But Condé, like other publishers, says Apple (AAPL) won’t actually talk to the company about its plans for the device, or even acknowledge that it has plans.*

Condé’s plan, meanwhile, is to create digital versions of its magazines that will work on all the upcoming tablets, using new software from Adobe (ADBE). Those tablets aren’t actually on the market yet, but the publisher says it’s confident that we’ll soon see multiple versions of machines featuring large color touchscreens and wireless connections.

So who’s going to make those gadgets? Condé Nast CEO Chuck Townsend says his company is working closely with Hewlett-Packard (HPQ) and that it has also been communicating its plans to Apple. But Townsend made a point of saying that Apple executives themselves refuse to acknowledge that they’re actually planning a tablet: “They’re not talking to anybody openly,” he says.

Adobe is creating a publishing tool for the new format, as well as magazine-reader software that may come pre-installed on the devices or may require a download. The software company says it is working exclusively with Condé now, but will offer its tools to other publishers next year.

[Important technical point several readers have brought up: Adobe says its new reader software will run using its AIR platform, which works on multiple operating systems, including Apple's desktop system. But neither AIR nor Adobe's flash software works on Apple's iPhone, so if the new mystery device runs on that operating system, there's a problem. I'm following up with Adobe to see what it has to say. UPDATE: Here's Adobe's response.]

Condé says its work with Adobe won’t preclude the company from joining the “Hulu for magazines” storefront/distribution joint venture it has been discussing with Time Warner’s (TWX) Time Inc. and other publishers. “Those discussions are ongoing and important and imminent,” Townsend says.

Okay. So what will Condé’s magazines look like once the tablets appear? The publisher has been showing a demo video to advertisers, industry executives and employees, and I’m trying to convince the company to show it to the rest of the world. (UPDATE: Here’s a partial, low-quality version of the video).

But until then, you can get a sense of it by checking out the publisher’s first attempt to port a magazine to the iPhone, which was released today at the iTunes App Store.

Like the iPhone version of GQ’s December issue, Condé says its tablet magazines will feature the same content found in the print versions, including original advertising, with the ability to view pages in their original form or in formats designed specifically for the device. They will also import multimedia content, like videos, and offer the ability to synch up with social networks and other Web sites.

Condé also thinks the business model for its tablet mags will mirror that of its iPhone app. The company intends to charge readers for each title, and it plans to convince the Audit Bureau of Circulations, the magazine industry’s standards board, that its online sales are equivalent to newsstand sales. That will allow Condé to charge advertisers the same rate as for print ads.

If all of this works, it’s a dream scenario for Condé and other publishers. The magazine industry gets to keep the revenue streams its print publications generate without having to make the “analog dollars for digital pennies” discount that the Web requires. Meanwhile, Condé gets to bask in the benefits of digital–lower distribution costs, more engagement with readers.

Or put another way: Publishers hope the new devices will repair all the value destruction the Web has wrought.

But all of this assumes that consumers, who’ve shown no inclination to pay for this stuff on the Web, will be willing to pay for it once it appears on devices no one owns yet. We’ll find out soon enough.

*One possible exception is the New York Times (NYT), where editor Bill Keller refuses to talk about possible talks with Steve Jobs and company.

It’s not clear if News Corp. (NWS) will end up investing in the joint venture, which is designed to control distribution of “print” content to readers like Amazon’s (AMZN) Kindle and Apple’s (AAPL) rumored tablet, or if the company will simply agree to tailor its stuff–most notably, The Wall Street Journal–to the joint venture’s standards.

In either case, News Corp. has yet to officially sign on, sources tell me. An announcement formally acknowledging the JV itself is supposed to be a couple of weeks away, though I have been hearing this for at least six weeks.

No comment from News Corp. or Time Inc., the Time Warner (TWX) publishing unit that has been assembling the JV. Other expected partners include Hearst, Condé Nast and, perhaps, Meredith. (Disclosure: News Corp. owns Dow Jones, which owns this Web site.)

In some ways, News Corp. is an obvious partner for the coalition, which I like to call “Hulu for magazines.” Murdoch has been an outspoken critic of Amazon’s distribution and pricing policies; he argues that by controlling the subscription of digital newspaper and magazines delivered through its e-reader, Amazon deprives publishers of a valuable asset.

Murdoch also wants more money for the stuff it does sell: In an earnings call last week, he said that while the bookseller was now paying his company up to $6.50 a month for each $15 monthly subscription to The Wall Street Journal, that split wasn’t good enough.

The JV is supposed to solve those problems for publishers by letting them control sales, customer billing and pricing. But it is also primarily designed with magazine publishers in mind, and News Corp. isn’t in that business.

Meanwhile, New Corp.’s Dow Jones unit is proprietary about the system it has already built to handle subscriptions to the Journal’s print and online editions and its BlackBerry and iPhone apps.

While it’s possible that the JV could use the Dow Jones subscription/commerce platform as the technological base of the JV, Dow Jones could be prickly if asked to play well with others. “Newspapers and magazines, don’t mix well, for reasons that aren’t obvious to the outside world,” says a News Corp. executive briefed on some of the company’s conversations.

In any event, balancing different partners’ interests is only one of the hurdles facing the JV. Some others, from the story I published last month:

• They’ll have to convince consumers who already have billing relationships with Amazon, Apple and other vendors to sign up with yet another service.
• They’ll have to convince device makers to play along with the strategy, which runs counter to many of their own plans. Both Amazon and Apple, for instance, have intentionally created closed systems that give them control of both devices and distribution.
• They’ll have to create content consumers want to buy. The new product can’t simply be a digital version of the magazines they’re already printing: That’s already available on the Web, and consumers have shown almost no interest in paying for it, and advertisers haven’t fully embraced it either.

So what exactly will the JV be selling? That’s probably the most difficult question for publishers to answer, made even more difficult because they don’t know what capabilities the e-readers of the future will boast. Apple for instance, refuses to even acknowledge to Time Inc. executives that it plans to produce a tablet device, let alone provide them with specs.

The takeaway: The site is losing traffic and money and no longer expects to get all of the $900 million it once counted on from a Google search deal. Also, the company really doesn’t know what to expect of the property going forward, except that it’s a work in progress.

So: Either digital media boss Jon Miller, MySpace CEO Owen Van Natta and the rest of the new team brought in this year to fix the site have an impossible task or expectations are now so low that even modest improvement will look like a huge victory.

Details from the earnings call, which I covered live this afternoon:

• Revenue was down 26 percent at Miller’s Digital Media Group (MySpace and a handful of other sites).
• That’s in part because conventional ad revenue is down and in part because search ad revenue is down.
• But isn’t Google (GOOG) supposed to be paying $900 million over three years in a search deal? Yes, but only if News Corp. (NWS) hits certain traffic/query guarantees, which isn’t happening anymore, says Murdoch.
• How much is MySpace going to miss by? This question occasions much confusion on the call. “I don’t know. But it will be a real figure,” Murdoch says. Then he throws out the number $300 million. His lieutenants suggest that it’s closer to 10 percent, or $90 million. I’ve since checked with News Corp. PR, which says the figure is “in the 100 [million] zone for the year.”
• So what’s the plan to fix all of this? “It’s a work in progress,” News Corp. officials say over and over during the call. Chase Carey, Murdoch’s new number two, uses the phrase at least three times in one answer.
• Any other color on overhaul plans? Nothing you haven’t heard before: The company is trying to become an entertainment portal instead of a social network. Carey: “We’re not trying to beat Facebook. We’re not trying to beat Twitter.”

(Disclosure: News Corp. owns Dow Jones, which owns this Web site).

His agency, TBWA/Media Arts Lab, is shuffling people around, however. If you’re reading this story on this Web site, you probably don’t care about the details, but you can find them here and here. The takeaway: Clow isn’t retiring, he’ll still have a hand in Apple (AAPL) campaigns, and he’s a bit bemused by the way the Internet has treated his org chart shuffle.

“Look at how the blogosphere decided to make it a conversation about me,” he writes in a letter distributed to his staff.

Psst! Big secret here: The blogosphere doesn’t really care about Lee Clow.

It cares about Apple, Apple, Apple. And if it’s an Apple, Apple, Apple story that gives the blogosphere the chance to embed some Apple advertising, too? Then the blogosphere really likes that!

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

Tough times have forced many papers to rethink their circulation strategies. An obvious conclusion: Much of the money publishers were spending to print and deliver dead trees has gone to waste. New strategy: Print fewer copies, and charge more for the ones you do sell.

That’s a tactic, not a strategy, but in the near-term it might work.

In its last quarter, for instance, the New York Times (NYT),  saw its daily circulation drop by more than seven percent, but saw circulation revenue jump 6.7 percent, due to price increases. Last spring a single copy of the Times at a newsstand jumped from $1.50 to $2.00, and a Sunday Times now costs a staggering $6. But people are buying them.

Meanwhile, News Corp. (NWS), which owns The Wall Street Journal as well as this Web site, has been steadily increasing the WSJ price. And circulation revenue is up at the McClatchy (MNI) and Media General (MEG) chains.

Again, the industry can’t shrink its way to recovery. There are fewer people paying for news–on or offline–than there have been in decades, and there’s no way to paint this as a positive. But the people who still subscribe to papers value them, and it would be foolish not to capitalize on that. Editor & Publisher:

There are several reasons as to why circulation keeps dropping, aside from former readers who have kicked the print edition to the curb. Publishers have been purposely pulling back on certain types of circulation, including hotel, employee and third-party sponsored copies. No longer are they distributing newspapers to the outer reaches of the core market. The cost of delivery and the cost of materials have forced publishers to scale back.

Another shift has occurred: volume has taken a back seat to dollars.

Several major newspapers across the country have aggressively hiked prices of single-copy and home-delivered papers in search of circulation revenue and a renewed focus on loyal readers. Circulation is guaranteed to go down as prices go up, but publishers have opted to wring more revenue from readers as advertisers keep their coffers closed.

For the record: Disney (DIS) says it always intended to move the company, which offers “bite-sized ideas for green living” via email and a Web site, from its corporate strategy group to its interactive division, which will happen later this year. At that point, “it will still continue in some form,” says spokesman Michelle Bergman.

That doesn’t sound good. Disney says it plans to conduct a review of the unit, so it’s not ready to answer some basic questions about the email newsletter company. Like: Are co-founders Heather Stephenson (who lives and works in San Francisco) and Jennifer Boulden (who until this summer lived and worked in Bozeman, Mont.; she’s now in Los Angeles, I’m told) staying on? Will Disney have to take a write-down on the property? Will there be layoffs? “It’s too early to say. I can’t tell you,” Bergman says.

Okay. But If I had to bet, I’d say at least some of the dozen-plus employees will be hitting the job market.

Disney paid a reported $20 million for the property a year and a half ago, and the plan was to create a big green-centered business around it, but that hasn’t panned out, sources said. The company, founded in 2005, is one of the many lifestyle newsletter businesses backed by Bob Pittman’s Pilot Group.

Comcast (CMCSA) bought DailyCandy, the best known of Pittman’s stable, for $125 million a little more than a year ago. That was surely one of the last “pre-Lehman” Web 2.0 M&A deals, but grunts and murmurs out of Philadelphia and Pilot indicate the business has held up during the recession. And Thrillist, a “DailyCandy for dudes” effort that has yet to sell, seems to be booming.

The perennial, and obvious, solution is to incorporate ads into the service, but so far Twitter hasn’t tried it, except for very limited experiments.

The good news for Twitter and its investors is that the service’s user base is pretty receptive to advertising, in general terms, because it’s pretty receptive to just about everything on the Web.

So says research group Interpret LLC, which has a new study out today, conveniently enough. From the release:

Twitter users are twice as likely to review or rate products online (24% vs. 12%), visit company profiles (20% vs. 11%) and click on advertisements or sponsors (20% vs.9%) as those who only belong to traditional social networking websites like Facebook and MySpace. The data suggests that Twitter users uniquely demonstrate higher engagement with brands, not just with “tweets” they post.

These statistics are self-reported, and Interpret doesn’t say how big a sample its survey used, so take them with as much salt as you like. But they seem intuitively and directionally correct: Anyone willing to plug into the waves of information that Twitter pumps out is likely engaged all over the Web.

Note what the Interpret report doesn’t say: That Twitter users are eager to have ads inserted into the service itself.

Doesn’t matter. At some point, they’re unlikely to have a choice about that because it seems hard to imagine that Twitter can ever deliver on its investors’ sky-high expectations without generating some kind of money, somehow, from Madison avenue.

Which is exactly why Biz Stone and crew, who once made a point of expressing their derision for ads, now make a point of saying that ads may not be such a terrible thing, after all.

The paper says “some readers” have seen unauthorized pop-up ads promoting antivirus software on NYTimes.com, and warns visitors who see the ad not to click on it but to restart their browsers instead. While the Times doesn’t spell this out, the newspaper has likely had its site hijacked by a “malware” scammer who is trying to trick visitors into installing pernicious software onto their hard drives.

MediaMemo reader Tim Minter passed along an image of the pop-up below (click to enlarge). Here’s his description of the way it appeared on his desktop:

The ad hijack[ed] my computer. Say I’m reading an article (the Clean Water Act was the one that caught me). It then redirects my browser involuntarily to sex-and-the-city.cn. That site then redirects to the ad I screen-captured.

At no time did I click anything. That’s what is so nefarious about this malware.

Thankfully, since I run OS X, I knew immediately it was malware (seeing WindowsXP on a Mac where that’s not installed is suspicious).

You generally have to travel farther down the Internet publishing food chain to find this kind of bogus ad–go hunting for porn and/or illegal downloads, for instance, and you’ll find plenty of this stuff.

But Web advertising is still a wild and woolly place, and this type of thing still plagues high-end publishers too. Sometimes it’s the fault of ad networks the publishers use to move their unsold inventory; sometimes the bogus ads are bought directly from the publishers themselves.

I’ve asked both the Times PR staff and ad tech team for additional information about the ads, but haven’t heard back yet. Still, you have to give the paper credit for flagging this on its front page at all.

UPDATE: The Times’ explanation: A hacker duped the paper by buying the ad directly from the paper’s sales staff, then disguising it as a legit ad for a week.

Finke moved Deadline Hollywood Daily, her one-woman operation, from LA Weekly to Penske’s burgeoning Web empire in June. At the time, she promised to hire a “senior” journalist, based in New York City, within three months.

Now Penske tells me that the new hire, whom he describes as a “well-known figure from established media,” has been locked up, is finishing paperwork, and will be on board within two weeks. Finke also promises to have hires in “London, Paris, Mumbai, Hong Kong, and Sydney” within the next year.

Not that long ago, it would have been inconceivable to see a big-name media macher go to work for a one-woman blog owned by a white-label email services provider. But now that Web publishing has lost most (but not all) of its reputation as a backwater for second-raters, wannabes and has-beens, and now that traditional publishing is on life support, it’s a whole lot more believable.

So. Who’s making the leap and jumping into the digital pool with the rest of us? (It’s great fun! You’ll love it! Unless you hate it!) A few of us have been guessing at names for a bit, but there’s no reason to keep our parlor game to ourselves.

Feel free to speculate in comments below, though you’ll have to use your real name if you do. If you’re feeling shy, you can reach me directly at peter@allthingsd.com. And if you want to be completely anonymous, which is understandable but less useful to me (I won’t have any way of reaching you for follow-up) you can use the blind tip box here.

John Borthwick, who funded bit.ly via his Betaworks investment group, explains the details of his offer here, along with a bit of pro forma condolence for the demise of his competitor: “Sad day yesterday to see tr.im announce that they are shutting their doors, after failing to make a business of a nice service with a great URL.”

To me, that sounds a bit like a mafia don shaking his head a tad wistfully after hearing that one his old rivals got bumped off, then sending a big bouquet to the funeral. And I think that the tr.im team, as well as some of bit.ly’s other competitors, may take it in the same vein.

UPDATE: I spoke to Eric Woodward, CEO of Tr.im’s parent company Nambu Networks. As I thought, he’s uninterested in working with Bit.ly, either directly or via 301works, the third party archive Borthwick has proposed. His response: “Why would I want to upload all my of data to Bit.ly?” When I suggested that this might be a good move for his users, he allowed that it still might happen — if he can’t find a buyer for Tr.im. And that’s a distinct possiblity: Woodward said he has been looking for a buyer for the past few months, without success.

But Borthwick’s proposal also sounds like a good one to me. I’ll let the wiser Webheads explain whether it’s a real solution for the problem that tr.im’s failure will create for the Web, namely, the notion that lots of Web addresses, shortened for use in social Web services like Facebook and Twitter, will stop working one day.

And if you do think it’s a real problem and not just an annoyance for the service’s users, as well as for Web sites that got referral traffic from the service, then someone’s going to need to think of something. We’re going to see more of this.

That’s because if there is any business at all in URL-shortening, it’s going to be a scale business that ends up in the hands of a couple competitors, max. Just like search. And that means that dozens of mom-and-pop competitors (here’s a visual snapshot, taken last fall, of 117 URL-shorteners) are going to fall by the wayside.

Right now Bit.ly looks to be the Google (GOOG) of URL-shortening, and there is some griping that it got that status unfairly, via a deal with Twitter that made it the service’s default shortener last May (type a long Web address into the message box on Twitter’s Web page, and the service will automatically convert it into a bit.ly link–like this). Not true, says Borthwick–the Twitter deal helped, but it’s not responsible for the majority of Bit.ly’s traffic.

But there’s no reason for Borthwick, Bit.ly or Twitter to be defensive about the deal. If Twitter wants to pick a preferred vendor/partner/developer for any or all of its services, it should do so. It’s not going to do that very often; one of the main reasons that Twitter has taken off is the ecosystem of developers who have built innovative stuff using the service’s open architecture, and it won’t want to discourage that.

And if Twitter wants to work with someone it’s already doing business with–prior to Twitter’s most recent funding round, Betaworks owned a sizable slug of Twitter’s stock, via Twitter’s acquisition of Betaworks portfolio company Summize a year ago–there’s no problem with that, either.

In any case, the Bit.ly/Betaworks guys have other things to worry about. They still need to figure out how to take the data stream they’re mining from all those tiny Web addresses they’re making and do something useful/valuable with it.

Then again, so does Twitter.

Now we know. BusinessWeek’s Jon Fine talks to people who have seen the black book for BusinessWeek, which McGraw-Hill (MHP) has indeed put on the block. The numbers are brutal. Fine:

The data state that BusinessWeek lost around $20 million on revenues of $147 million in 2008, and that slightly smaller losses are projected in 2009 on revenue of around $135 million. These losses do not, however, include key corporate overhead items, such as rent and certain infrastructure-related costs. When all those items are factored in, the total loss figure essentially doubles, said two executives who saw the data.

Not surprisingly, those numbers seem to have scared off every traditional publisher that might be a logical buyer. The list of nonacquirers includes Time Warner’s (TWX) Time Inc., News Corp. (NWS) (which owns this Web site), Bloomberg and Thomson-Reuters (TRI).

So who does want this thing? Fine suggests that Open Gate Capital, the private equity firm that bought TV Guide for $1 plus debt last year, may be up for a similar transaction. Another possibility: Billionaire Bruce Wasserstein, who’s already shown a penchant for high-profile properties, like New York magazine.

In a post from co-founder Biz Stone, the company counsels users that, with the exception of a single account, none of their personal information seems to have been exposed as a result of the hack. But before establishing that, Stone goes out of his way to explain that Twitter’s security problems are Twitter’s security problems, not cloud computing’s security problems or Google’s (GOOG) security problems.

This attack had nothing to do with any vulnerability in Google Apps which we continue to use. This is more about Twitter being in enough of a spotlight that folks who work here can become targets. In fact, around the same time, Evan’s wife’s personal email was hacked and from there, the hacker was able to gain access to some of Evan’s personal accounts such as Amazon and PayPal but not email. This isn’t about any flaw in web apps, it speaks to the importance of following good personal security guidelines such as choosing strong passwords.

That last line seems directed at the likes of analysts like yours truly, who suggested this morning that the hack would raise concerns about the security of services that place work data on shared servers accessed via the Web. (Though the Twitter guys did seem to like my underwear-drawer metaphor. Cool!)

Stone then goes on to rattle a sword, gently but pointedly, at Web sites that have published stuff pilfered by the hacker.

We are in touch with our legal counsel about what this theft means for Twitter, the hacker, and anyone who accepts and subsequently shares or publishes these stolen documents. We’re not sure yet exactly what the implications are for folks who choose to get involved at this point but when we learn more and are able to share more, we will.

Note that while it’s easy enough to find this stuff on the Web, only a handful of mainstream Web sites, including TechCrunch, Gawker and Silicon Alley Insider, have published it, and most of what they have published is banal. I’ve asked all three sites for a response to Twitter’s response.

In the meantime, TechCrunch’s Mike Arrington, who has promised to publish more, announces in a new post that he is in the midst of “negotiations” with Twitter’s lawyers about his plans. Happy to hear from a First Amendment specialist, but I don’t think Twitter has a case against Web publishers here; the issue is an ethical one, not a legal one.

UPDATE: Here’s Gawker Editor-in-Chief Gabriel Snyder’s “bring it on” retort:

It’s hilarious to see Twitter, which has become a conduit for real-time, unauthorized information from places like the New York Times’ internal meetings, now get prissy about corporate privacy. Ev Williams seems to have learned a lot about the mores of the institutional elite during his stay in Sun Valley. As for Twitter coming after us for publishing the docs, the only thing I’m upset about is that the leaker didn’t come to us with them first.

The site is the work of Peter Rojas, who helped build Gizmodo and Engadget, and Ryan Block, who took the torch from Rojas after he moved on. Gizmodo and Engadget are the best known and most powerful of the new generation of gadget sites, which makes Rojas and Block revered by the gadget gang. That’s why we’ve been hearing about gdgt, in dribs and drabs, for many many months.

But as well known as Rojas and Block are, they’re still going to have to work hard to make a dent in the crowded field. In addition to the two blogs they created, the gadget spectrum includes everyone from staid players like CBS’s (CBS) CNET to rumor sites for Apple (APPL) obsessives, like MacRumors, to sites for real obsessives, like the handful of people who still own Palm (PALM) Treos. (And, of course, there’s All Things Digital’s Walt Mossberg, who bestrides all of this like the colossus he is, and is also my boss. Hi, Walt!)

Rojas and Block argue that their site is different because it’s not going to be driven by editors but by the site’s users, who will gather there to swap info, stories, rumors, opinions, etc. In other words, Facebook for gadgets, though I gather they’d recoil if they heard that. The other pitch, though they won’t spell this out, either: Their site takes a bunch of features and content that you can find other places and presents them in a better way.

There’s a bunch of nifty features, like a gadget-finder that lets you find products via specs instead of brands, and the site seems to be pretty slick. But it’s better if you have a look yourself instead of having me describe it. And gdgt.com won’t really hit its stride until actual users start using it. I look forward to hearing what they have to say about my upcoming phone dilemma: iPhone 3GS, Palm Pre or Blackberry Tour?

But as much as Rojas and Block argue that this is a community site, it’s their names and reps that have people interested in the project. And that’s what has convinced investors to plow money into an ad-supported Web site in an era when the economy sucks and there are way too many ad-supported Web sites.

The duo won’t discuss funding, but I’m told that last fall they were discussing investments of up to $1 million, but ended up taking less than that via a group of VCs and angel investors. I don’t have a complete list of investors, but people familiar with the company tell me that early-stage investor True Ventures led the round, which also included New York-based incubator Betaworks and Mahalo’s Jason Calacanis.

Calacanis’s name will resonate with longtime followers of the tech blog world: He was one of the founders of Weblogs Inc., which created Engadget as a rival to Gawker Media’s Gizmodo, and hired Rojas away from Gizmodo. Calacanis eventually sold Weblogs Inc. to Time Warner’s (TWX) AOL for a decent pile of cash, some of which I believe ended up in Rojas’s lap.

Click the image below to see a screenshot of what gdgt’s homepage ought to look like.

The service is laying off the majority of its employees, and CEO Mike Volpi (pictured right) is out, replaced by Matt Zelesko, who had been SVP of engineering. The Joost.com portal site will stay open, but best to think of it as an ad for the company’s hosting and distribution services, which it will try to sell to cable companies and the like.

A Joost spokesperson declined to say how deep the layoffs will be; but I’m told that the company, which had more than 100 employees last fall, will be down to a couple dozen after the cuts are done. In a post on Joost’s Web site, Volpi said the company “will say goodbye to many of our colleagues and friends.”

This isn’t a shock: Joost’s fate has been the subject of whisper and rumors for the last year or more. The service made an initial splash in 2007 by raising $45 million from the founders of Skype and an array of high-profile investors and media companies, including Sequoia Capital and Viacom (VIA), and was initially supposed to deliver copyrighted content via a peer-to-peer distribution system and a player that users downloaded to their desktops.

But YouTube, and later Hulu, conditioned users to watch video via their browsers, and Joost’s software never caught on. By last fall, the company had retooled and began offering video via the browser like everyone else, but it has never been able to generate a significant audience. In November, a month after the company launched its Web browser, it said it was attracting 2.1 million unique users world-wide, a fraction of YouTube’s audience, and well behind rivals like Hulu, MetaCafe, Veoh and DailyMotion.

Here’s the service’s unique visitor count, per Comscore (SCOR); Joost’s unique viewer count, which is the more relevant metric for video sites, is considerably smaller (click to enlarge):

Joost has been a frequent candidate for buyout rumors, and the company hasn’t gone out of its way to deny them. The supposed buyers would be cable companies like Comcast (CMCSA) Time Warner Cable (TWC) or telcos like AT&T (T) and Verizon (VZ), which would presumably use Joost’s technical team to help build out their own Web video plays.

But some of the cable guys and telcos insist that they’re fine with the people they have. And if they do want to buy a video player, they have plenty of options: Just about all of Joost’s peers have been on the block, formally or informally, for the past few months.

JOOST TO PROVIDE WHITE LABEL ONLINE VIDEO PLATFORM

NEW YORK AND LONDON – June 30, 2009 – Joost, the online video startup, announced today that, along with Joost.com, it will focus on providing white label online video platforms for media companies, including cable and satellite providers, broadcasters and video aggregators. This technology and service offering will support content owners’ efforts to build comprehensive branded environments online.

Media companies around the world are embracing internet-based video portals as a key path to distribute their premium video, but building a world-class video portal is increasingly difficult and expensive. Joost will focus on this issue and provide the market with a cost-effective, end-to-end solution for media companies to publish video under their own brands.

As a part of this new direction, Joost will reorganize and restructure its business. A core team in New York and London will work on providing these solutions, as well as operating and supporting Joost.com and its associated video applications. Joost also will wind down operations in its Leiden development center.

Matt Zelesko, currently SVP of Engineering at Joost, will take over as CEO while continuing to lead the engineering organization. Stacey Seltzer, currently SVP of international business development and content acquisition at Joost, will run the business operations. Mike Volpi has stepped down as CEO of Joost but will remain actively involved as Chairman of the Board.

Joost plans to make its white label video platform commercially available to media companies around the world. This offering will provide a solution for companies looking to build a branded experience for their content on their own site as well as other sites and platforms in their distribution networks.