MediaFile

I’ve written before about the government extending aid of one sort or another to newspapers, particularly in Connecticut. Today’s semi-flip entry also takes place there.

Media-friendly state Attorney General Richard Blumenthal is threatening Tribune Co with a reading of the media ownership rules riot act over its decision to consolidate its television operations in Hartford with the Hartford Courant. He’s none too happy with the bankrupt publisher/broadcaster’s plans because they could result in job losses. He asked Tribune Chief Executive Sam Zell some pointed questions about Tribune’s plans in Hartford, Here is a PDF of the letter:

Tribune Letter Publish at Scribd or explore others:

McClatchy Chief Executive Gary Pruitt shared some details of the newspaper publisher’s operations in his speech on Tuesday at the Newspaper Association of America’s annual meeting. Here’s what he said, based on a transcript posted at the NAA’s website:

At McClatchy, 15% of our advertising revenue today comes from online. McClatchy, a company founded before the advent of electric lights, will generate nearly $200 million dollars in digital revenue this year at a higher profit margin than our print business.

What significance is this?

Fifteen percent is above the average newspaper publisher’s take from digital $200 million would be almost enough to run The New York Times’s newsroom operations for a year. Not bad.

Higher profit margins than print? We know Gary is a big fan of pop music to highlight his industry presentations, and that he likes the Rolling Stones in particular. Maybe “Time Is on My Side” would be a decent choice for those kinds of numbers.

Newly launched international news service GlobalPost.com had a good first quarter and sees positive signs for the rest of the year, including coming in under budget and raising more money to finance its operations. That’s not bad, and looks all the better considering how the news business is under assault these days. Oh, and it aims to be cash-flow positive by the fourth quarter of 2011.

Here is a quick reminder of what GlobalPost is, lifted from a story I wrote about it earlier this year:

With 65 correspondents in 46 countries, GlobalPost will have its own website and sell news to papers whose readers want in-depth, analytical stories that supplement what they get from news wires such as The Associated Press, Reuters and Bloomberg.

The first question one of my editors asked me on Friday night when hearing that The New York Times Co threatened to shut down The Boston Globe was whether it was a negotiating tactic. That’s an easy one, for sure. Unions causing you problems at your business? Need to cut costs? Threaten to kill the whole business. It helps your adversaries reorganize their priorities right quick (Though sometimes they really mean it. Look at Hearst in Seattle).

Here’s a hypothetical recipe for how you could do it if you were running The New York Times:

You spent $1.1 billion on a paper that, thanks to the sunset on the newspaper business, is worth far less now. In fact, it’s dragging down the whole company, and you would rather let it rot than eat away at the fortunes of your flagship paper. The last time someone hinted that they would be willing to pay — about half  of what you did — you said “no.” Oops. Now no one will buy it, even though you’re also selling free tickets to see the Red Sox in the form of your stake in the company that owns the team. Tell the union reps that you need $20 million in cost cuts, that your loss on the paper will be $85 million this year and that you need it done pronto. If not, no more paper. To make it really crazy, do this on a day when the paper’s editor is across the country in Oregon, delivering a lecture to journalism students that deals with the sorry state of affairs that the journalism world is in. Wait for someone in the union to leak the threat to the nearby alternative paper that follows the Globe’s goings-on like white on rice (The Boston Phoenix in this case), then let the Globe’s editors run their own story. (PS: I won’t link to the Phoenix because it’s throwing a pop-up ad at me whenever I visit the page that invites me to download anti-virus software. I won’t inflict that pain on readers.) When other reporters call, decline comment. Watch the story go around the world. Watch a buyer emerge, someone who fulminates long and hard about civic responsibility and not letting a hallowed journalistic institution go to ground. Sell it to that buyer at a massive loss, which one of the in-house tax geniuses can find a way to write off in a way that’s advantageous to the company.

I’m not saying that the Times wouldn’t let the Globe die or that it wouldn’t be a big loss to Boston. Still, The New York Times Co wants to protect one thing: The New York Times. That’s what the Ochs-Sulzberger family’s trust is all about. The shares in that family’s trust control the company but it’s really about the paper, and it’s not certain that a huge offer to buy the company out could persuade the family to get rid of it (despite prior evidence). Heck, the Times even lists the trust as one of its risk factors in its securities filings.

There comes a time when you launch a magazine, but you don’t call it a magazine. Forbes, publisher of its namesake business magazine and luxury business title ForbesLife — and fresh off layoffs that are bruising most of the U.S. print media business – is starting ForbesWoman.

Rather than a magazine, the publisher is calling it a “brand,” which moves with the prevailing wisdom these days that you want to attract readers wherever they are, so you put the “brand” wherever it is. In that case, this means a quarterly magazine, bagged with copies of Forbes for female subscribers. It also means a website, which even a guy like me can read. In addition, it promises research, conferences and other events for its audience: women in the business world.

ForbesWoman’s press materials talk about its official launch, though it’s worth nothing that this is a retooling of something that you have seen before: ForbesLife Executive Woman, the somewhat awkardly named title that it started in 2007. Moira Forbes, daughter of Forbes Chief Steve Forbes, will publish the new magazine and Carol Hymowitz will edit it.

******We sprinkled updates into this blog. We’re highlighting them like this.******Thanks to TechCrunch, U.S. tech reporters are about to spend another weekend working instead of playing. UPDATE: Or maybe Kara Swisher at All Things D will save them!******Two sources told proprietor Michael Arrington that Google “is in late stage negotiations to acquire Twitter.” He wrote:***

We don’t know the price but can assume its well, well north of the $250 million valuation that they saw in their recent funding.

***

Twitter turned down an offer to be bought by Facebook just a few months ago for half a billion dollars, although that was based partially on overvalued Facebook stock. Google would be paying in cash and/or publicly valued stock, which is equivalent to cash. So whatever the final acquisition value might be, it can’t be compared apples-to-apples with the Facebook deal.

***

Why would Google want Twitter? We’ve been arguing for some time that Twitter’s real value is in search. It holds the keys to the best real time database and search engine on the Internet, and Google doesn’t even have a horse in the game.

This ought to be fun.

Eric Schmidt, who will keynote the Newspaper Association of America’s annual convention, runs the search engine company and advertising beast that many journalists at sick and/or dying newspapers blame for sucking up some of their advertising dollars.

(They also blame Yahoo, which touts its newspaper consortium that tries to help the papers make at least some honest dollars off ad sales)

Google also is the company that deep-sixed its program to sell newspaper advertising because it didn’t make enough money.

AH Belo, publisher of The Dallas Morning News and Providence Journal, is climbing on board the newspaper pay cut train to save money as the print business flounders.

Usually when this happens, investors sell what little of the depleted, deflated stock they already own. Today, AH Belo is up 8.7 percent. We assume that is not because they see positives in the “streamlining” of the business. The whole market is up.

This, friends, is what they call bad news.

Excerpts from Chief Executive Robert Decherd’s memo to employees:

On Tuesday, the Board of Directors approved my recommendation to reduce my base salary by 20 percent and the base salaries of other Management Committee members by 15 percent, effective immediately. In addition, all full-time employees making more than $25,000 per year will have reductions in base salary as follows:

There is no better way to learn about the art of product placement than to learn from the masters. Today, that means Microsoft Corp and the Bill and Melinda Gates Foundation, both of which were the subject of articles about how they’re delivering their messages like little pills wrapped in the sugar coating of the entertainment you consume.

Ad Age:

Can Microsoft market its way out of the search basement? Probably not, but it’s going to try, entrusting [ad] agency JWT to craft a campaign for its new search engine, alternately dubbed Kumo or Project Kiev or Live Search, depending on who’s talking about it. … The service is being tested and is expected to make its debut in the summer. … Industry executives expect JWT, part of WPP, to unveil an estimated $80 million to $100 million push for the new search engine in June, with online, TV, print and radio executions. Microsoft spent $361 million on U.S. measured media in 2008, the bulk of it devoted to brand advertising and smaller chunks to other Microsoft brands such as Xbox and MSN, according to TNS Media Intelligence data.

The New York Times:

The huge [Gates] foundation, brimming with billions of dollars from Mr. Gates and Warren Buffett, is well known for its myriad projects around the world to promote health and education. It is less well known as a behind-the-scenes influencer of public attitudes toward these issues by helping to shape story lines and insert messages into popular entertainment like the television shows “ER,” “Law & Order: SVU” and “Private Practice.” The foundation’s messages on H.I.V. prevention, surgical safety and the spread of infectious diseases have found their way into these shows.

Here’s one from my colleague, San Francisco bureau reporter David Lawsky:

The recession is good business for Volusion, whose business is demonstrating the common wisdom that some people who lose their jobs become involuntary entrepreneurs.

The company hosts Websites for businesses. Its soup-to-nuts site requires no programming experience and lets beginning entrepreneurs — or anyone — start out at $29.95 a month. Corporations pay more.

“We’ve been on a hiring binge. We definitely need people to keep up with the growth,” said Clay Olivier, Volusion’s chief operating officer.