That has to be unnerving, but I can at least offer a little bit of comfort: The worst-case scenario the employees would be facing had they been purchased by private equity firm ZelnickMedia, which was also bidding for the publication.

The short version: Almost everybody gets fired.

Here’s the longer version of the plan, provided to me by a person familiar with ZelnickMedia’s bid. It sounds like a plausible idea for a PE group that specializes in turning around distressed assets–and a chilling one for anybody who draws a paycheck at BusinessWeek:

• Wind down BusinessWeek’s print business “as profitably as possible”–the company would have to honor existing subscriptions and could still sell ads in the magazine. But the focus would be on building up BusinessWeek’s Web site, which has a decent-sized footprint, though not a huge one.
• Dump almost all of the company’s newsgathering staff and outsource most of that work to Thomson Reuters (TRI).
• Employ a small handful of editorial employees–perhaps 20, down from the 200-plus who are there now. Some of them would run a Huffington Post-style aggregation site that produces no original content, and some more expensive hires would produce a smattering of high-quality reporting and writing designed to burnish/sustain the BusinessWeek brand. “Just to give it uniqueness and sizzle,” my source tells me.
• Dump most of the existing business side, as well, but overhaul and bulk up the sales force.

The insult-to-injury kicker: Under ZelnickMedia’s proposal, the buyer wouldn’t pay a dime for the publication it intended to rebuild. Instead, McGraw-Hill would pay the fund to take the publication off its hands. If that sounds implausible, consider that McGraw-Hill just announced that it will save up to $25 million next year by not owning the title.

Given the above terms, it’s easy enough to see why McGraw-Hill ended up going with Bloomberg. For starters, the winning bidder actually paid cash for the magazine, and McGraw-Hill will end up netting a $5.9 million gain, after taxes, on the deal.

Also important: McGraw-Hill won’t have to anguish as it watches one of its flagship properties get dismantled.

So what will happen to BusinessWeek now that Bloomberg owns it? Nothing nearly so drastic, at least in the short term. For now, Bloomberg is talking about bulking up the title, not shredding it, so that’s a good sign for both employees and readers.

Alas, Bloomberg can’t take on all of the magazine employees looking for jobs, and that pool is only going to get bigger.

Forbes slashed deep into its staff this week, and next week Time Warner’s (TWX) Time Inc. will lay out some of its layoff goals. I’ve heard Time Inc. employees refer to layoff plans as “tree-trimming” or “surgical,” but I think the trimming will feel much blunter to the folks who lose their jobs. The publisher’s cost-cutting plans include hundreds of layoffs–something likely similar to the cuts the publisher went through last year, I’m told.

The New York Post’s Keith Kelly reports today that Time’s News and Finance unit, which includes Time, Fortune and Sports Illustrated, will be particularly hard hit, and I’ve confirmed that myself.

UPDATE: No surprise here: BusinessWeek President Keith Fox is stepping down. Mild surprise: He’s staying on at McGraw-Hill. Here’s his memo:

When we announced that McGraw-Hill was exploring strategic options for BusinessWeek, I promised to communicate with you as openly and often as I could. In this spirit, I wanted each of you to know that I will be remaining with McGraw-Hill after the deal with Bloomberg is closed. I will continue to play a role in the integration post-close and plan to take on a new role at McGraw-Hill in 2010.

During this process, our collective goal was to find the best buyer for BusinessWeek. I am proud that I played a role in ensuring that BusinessWeek has a new home at Bloomberg, where it will thrive under the leadership of Norman Pearlstine. I am committed to the transition and helping in any way that I can.

It’s been a privilege to be the President of BusinessWeek. I thank Terry McGraw for his confidence and trust in me and Glenn Goldberg for his support, direction, clarity, and sense of humor. I’ve also been a member of an amazing team which has navigated the transformation of the media environment with agility, focus, passion, and integrity.

The team–Steve Adler, Jessica Sibley, Tania Secor, Linda Brennan, Roger Neal, and Carl Fischer–is the best in the industry. Like BusinessWeek, they have bright futures ahead of them. I will miss the daily interaction, but I am wiser (and a little grayer) because of their collaborative spirit and desire to make BusinessWeek the global leader in business that it is today.

I also have a special thanks to Patricia Hipplewith, my assistant, who juggled my calendar, protected me from solicitors, and kept me on schedule and well fed! She is the personification of commitment and integrity.

I am humbled by BusinessWeek’s 80-year history. Thank you for allowing me to play a small part in it.

Keith

Remember a month ago, when the New York Times (NYT) said it had reached an agreement with a holdout union at the Boston Globe, which would prevent a shutdown of the Times-owned paper?

Scratch that. Deal’s off.

The Newspaper Guild, which represents some 600 editorial employees at the Globe, narrowly rejected the agreement tonight, forcing the ball back into the Times’ court. The Times had said it would need to shutter the Globe if it couldn’t extract $20 million in savings from the Globe’s unions. And, the Guild was supposed to provide $10 million of that via the proposed deal, which included an 8.4 percent pay cut. The Globe’s management had previously said it would cut pay 23 percent if the union rejected the deal.

The Times, which paid $1.1 billion for the Globe in 1993 (a year before the Netscape Mosaic Web browser launched) has argued that it needs to hack out big savings from the paper because it’s on track to lost $85 million this year.

But this interesting take by Poynter Media analyst Rick Edmonds argues that that figure overstates the case, since that total includes one-time charges, and paper losses for depreciation, etc.

Statement from Globe management:

We are disappointed that in a close vote of 277 to 265 the Boston Newspaper Guild did not ratify the Globe’s final proposal. As we have stated, the $10 million in cost savings from this multifaceted proposal is essential to The Boston Globe’s financial future.

This evening we have sent a letter to the Guild stating that as a result of the rejection of this proposal, we have reverted to our alternative Final Record Proposal which provides for a 23% wage reduction for all Guild members.  This will secure the $10 million in costs savings needed from the Guild and will allow the Globe to reach the targeted $20 million in savings needed from all our major unions.

Since the parties are at an impasse, the Globe will implement the wage reduction effective next week.  We have told the Guild that we are available to meet any day this week to review implementation of the pay cut.

We regret having to take this action, but have no financially viable alternative.

Sure, fabled magazine publisher Condé Nast has been forced to shutter magazines and trim its staff. But now you know things have really gotten dire: It’s cutting back on cars.

The New York Post’s Keith Kelly says that top Condé editors are eschewing the use of chauffeured autos to make their way across Manhattan and beyond.  Hailing a taxi or even–gasp–riding the subway are as symbolic as it gets at Condé, where the use of a car was considered a birthright, even for mid-level employees.

Alas, symbolism is unlikely to suffice at Condé, where CEO Chuck Townsend has already announced that the company will need to tighten its belt again this spring; Condé is reportedly gearing up for another round of layoffs.

Meanwhile, other New York publishers who never doled out that much largesse to begin with are probably going to make another round of cuts themselves this spring.

Layoffs stink no matter where or when they happen. But since I worked at Forbes for many years and know many of the folks who lost their jobs, today’s news hits particularly close to home.

The best thing you can say about this is that combining the two operations makes plenty of sense on paper, and could ultimately make for a better company if handled correctly. Best of luck to everyone who left today.

Statement from the company:

Today Forbes completed the integration of the editorial staffs of Forbes magazine and Forbes.com. We believe this restructuring and pooling of talent will maximize and benefit the editorial content for Forbes’ 40 million worldwide audience.

The current economic situation for media in general has caused Forbes Media to trim budgets on both the editorial and business sides of the company. Today 19 people from editorial were laid off.”

[Image Credit: Matt Krause]

Somewhere along the line those plans have been scrapped, and the five people who were working on the site (now for CBS, which bought CNET for $1.8 billion this summer) have been laid off. Among them: Craig Marks, a music writing vet who once edited Spin and Blender (where he threw me a couple freelance assignments, if I remember correctly).

Idolator’s Maura Johnston alerted us to the story, and we’ve asked CNET for details, etc. But for now this blog post from former Juke employee Tom Breihan will suffice:

Hey, remember that secret website I was going to do? Well, I’m not. I just got laid off, along with the other four people working here. CBS, who bought CNET, are killing the thing, for reasons that might have something to do with them dumping truckloads of money into Last.FM and might also have something to do with we’re in a f—ing great depression. Awesome. So: new plan. Starting tomorrow, I am going to start beasting the freelance circuit. If you’ve got work, please give me some. (Also give some to Ryan Dombal and Andy Greenwald. But give me more.)”

[Image Credit: Jennaddenda]

After asking about 100 editorial employees to give up their jobs today, Time Inc. announced a round of involuntary job cuts: Time Warner’s (TWX) magazine publisher said it is firing 92 people in an overhaul of its consumer marketing and sales group.

Time Inc. hasn’t ever formally announced the number of cuts it intends to make this fall, but company officials say the New York Times’ report that pegged the number at 600 to be a reasonable estimate. By that count, there are another 400 or so positions that will disappear in the coming weeks.

Below, the reorg memo from consumer marketing and sales EVP Brian Wolfe, who reports directly to Time Inc CEO Ann Moore (pictured) and oversees a team that sells across all of the company’s titles.

TO: Time Inc. Consumer Marketing and Sales
FROM: Brian Wolfe
RE: Reorganization

I’d like to provide further detail regarding our new Consumer Marketing & Sales organization.

These changes were driven both by the current economic landscape, as well as the opportunity to be more focused on activities that drive our bottom line.

Each of our magazine and digital properties will be assigned to a brand leader, who will set strategic direction for our consumer activities and manage the P&L for their respective magazines. Their focus will include net paid and rate base planning, research, relationships with edit and ad sales, audience development, branding, and newsstand. Titles that already have substantial partnership volume will maintain partnership sales/operations teams; the balance of partnership activities will be managed by Synapse. Each brand leader (VP) will manage a ‘group’ of magazines, which align with the 3 different business units that Ann Moore detailed in her memo 2 weeks ago. Consumer Marketing activities for all U.S. Time Inc. magazines will now be managed in New York.

VP’s of each of the business units are detailed below for the print publications and related websites:

· Holley Cavanna, Vice President, Entertainment Weekly, InStyle, Essence
· Steve Crowe, Vice President, Southern Living, Coastal Living, Southern Accents
· Carrie Goldin, Vice President, Real Simple, All You, This Old House
· Matthew Hoffmeyer, Vice President, Fortune, Money, Fortune Small Business
· Holley Klingel, Vice President, Sunset
· Jennifer Ogden-Reese, Vice President, People, People en Espanol, Stylewatch
· Jose Perez, Vice President, Cooking Light, Health, Cottage Living
· John Reese, Vice President, Sports Illustrated, Sports Illustrated for Kids, Golf
· Nate Simmons, Vice President, TIME, TIME Canada, Time For Kids

As you know, consumer marketing has played a key role in the past 2 years in helping to drive growth in our digital audiences. The role of consumer marketing in supporting Time Inc.’s digital growth will only increase in the future. Reflecting that goal, each business unit will be supported by an audience development expert who will report directly into their business unit VP. Reporting on our magazines digital activities has also become a key skill in consumer marketing. We will continue to provide this critical function for our websites by forming a digital reporting team, which will report to Holley Cavanna. In addition, Michael Dub’s audience development and analytics team, which was formerly part of TII, will now be part of consumer marketing and will also report to Holley Cavanna.  With this entire digital team in place, I feel very confident about our ability to apply our skills and expertise to this critical piece of Time Inc.’s future growth.

Going forward, all of our marketing efforts will be centralized in a team led by Sarah Jack, Vice President, Marketing. Sarah’s team will manage the new business and retention activities for all of our magazines. There will be a new business and retention director reporting to Sarah and each business unit will have a new business and retention manager and associate to support their marketing activities. This group represents the best marketers in our division and will enable us to further develop and leverage expertise in these areas. I expect this team to develop a balanced testing agenda, share best practices and results, and be singularly focused on bringing the best marketing possible to our brands. Our multi-title marketing efforts, which have continually resulted in volume growth at Time Direct Ventures (TDV) in recent years, will be managed by a team which will now report in to Sarah. In addition, an agency department and our List Rental team, led by Christine Slusarek, will also report to Sarah.

Jeff Blatt will continue in his role as TDV President and will manage a group that will focus on continuing to grow our fundraising and scouting volume. In addition, our Maghound team, led by Dave Ventresca, will continue to report to Jeff.

Sarah Jack, the brand VPs, Jeff, in his role as TDV President and Synapse CEO, Time Warner Retail (TWR) CEO & President Rich Jacobsen, and QSP CEO & President Kerry Hatch will all report to me.

As I mentioned last week, Howard Rosen has joined our team as SVP, Group General Manager, reporting to Howard Averill, Time Inc. CFO.  Reporting to Howard will be:

· Sean McDermott, Vice President, Finance.  Sean will continue to be responsible for the roll-up of our consumer marketing financials and will also manage a centralized group of planners, who will be assigned to individual business units.  In addition, Sean will manage the consumer marketing business office.

· John Tighe, Vice President, Promotions, Production & Operations.
· Scott Breininger, Vice President, Marketing Operations, which includes Online Operations, Payment, Database Marketing Services, Telemedia and Fulfillment.
· Bill Miller, Executive Director, Legal

Also reporting to Howard will be the CFOs of TWR, Synapse and QSP as well as our customer service and fulfillment operations in the United States and abroad, led respectively by Tim Adams and Sue Knights.

Howard’s groups will now support activities for all of Time Inc.’s U.S. magazines. These departments have historically been a critical part of our competitive advantage, and their continued expertise and excellent work will remain key components to our future growth.

The changes we announced today represent a significant departure from the way we currently operate. Critical to our future success will be the following principles:

We will be a marketing and operations division. We will meet our financial and compliance objectives, but will spend far less time on financial reporting and variance analysis. Ownership and reporting of the P&L will reside solely within our division. We will bring extreme focus to marketing and innovation and to the execution of our marketing plans. By doing so, we will continually improve our P&L.

We will have relentless focus on activities and levers that drive the business. We;ll have to prioritize and make difficult decisions on how we spend our time and allocate our resources. We need to be diligent about setting goals and not be distracted by requests or activities that are not in direct support of these goals.

We will need even greater emphasis on teamwork and collaboration. We are already good at sharing information and leveraging best practices. Success depends on our ability to be comfortable working well within and across functions and teams. We will also need to be great partners with the management teams of the 3 new Business Units that have been formed at Time Inc.

For our staff, this structure balances the ability to work on our brands, while continuing to improve skills and grow expertise in each of your functional areas.

We have a lot to be proud of. We work for a very profitable company, with incredible brands and talented, smart people. Our division makes a significant contribution to Time Inc.’s bottom line. Our circulation profits are higher this year, when most other print publishers are in decline. And we have continued to launch new products and innovate despite a tough economic environment.

As we move forward in this new organization, we do so without many talented colleagues and friends in New York, Birmingham and Menlo Park. These decisions are never easy, nor are they taken lightly. Please join me in thanking them for their contributions to consumer marketing and Time Inc. and in wishing them well as they move on to the next chapter in their careers.

I have tremendous confidence in this new structure, our people, and our ability and determination to meet our goals. I look forward to working with each of you to successfully grow our business.

Brian”

Last month, the Time Warner (TWX) magazine unit announced a sweeping reorg that is expected to cost about 600 employees their jobs. But the details have yet to be announced.

That started changing today, but my understanding is that the cuts won’t be accomplished with one swing of the ax, which is unfortunate for everyone involved.

Today’s memos will at least add some clarity, and I’ll republish them here as I get them, with your help. As always, I keep all correspondence anonymous: peter@allthingsd.com.

So far I’ve collected memos from four of the five titles, but am still looking for details on Money. Time, SI, People and Fortune are looking for 90 volunteers to leave their jobs.

Bear in mind that these memos only deal with editorial jobs. I’m assuming there are also significant cuts planned on the business side. Details as I get them.

[UPDATE: Some cuts on the business side, too. The company has laid off 92 people from its consumer sales and marketing group.]

Fortune managing editor Andy Serwer doesn’t spell out the number of volunteers he’s looking for in his note, but I’m told he informed staff today that he needs about a dozen positions eliminated:

Unfortunately, we will need to reduce staff at Fortune in the writer-editor, writer-reporter, designer, editorial assistant and copy coordinator Guild categories, and we are asking for a number of volunteers to leave the company with a severance package. If you are interested in confidentially exploring this option, please contact Dawn Dunlop in HR at [redacted] or Edith Fried at [redacted] by Friday, November 21, 2008. If we do not have enough volunteers, we will need to begin a process of involuntary layoffs. For your reference, the Company’s severance formula is in the Guild contract and is also posted on Time Traveler.”

Sports Illustrated needs 40 bodies gone within two weeks, says managing editor Terry McDonnell:

For the reasons outlined in Ann Moore’s reorganization announcement of 10/28/08, the Sports Illustrated Group will reduce the size of its staff across all properties. At the magazine, we will reduce staff in the following guild-covered categories:

• copy editors
• photographers
• designers
• photo equipment technicians
• picture catalogers
• picture researchers
• reporter-researchers
• research assistants
• writer-editors
• writer-reporters

A number of jobs not covered by the guild will also be eliminated at the magazine and across the group.

Approximately 40 guild and non-guild volunteers are needed over the next two weeks to avoid involuntary job eliminations. If the number of volunteers falls short by Monday, December 1, involuntary layoffs will begin.”

People wants to drop 18 editorial employees (via Gawker):

As part of a broad Time Inc. work force reduction, I regret to announce that People magazine will be making cuts in its editorial staff. We are looking for the volunteers to accept severance packages in the following Guild-covered job classifications:

• up to 6 reporter-researchers
• up to 4 Los Angeles-based staff members from among staff correspondents and writer-editors
• up to 4 New York-based staff members from among staff correspondents, writer-editors and writer-reporters
• up to 3 copy editors
• 1 research librarian

We are also looking for up to two Guild-covered volunteers each in the Art Department and photo department, and one in the News Bureau.

In addition to this call for Guild volunteers, non-Guild employees may inquire about the possibility of volunteering for a severance package.

I urge all those interested to contact People’s human resources representatives [redacted] for details regarding their particular package.

In addition to the above cuts, we are looking for savings from full-time staffers interested in working a four-day week (Tuesdays off) for commensurate salary. This call is voluntary, and final decisions will be made based on business needs and management discretion.

The call for volunteers expires on Dec 1. If necessary, after that we will follow the Guild contract procedure for conducting involuntary layoffs in Guild categories.

If you have any questions, please see me or your department heads.”

Time is looking for 20 volunteers (via Newsweek.com editor–and former Time employee–Mark Coatney):

Due to the corporate restructuring, we need to reduce approximately 20 staffers at TIME across the following guild-covered categories: edit traffic assistant, writer-editor, staff correspondent, writer-reporter, reporter-researcher, designer, research cataloger and research librarian.

Volunteers in these positions or any others can raise their hands any time in the next two weeks. If we do not have enough volunteers by Monday, November 24th, we will begin a process of involuntary layoffs.”

Time Inc. employees have a general idea of the magazine publishing giant’s revamped org chart.

But they still don’t know who’s staying and who’s actually going as the company, a unit of Time Warner (TWX), prepares to can some 600 workers.

That may change after this morning. CEO Ann Moore is hosting an 11 a.m. EST conference call with the troops that a tipster tells MediaMemo is supposed to explain the changes–including the layoffs–”in detail.”

UPDATE: Our original tipster was incorrect: This meeting only concerned Time Inc.’s newly formed “Style And Entertainment” group. That’s People, Entertainment Weekly, InStyle and Essence. We’re also told Ann griped about inaccurate bloggers. Ouch!. Here’s a transcript of her remarks.

Thanks to those of you who have passed along tips and information. If you want to contribute yourself, drop me a line: peter@allthingsd.com.

Yet another digital company is cutting back: eMusic, the digital music subscription service, is firing “about 10 percent” of its 100-person staff, the company says.

eMusic explains the cut by offering what has become a stock answer–things aren’t terrible, but the company is bracing for a slowdown and is cutting now so it can avoid doing it later.

But eMusic chair Danny Stein, who runs the firm’s parent company, JDS Capital Management, offers some additional color: The specific problem the company is seeing is with its 2,000 retail partners–either chains like Best Buy (BBY) or electronics companies that were bundling eMusic offers with their products.

Those companies are cutting back shipments and reporting slower sales, which has been cutting into  eMusic’s subscription business in the second half of the year, he says. But traffic to eMusic.com has remained consistent and the company will still be able to report 40 percent revenue growth by the end of the year.

“We are expecting to grow, but we’re going grow slower than we’d hoped,” Stein says. So what about next year? “Good question. Definitely double digits.”

Stein says the company may also consider lowering prices for its subscription offering ($11.99 for 30 MP3 downloads a month), but that for now, “we’re comfortable with our pricing.”

The cutbacks come just a few weeks after CEO David Pakman announced that he was leaving to join Venrock, the VC arm of the Rockefeller family.

Spokeswoman Cathy Nevins says the eMusic is looking at a “handful of very qualified candidates” as a replacement.

What prompted Time Inc. to drop six percent of its staff?

Time Warner (TWX) won’t release its most recent quarterly results until next week. But you can get a pretty good sense of how its publishing unit has been doing by looking at the numbers that Iowa-based magazine giant Meredith Corp. (MDP) just released.

And it’s grim.

Revenues at Meredith’s publishing unit, which puts out titles like Better Homes and Gardens and Ladies’ Home Journal (that ad above is from a 1972 issue) dropped nine percent in the last year, to $300 million. But ad revenues fell much more steeply, dropping 18 percent to $148 million. And operating profit plummeted 40 percent, to $33 million.

The good news in the earnings release is that there are still operating profits. But these are worrisome results.

So far this year, most of the ad-based businesses that have complained about declining revenues have pointed to weakness in the financial and auto industries. But Meredith’s publications don’t rely on those sectors for their ads.

From the release:

Companies that operate in Meredith’s endemic advertising categories–including food and beverages, prescription and non-prescription drugs, and home–have been impacted greatly by the current economic downturn. Combined, Meredith magazine advertising revenues in these categories declined over 25 percent in the first quarter, according to Publishers Information Bureau (PIB).”

Not surprisingly, Meredith says that the current quarter looks depressing too. Publishing ad revenues are “down in the high teens” it says.

So, don’t be shocked to see equally lousy news from Time Inc. next week.

[Image Credit: jbcurio]