Your Reuters media writers got a little flushed on Monday morning when we saw that Conde Nast was going to close some magazines. Would we see The New Yorker and Vanity Fair pulped? No such luck for us vultures who were craving a big murder-in-the-first-degree story. This appears to be more of a mercy killing.

Instead, here’s what we get:

• Consolidation in the bridal business. No more Modern Bride, no more Elegant Bride. Instead, we get a monthly edition of Brides magazine, the kind of phonebook-sized tome that it seems will pay for itself. After all, people love to get married, and many these days like to do it twice.
• Calorie cutting in the food format: Gourmet magazine gets purged, while the brand lives on. Or, as Media Memo’s Peter Kafka put it, it survives “Zombie-like” on TV and the Internet. Bon Appetit survives, meanwhile.
• Speaking of food, no more Cookies. Cookie magazine, the “stylish parenting magazine for the new mom,” dies. So much for news-you-can-use stories like “Parents and pot: Do you think it’s okay to smoke weed at a play date?”

Stephanie Clifford of The New York Times got an interview with Conde Nast CEO Chuck Townsend, who gave her the details of how this is going down. Since we’re not sure if Chuck will have time for us today (we’re hoping the phone rings presently), here’s what he said:

None of the about 180 employees of the magazines, including the Gourmet editor-in-chief, Ruth Reichl, are expected to stay with the company… The employees will receive severance packages this week and be out by the end of the week.

Other layoffs may be in the works. Mr. Townsend has asked editors and publishers of each magazine to meet certain budgets, and the executives can choose whether to lay off staff to get there. The executives’ plans are due in 10 days, Mr. Townsend said, and all layoffs should be completed by the end of the year.

This is it for magazine closures, he said, although he said three or four magazines were considering reducing their frequency.

“These businesses should be 25 percent net margin businesses,” he said. “We have had some underperformers, but not businesses that have cost us money to run except for launches and businesses like Gourmet that, with the economy, have slipped into the red.”

It would be nice to think that this is the end of the pain at Conde Nast, which already dumped Portfolio and home decor title Domino (the demise of the latter aroused much more indignation among Media File readers than I suspected it would), but it probably isn’t. Conde (our neighbor across the street in Times Square) is a publishing house full of big expense accounts and bigger reputations. It likely will do its best to protect marquee names such as The New Yorker and Vanity Fair, but some recent college graduate working for McKinsey as an expert consultant will figure out before too long that writing about expensive lifestyles can be done for less money. That’s something that your stylish but frugal Media File reporters have known for years.

(Reuters Photo: This is our favorite Vanity Fair magazine edition because it features Reuters founder Paul Julius Reuter, described in this 1872 profile as a man of “power and great wealth, possessing a fine house and wife and always ready to show a magnificent hospitality.”)

Here are some of the day’s top stories in the media industry:

U.S. business magazines face a shakeout (Reuters)
Robert MacMillan writes: “Business news publishers rubbed their hands in glee when the financial crisis grabbed headlines last fall, saying the meltdown would deliver a windfall blown in by widespread interest in their stories. It did not turn out that way. Appetite for news does not always translate into revenue, especially at a time when blogs, wire services such as Bloomberg and Thomson Reuters and other outlets crowd into news analysis territory that the big magazines had long claimed.”

McClatchy quarterly profit rises on cost cuts (Reuters)
“U.S. newspaper publisher McClatchy Co reported higher quarterly income on Tuesday because of cost cuts, pushing shares up as much as 67 percent, even as advertising revenue fell by nearly a third. McClatchy, publisher of The Miami Herald and Sacramento Bee, also said it reduced the amount of debt that it owes and sought to reassure investors that it will not violate the terms of its lending agreements,” reports Robert MacMillan.

Economist Group Buys Congressional Quarterly (WSJ)
Kevin Kingsbury writes: “The deal, terms of which weren’t disclosed, will create a new company called CQ-Roll Call Group. Roll Call is owned by the Economist Group, the London-based publisher of its namesake magazine. Roll Call is buying Congressional Quarterly from Times Publishing Co., whose primary operations is the St. Petersburg Times and related assets.”

James Murdoch Approved Payment to Phone Tap Victim (Bloomberg)
“James Murdoch, the son of News Corp. Chairman Rupert Murdoch, agreed to a 700,000-pound ($1.1 million) payment to a victim of phone-tapping by the News of the World, the editor of the company’s newspaper said,” writes Robert Hutton.
> Ex-Murdoch paper editor says phone taps not policy (Reuters)

Conde Nast September Monthlies Lose 1,680 Ad Pages (NYO)
“Vogue tumbled to 427 pages total, down 36 percent from last September. W is down 53 percent; Allure and Gourmet are down 51 percent; and Self is down 50 percent. Vanity Fair came in just above average for the company, dropping 36 percent,” writes John Koblin.

In other news:

• Arbitron Q2 profit up; cuts FY rev view; shares fall (Reuters)
• Meredith Invests In Mobile Firm Hyperfactory (Mediaweek)
• Journal Communications posts 2nd-quarter loss (AP)
• Vogue To Get Its Own Web Site, Too, After Condé Launches GQ.com (Business Insider)

Mary Schapiro, America's new top cop for the securities industry, said the current mass culling of journalists' jobs is a concern because it could reduce the number of leads that regulators get as they seek to crack down on nefarious behavior.

"It's an absolute worry for me because I think financial journalists have in many cases been the sources of some really important enforcement cases and really important discovery of practices and products that regulators should be profoundly concerned about," the chairman of the Securities and Exchange Commission told the Reuters Global Financial Regulation Summit in Washington on Tuesday.

"But for journalists having been dogged and determined and really pursuing some of these things, they might not be known to the regulators or they might not be known for a long time," she said.

But Schapiro, who was speaking a day after Conde Nast announced the closure of its glossy business magazine Portfolio only about two years after it launched, held out some hope for the business reporting trade. She said that some journalists should consider applying for jobs at the SEC.

"Investigative journalism actually would be a pretty interesting skill set for us to have. We've talked about financial analysis, we've talked about forensic accounting being skill sets that we really need -- understanding of complex trading, strategies and systems, but it's one of the things the SEC has to do. It has to really broaden its horizons and bring in people who think about things a little differently than it has historically."

But what would having Mr/Ms Investigative Journalist working there do for the SEC's tarnished media image? And how would a hard-nosed investigative journalist respond to all those agreements to let some of the bad guys off with a rap over the knuckles and a small fine (those infamous "did not admit or deny" settlements)?

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.

Now the Gates Foundation is set to expand its involvement and spend more money on influencing popular culture through a deal with Viacom, the parent company of MTV and its sister networks VH1, Nickelodeon and BET. It could be called “message placement”: the social or philanthropic corollary to product placement deals in which marketers pay to feature products in shows and movies. Instead of selling Coca-Cola or G.M. cars, they promote education and healthy living.

The Times story uses expert comments from the Kaiser Family Foundation, which has been doing this issue placement for years, and gave advice to the Gates Foundation about how to do this. One of the Kaiser officials told the Times that this “is not about planting a message.”

That’s exactly what Viacom must have been thinking when it was depositing Gates’s check.

Keep an eye on:

• Job cuts at Conde Nast and Forbes made an inordinate amount of news on Wednesday, even though they’ve already been gut-gut-gutting away. (MediaMemo at AllThingsD)
• Old media cable TV executives discuss strategies for making money when there’s less of it running around. (PaidContent)
• The Newspaper Association of America doesn’t generally crave publicity about the sad state of the business these days, but there’s an exception to every rule. Maybe that’s why the NAA got CEO John Sturm onto the Colbert report of all places. Our favorite part: Colbert suggested newspapers consider product-placement in stories, took a shot at the New York Times and asked Sturm: “If you’re serious about wanting to compete on the Internet, why don’t newspapers have a huge porn section?” (Chicago Tribune)

(Photo: Reuters)

We won’t be tempted by puns. Or any sort of lame wordplay.  We’ll play this straight. Seriously. Here goes: After all the bad publicity caused by a photo of Michael Phelps apparently taking a bong hit, Kellogg has decided to dump the superswimmer.

Okay, now that’s out of the way. Here’s the basics from Reuters:

The world’s largest cereal maker said on Thursday it would not extend a contract with Phelps, who charmed audiences in Beijing last year with a record-breaking, eight-gold medal haul, saying the photo of the swimmer was inconsistent with its public image.

Phelps, estimated to make millions of dollars annually from marketing deals, issued an apology this week after a British newspaper published a photograph purportedly showing him smoking marijuana during a student party at the University of South Carolina in November.

The move doesn’t come as a complete surprise. Marketers often get nervous about this sort of thing, especially when forking out big bucks in this economy. Phelps has other deals worth millions of dollars with brands including Speedo swimwear, Omega watches, Visa Inc, Subway sandwiches and Hilton Hotels. Phelps’s agency, Octagon, said earlier this week that it had been in touch with his sponsors and that none had indicated any intention of backing out of their deals.

What changed? What’s the deal with Kellogg? The difference? One marketing executive tells AdWeek that it’s all about the kids.

Kevin Adler, founder of Engage Marketing, a sports-marketing firm in Chicago, said Kellogg’s decision comes as no surprise. While others may not have gone public in their stance towards Phelps, it’s imperative that Kellogg do so because after all, the cereal maker is heavily perceived (as) a kids’ brand, he said.

“Athletes are brands. That’s the most important umbrella concept we have to understand is if you do something that runs contrary to your brand image, it will affect your ability to monetize that brand image. It really kind of is that simple,” said Adler.

Over at Gawker, they had a slightly different take.

Kellogg, in the most boneheaded move in the entire history of all celebrity endorsements ever, is dumping Michael Phelps over his pot photo. Has any brand ever been more out of touch with its customers?… Hello? This is the best possible recommendation one can make for breakfast cereal, the favored foodstuff of THC-induced munchies victims everywhere.”

Ahhh, advertising.

Keep an eye on:

• Bruce Springsteen in none to happy with the notion of a Ticketmaster-Live Nation merger (Bruce Springsteen)
• U.S. magazine empire Conde Nast has replaced the publisher of The New Yorker, as the number of ad pages tumbled during the past year (Reuters)
• Rockers, rappers and record executives gather in Los Angeles on Sunday for the annual Grammy Awards, but there is little to celebrate at the music industry’s biggest night (Reuters)

(Photo: Reuters)

April Fool’s Day is still a few months away, giving magazine publisher Conde Nast some time to pull a few practice gags. The latest is its decision to kill Domino magazine — days after appointing a new chief to run it.

Here’s the press release, sent on Wednesday:

Domino magazine will cease publication, it was announced today by Charles H. Townsend, President and CEO of Condé Nast. The final issue will be published in March 2009.

“This decision to cease publication of the magazine and its website is driven entirely by the economy,” Mr. Townsend said. “Although readership and advertising response was encouraging in the early years, we have concluded that this economic market will not support our business expectations.”

Domino was launched in April 2005. The magazine’s current ratebase is 800,000.

It is one of the latest “shelter” magazines — titles dealing with the home — to go under. (Kind of ironic, really, when so many people are spending more time at home because they can’t afford to go out anymore.)

Things were different not so long ago, the New York Observer reported earlier this month:

Back in November, CEO Chuck Townsend, in a statement through a spokeswoman, conceded that there were problems at the magazine: “Ad revenue is off at Domino like it is across the industry, but the magazine is way ahead of our original plans to circulate it in the marketplace.”

Some other reports said at the time that appointing a new “publishing director” to oversee the publisher was a sign that Conde Nast had enough faith in the magazine to keep it alive.

Just kidding!

Chalk one up for Microsoft — sort of.

If today’s report in the Wall Street Journal is right, then Microsoft is about to land an agreement with Verizon Wireless to become the default search provider on its cellphones.

In its battle with Google, that should count as a win for Microsoft, even if the company had to offer much, much better terms than its rival.

From the article: “Verizon is tilting toward Microsoft because the software giant is offering significantly better financial incentives, but the telecom company is still in discussions with Google and the situation is fluid with both companies, these people said.”

The WSJ says the deal would likely call for Microsoft to share revenue with Verizon when advertisements come up in response to a search. It reports that there would likely be guarenteed payments to Verizon of $550 million to $650 million over five years. That’s about twice what Google offered, according to the report.

If accurate, Microsoft’s super aggressive offer shows just how worried it is about Google. It needs wins, particularly when it comes to search deals.  But as Silicon Alley Insider points out, Google is under some pressure, too.

“Google is now probably getting quietly desperate, too (stock price $300), so it will be interesting to see if it panics and does something economically stupid. Probably not, but possible, given how much Google is betting on the growth of mobile.”

And so the battle rages on…

Keep an eye on:

• Dentsu, Japan’s largest advertising company, cut its annual profit outlook by 20 percent and said it would buy a U.S. ad agency as it seeks growth outside the stagnant and mature domestic market (Reuters)
• Conde Nast’s online media division laid off more than three dozen staffers from ad sales to infrastructure (AdAge.com)
• Shares in struggling Midway Games Inc. - media mogul Sumner Redstone’s pricey gamble on the video game business - sank to a fresh all-time low (NY Post) 

(Photo: Reuters)

The odds of a Google-Yahoo Web advertising deal are looking increasingly bad. The Wall Street Journal says that both sides may just drop the deal as early as next week. The reason: The Justice Department wants too many darn compromises.

From WSJ.com:

The option to scrap the deal has been on the table before, but Google in particular has begun considering it more seriously as Justice Department talks haven’t progressed. One sticking point has been the department’s discussion of having the companies sign a consent decree stating the terms of the partnership. That would subject their compliance to continuing oversight by a judge.

But dropping it next week? That seems so soon. Well, paidContent speculates that the timing could be linked to Tuesday’s presidential election. 

The thinking could be that an Obama win—which would be at least personally supported by Google CEO Eric Schmidt, an avowed Obama supporter—would probably signal a more jaundiced view of what constitutes anti-competitive partnerships. And a McCain win could mean that antitrust regulation would remain fairly loose.

Then there is All Things Digital’s Kara Swisher, who offers an interesting take on all of this. She says Google is really just playing some high-stakes “chicken” with Uncle Sam.

I would bet my Barry Manilow record collection, based on rumblings on Wednesday among those close to the case, that Google (GOOG) is a key whispery source here, sending a very public signal to the Justice Department that it would walk if pushed too far and leave regulators with egg on their faces for not letting the search giant help the struggling Yahoo.

Of course, if the deal falls through all may not be lost for Yahoo. Reuters reported this week that talks seem to be heating up again on a Yahoo-AOL deal.

Keep an eye on:

• Barack Obama’s campaign “infomercial” was the most-watched telecast in U.S. prime time on Wednesday, drawing an “American Idol”-size audience (Reuters)
• Facebook may be forced back to the capital markets much earlier than they originally planned (TechCrunch)
• Publishing empire Conde Nast is scaling back its plans for business magazine Portfolio and cutting company budgets 5 percent (Reuters)

(Photo: Reuters)

Like most intellectuals and sophisticates, I read the cartoons in The New Yorker before going on to all those articles filled with big words and umlauts. In doing that in the October 6 edition, I noticed that every one of them pertains to the financial crisis.

The New Yorker, which has made a market of acidic, sharp and occasionally opaque observances of upper-class life in its cartoons for decades, usually features a grab-bag of themes and illustrators in its pages. This is the first time that every cartoon is devoted to one topic, however.

While it’s always more dandy to read the magazine on paper, its website features a slideshow. Enjoy the meltdown.

Cartoon Editor Bob Mankoff said there was enough good material that magazine Editor David Remnick said all the submissions should reflect the turmoil. Mankoff also said he enjoys the simplicity that the cartoons bring to the complicated mix of bad debt, funny money and the complicated interdependence of the once-powerful financial firms.

“It’s not that complicated; It’s other people’s money — and you don’t care that much about it,” he said. “I think humor does act as a sort of rough-and-ready B.S. detector.”

(Image courtesy of Conde Nast/The New Yorker)

Live Nation said on Tuesday it has signed a global ‘360-degree’ deal with Canadian rock band Nickelback covering the band’s touring, recording and merchandising.

The deal was said to be in the $50 million to $70 million range over the course of the three-album/three-tour deal, according to a source.

The deal could cause some blushes at Warner Music Group. Back in December 2006 Warner paid around $73.5 million for a 73.5 percent stake in Nickelback’s label Road Runner Records — no doubt with hopes to sell many more Nickelback albums for years to come.

But Nickelback, which has sold more 26 million albums to date, still has two more albums to deliver for Road Runner and a greatest hits package,  so there’s every chance that the band’s best album years will be behind it. So this could instead end up being an expensive deal for Live Nation.

Live Nation never confirms how much it agrees to pay for its comprehensive partnerships with major artists. A deal with pop veteran Madonna, another soon-to-be former Warner artist, was reported to be around $120 million spread over ten years. It also has agreements with Jay-Z and more recently Shakira.

Live Nation management’s bet is that its comprehensive 360-degree deals will allow it to make profits in other areas beyond the recording and thereby spread its risk a little wider than a traditional recording and publishing company. The entire music industry is watching closely to see if this gamble works.

 Keep an eye on:

• NFL football team Pittsburgh Steelers is secretly being shopped to potential buyers  (WSJ)
• Washington Post appoints former Wall Street Journal editor Marcus Brauchli as its new editor (New York Times)
• Conde Nast Publications is to shut down Golf for Women (WSJ)

(Photo: Reuters)