. Certainly it’s not a good message and yes I do think the message that a lot of people are going to take away is that it looks like celebrities are above the law.
    
On facing Web competition for celebrity news:    
It’s very much changed they way we do our business, particularly in the last year and a half to two years. With every story that comes in you have to ask yourself whether that’s a story that can hold for the magazine. Do you have exclusivity for it or do you “Web” it immediately?
    
Despite the growth of Web sites, the celebrity news weekly sales have remained just as healthy. We’re serving different purposes. You get more depth (in print). Also we have great exclusive information above and beyond what has been out already. … What you get on the Web is bits and bites. Also the Web doesn’t always cover the same celebrities.

There is perhaps no better way of understanding our future than by looking to the past. So what should we surmise by the decision of the Museum of Television & Radio, dedicated to the history of media broadcasting, to drop the reference to Television & Radio from its name?
    
The 31-year-old MTR will announce today that it will now be called The Paley Center for Media, a tribute to its founder and creator of the CBS (Television) Network William S. Paley. 
   
The museum houses one of the largest public archives of radio and television programming in the United States and hosts events at its centers in New York and Los Angeles on entertainment, business and political trends in media. 
    
Under the Paley Center moniker, it will offer more public access to its star-studded speaker lineup — which has included former U.S. Secretary of State Madeleine Albright and “Star Wars” creator George Lucas — in partnerships with the likes of Yahoo and Comcast. MTR CEO Pat Mitchell said the institution was negotiating three other content deals as well.
    
Here’s how Mitchell explained the name-change decision in an interview with Reuters:

“It says that we have evolved as the media landscape is evolving, we are changing to meet the changes of the media industry as well as media consumers. First of all, television and radio are just two of the formats by which people receive and use media. So we wanted to open our doors to all conversations about content and programming …whether on iPods or cellphones. Part of (the change) was to go to media instead of television and radio so we were all encompassing. 

Additionally, we’re really not a museum. We have a great collection and we’ll continue to collect … but we don’t have exhibitions as such. We thought a ‘Center’ is a more appropriate description. Most of our work is really convening the public around themes of media.  

Next week we are convening our first international council meeting of global media executives … in Silicon Valley, and our hosts are Google and Yahoo and Sun Microsystems. So I think this is also reflective. We also want that community represented here.”

We’re still trying to come to terms with Microsoft’s $6 billion acquisition of online marketer aQuantive Inc., but just like staring into the sun for too long it’s hard to think about it without melting your eyeballs.

So we spoke to Rishad Tobaccowala, the digital advertising guru who heads the Denuo consultancy at Publicis Groupe SA and let him work out the “New Media Math”:

Rishad on what it means:

“Everyone knew that the ultimate was to try to do what Google was doing in search … The next generation of money that’s going to come into the Internet is going to come from two places, from local and from television. The mass marketers are likely to basically require search, but they won’t put all their money in search because they don’t have products and services that lead to high click (rates).
Given where the future of electronic advertising is they also basically begin to have the platform for all advertising … Microsoft basically had nothing. They were not a player in search, not a player in display, not a player anywhere.”

Here’s what happens now:

“One thing people are going to have to get used to is that this is a world where the lines will never be clear again. Because digital is mashup, you’re going to have a buyer who is also a seller, a competitor who is a friend. The tech industry has always been like that. Intel partnering with Microsoft and competing with Microsoft. What you’re going to basically have is the same weirdness and so the reality of it is we’re all going to have to get used to the fact that Microsoft sells media and has ownership of a competitive ad agency.”