In a move to bring profitability to its popular video sharing site YouTube, Google Inc. (NASDAQ: GOOG) has inked a deal with Time Warner, Inc. (NYSE: TWX) to show clips of the company's television shows and movies.

When Google announced back in 2006 that it would be paying $1.65 billion for the popular video sharing site, a lot of critics questioned whether or not the company would be able to turn a profit from the site, which at the time had around 46% of the online video market share.

When embattled Time Warner (NYSE: TWX) CEO Jeff Bewkes gets on the company's fourth quarter earnings call next week, February 4, he will certainly be asked one thing. With the advertising market facing one of its worst periods in years, how does he intend to keep profit margins high? Several of the company's businesses, particularly magazine group Time, Inc., AOL (parent company of BloggingStocks), and the firm's cable networks, rely on advertising for a large portion of their revenue.

Late last year, Time, Inc. cut 600 jobs. AOL just said it would let another 700 people go. No plans have been announced for cable operations like CNN, but those may come.

It seems that at some point soon newspapers will not even need writers. They will simply keep presses and trucks to print and deliver their products. It is a hell of a way for a once-proud business to survive.

According to The Wall Street Journal, "Two major newspapers publishers are taking steps to outsource international coverage, as falling revenue is causing more U.S. papers to shrink their foreign and national footprint." The Tribune Company, now in bankruptcy, and The New York Daily News, which is not part of any chain, may end up closing any offices they have outside the US.

Many US newspapers get most of their national news from agencies like the AP. What does that leave?

It leaves a great deal actually, and what it leaves is the key to the survival of newspaper--local coverage. Consumers can get international and national news from hundreds of websites from CNN to USA Today.com. But, what they cannot get is what is going on in the paper's hometown. And, that is often the most important news that readers look for. Other than the local newspaper there is no source to provide it.

Local newspapers may survive by being "all local" along with their websites. This is what the American newspaper was a century-and-a-half ago. Few papers had any access to news from outside their small regions. People turned to their newspapers as a way to find out about the smaller, more intimate world around them.

The future of the newspaper industry may take it back to 1855.

Douglas A. McIntyre is an editor at 24/7 Wall St.

Time Warner Inc. (NYSE: TWX), which has been reeling from declining advertising sales, said today that its results would be worse-than-expected this year.

In a statement released ahead of a presentation to analysts, the world's largest media conglomerate said it had a net loss in 2008 compared with its guidance issued in November that called for earnings of $1.04 to $1.07. Several one-time items contributed to the loss, including the write-down of a lease in the Time-Life building from a tenant that filed for bankruptcy. The write-offs total $25 billion.

"In addition to these items, the economic environment has proved somewhat more challenging than the Company previously expected, particularly for the advertising businesses at the AOL and Publishing segments, further reducing the expected growth rate in 2008 Adjusted Operating Income before Depreciation and Amortization by about one percentage point," the company said in press release.

None of this is surprising given the anemic environment for advertising. The company's magazine business is particularly vulnerable and has already experienced layoffs. Investors are still eager for Time Warner to dispose of AOL, though a deal for the parent of this blog is not likely until the economy improves. Another business that may see further cutbacks is book publishing.

Regardless, this news gave Wall Street a reason to avoid the New York-based company. Shares have rebounded a bit after trading down 10%.

Democratic presidential candidate Barack Obama is about to enter the "No Spin Zone."

The Illinois senator is due to be interviewed by Fox News' Bill O'Reilly, host of the "The O'Reilly Factor," on Thursday, the final night of The Republican National Convention, according to TVNewser.com. I am sure executives at Fox parent company News Corp. (NYSE: NWS) were high-fiving each other when that interview was secured. The clash between the suave Obama and the bellicose O'Reilly will make for interesting television. It will be like a car accident on the highway that people can't help themselves from gawking at.

Maybe Obama views it as a chance to show his supporters that he is not afraid of O'Reilly, who is a pussy cat compared with Russian strongman Vladimir Putin. It's also quite a contrast to the strategy of Republican John McCain, who is keeping the media at an arm's length. His campaign even canceled an interview the candidate had scheduled with CNN's Larry King because it did not like the tough questions anchor Campbell Brown asked its spokesman about the qualifiicaitons of his running-mate Sarah Palin.

Both the Democratic and Republican conventions have been a dream come true for the cable news channels. More people tuned into CNN, which is owned by Time Warner Inc. (NYSE: TWX), for Obama's acceptance than for Fox, MSNBC and the broadcast networks. The address got more viewers than the American Idol final, the Oscars, or the opening ceremony of the Beijing Olympics.

Fox, though, continues to attract more viewers overall, especially during the Republican get-together in St. Paul. General Electric Co.'s (NYSE: GE) MSNBC is gaining viewers too, though some may be curious to see if its feuding on-air personalities will break into a fist fight. All three of the cable news networks are raking in major bucks from those annoying 30-second TV spots that are an unfortunate part of American political life.

A winner has already emerged from the Obama-O'Reilly confrontation before a single punch has been thrown: News Corp. head Rupert Murdoch. The media baron lusts for the power to set the nation's political agenda. Come Thursday night, that's exactly what he will be able to do.

Depending on who is doing the measuring, The Weather Channel is one of the most widely watched 24-hour cable networks. Weather.com is among the top 15 or 20 most visited websites in the U.S. Since there are very few media properties of this size on the block, they are especially valuable.

Landmark, the owner of The Weather Channel, has put it on the block. It wanted $5 billion. The rumors are that it will get $3.5 billion on a good day. The last two companies kicking the tires were Time Warner (NYSE: TWX) and NBC Universal. TWX has apparently dropped out.

Although the media conglomerate has over $9 billion in money coming in as it finishes its spin-off of Time Warner Cable (NYSE: TWC), management cannot afford to be viewed as overanxious. Paying too much for a large asset would not make the new era of shareholder value under recently appointed CEO Jeff Bewkes look like it is off to a terribly good start.

According to The Wall Street Journal (subscription required), "Time Warner withdrew after Landmark told the media company it needed more time to make a decision." That probably means the seller is holding out for more cash.

For Time Warner, it is a shame. Its cable networks, CNN and Turner, do particularly well. Putting The Weather Channel with them would have built that business. Online, TWX has big properties like AOL and CNN.com, making Weather.com a good marriage.

It all made sense, except the price.

Douglas A. McIntyre is an editor at 247wallst.com.

This post is part of our Battle of the Brands feature. Let us know which brand you prefer, and check out other Battle of the Brands posts.

The heads of CNN, Fox News, and MSNBC along with their corporate masters at Time Warner Inc. (NYSE: TWX), News Corp. (NYSE: NWS) and General Electric Co. (NYSE: GE) must be giggling with delight at the prospect of the Democratic presidential race continuing past the hotly contested race in Pennsylvania.

After all, controversy means more viewers, which of course means more advertising dollars. They probably wish that the Democrats would beat each other up in 30-second TV spots every year, but alas Americans elect a president every four years, which is probably a good thing for everybody. Still, the cable networks are going to ride this gravy train for as long as they can.

Like anything else in cable news, picking a winner in this battle of the brands depends on how you look at it. Fox, the home of Bill O'Reilly and Shepherd Smith, attracted 1.89 million viewers during Monday's prime time, the most of any network, according to Nielsen data cited by TVNewser. CNN attracted 1.03 million on its main network and 572,000 on its Headline News channel, while MSNBC was watched by 676,000.

Before conservatives start declaring Fox the top cable network yet again, remember that statistic does not represent the whole picture. Cable news advertisers are most interested in viewers aged 25 to 54 who are most likely to be interested in buying mutual funds and other products that they are shilling. That's where things get interesting.

It is a lawsuit which will never be won, but it does show how upset the Chinese are about being attacked for problems with their exports. Drug components for products like blood thinner Heparin are blamed for over 80 deaths in the US. Some of these components came from China. There have also been health issues with lead-paint-based toys which have been exported to US companies The paint is dangerous for children.

A group of citizens in China is sick of the US bully kicking sand in its faces. They have filed a $1.3 billion lawsuit against CNN, a unit of Time Warner (NYSE: TWX). The legal action represents $1 for each person in the world's most populated country. The current suit was launched by a Chinese primary school teacher and a beautician. There is also a suit by 14 mainland lawyers pending.

According to Reuters, "The case (is) against the Atlanta-based cable channel, its parent company Turner Broadcasting and Jack Cafferty, the offending commentator." Cafferty said "They're basically the same bunch of goons and thugs they've been for the last 50 years" when referring to the Chinese who had sent lead-painted toys to the US.

Is the story a worthwhile one for the press to cover? Probably not. It really belongs in the entertainment sections of news programs and newspapers.

But the media will put it on the front page everywhere because no one can make up a story like this one.

Douglas A. McIntyre is an editor at 247wallst.com.

CBS (NYSE: CBS) closed at $22.51 Monday.

The New York Times reported CBS has been in discussions with TWX about a deal to outsource some of its news-gathering operations to CNN.

CBS overall option implied volatility of 33 is near its 26-week average according to Track Data, suggesting non-directional fluctuations.

Option Update is provided by Stock Specialist Paul Foster of theflyonthewall.com

Super Tuesday had a super payoff for CNN.

The Time Warner Inc. (NYSE: TWX) cable channel attracted 3.6 million viewers, beating out Fox News Channel which had 3.5 million and MSNBC -- which I prefer -- which had 2.1 million viewers between 8 and 11 p.m., according to The Los Angeles Times. Before you NPR listeners raise your Starbucks cafe au laits in triumph, remember that one night does not make a trend. Fox still rules the ratings roost overall.

This does underscore a few trends. One is that Fox is no longer the only voice of conservative thought on cable TV with the likes of Lou Dobbs on CNN and Pat Buchanan on MSNBC. Also, the far right brand of conservatism espoused by Fox may be out of favor. The presumptive Republican nominee John McCain is hardly a favorite of the far right even though he's trying really hard to mend fences ahead of the general election.

News Corp., though, is not hurting. During the second-quarter, operating income from its cable channels rose 34% to $1.24 billion as higher revenue from Fox News Channel and the other networks more than off set the startup costs at Fox Business Network and the Big Ten Network.

When Rupert Murdoch's News Corp. (NYSE: NWS) first announced plans to start a cable channel to compete against CNBC, I was psyched. At least, I thought, there would be an alternative to the General Electric Co. (NYSE: GE) channel's must yell TV format. Boy was I wrong.

In its brief existence, Fox Business Network has largely distinguished itself for being undistinguished, making some unbelievably stupid mistakes such as confusing Apple Inc. (NASDAQ: AAPL) with Abu Dhabi. More recently, the anchors of the show "Fox Business Happy Hour", Cody Willard and Tracy Byrnes, appeared a little too happy during a segment on of all things drunk driving. Call it an occupational hazard of hosting a show at a bar. Missing in all of this merriment was one crucial thing: breaking news.

(Note: I crossed paths with Willard and Byrnes at TheStreet.com though I never worked directly with either of them.)

Time Warner Inc.'s (NYSE: TWX) new Chief Executive Jeffrey Bewkes will have plenty to talk about when the world's largest media conglomerate -- and parent of BloggingStocks -- reports fourth quarter results tomorrow.

The results themselves aren't going to be anything spectacular. Analysts expect earnings of 29 cents on revenue of $12.64 billion, according to Thomson Financial. As usual, the focus will be on AOL, in particular how much gains in advertising offset the declines in the dial-up business. Also, the company will need to detail its plans for the cable business which may be hurt by an economic slowdown. The future of the publishing business also remains in doubt as advertisers continue to flee print for online media.

Microsoft Corp.'s (NASDAQ: MSFT) $44.6 billion bid for Yahoo Inc. (NASDAQ: YHOO) only adds to the confusion. Will investors give Bewkes enough time to transform AOL's business to an ad-supported model? The strategy is the correct one though it was initiated about two years too late. But given the premium that Microsoft is offering for Yahoo, investors are bound to pressure Bewkes to make a similar deal for AOL, which today bought the online marketing company buy.at.

The Weather Channel, held by family-owned Landmark Communications of Virginia, is being auctioned off along with the rest of Landmark, and could fetch $5 billion. A number of public companies may have an interest. According to The New York Times, firms looking at the property include Comcast (NASDAQ: CMCSA) and General Electric (NYSE: GE).

The Weather Channel is attractive for two reasons. The first is that there are very few large, independent cable networks. Most, including CNN, CNBC, ESPN, and MTV, are already owned by media giants. The chance to pick up another large advertising-supported 24-hour product should be very attractive.

The second tremendous selling point is that weather.com, the online arm of the company, is one of the most-visited sites in the U.S. In November, comScore ranked it as the 16th most-visited website, with 34.1 million unique visitors. That puts it ahead of ESPN.com, CBS.com, and the Viacom (NYSE: VIA) digital properties.

The Weather Channel is a rare prize. The bidding should be spirited.

Douglas A. McIntyre is an editor at 247wallst.com.

Sources close to CNN broadcast journalist/commentator Lou Dobbs said he is seriously considering a run for the U.S. presidency in 2008, The Wall Street Journal reported.

Dobbs, who formerly hosted CNN's MoneyLine business news show and currently hosts CNN's Lou Dobbs Tonight has seen both his ratings and his name recognition rise after his work's focus turned away from news reporting and anchoring and toward political and economic commentary.

Dobbs, an independent, displays an ideology and a political world view that many have characterized as a modified hybrid of Ralph Nader and Pat Buchanan -- i.e. populism combined with strong views against free trade (or current trade frameworks) and against illegal immigration.

Dobbs is a frequent critic of both the Democratic and Republican parties, which he argues don't represent the interests of the typical person or the middle class. His show's website describes him as "an independent populist and the leading media advocate for working men and women, their families, our middle class and the American way of life."

Political Analysis: Unless there's a tidal wave of discontent in the American electorate not tallied by pollsters, Dobbs, as a third-party candidate or as an Independent, has virtually no chance of being elected president of the United States. Although his name recognition is rising and he has a positive public image, it's highly unlikely Dobbs could assemble the campaign staff and money required to compete effectively against Democratic and Republican parties' nominees.

However, this is not to say that Dobbs could not broaden the discourse, i.e. "force the discussion of less-publicized issues" during a debate. Dobbs could accomplish this, but it must be emphasized that making points in a debate is a much easier task than receiving enough votes to win the electoral college vote for U.S. president.

CNN Worldwide, a part of the Time Warner Inc. (NYSE:TWX) franchise, is expanding its staff of correspondents by 10% as it looks to increase its original content. The investment is said to be under $10 million and will add about 16 correspondents to its staff of 150.

About two months ago, CNN announced it was abandoning the relationship with Reuters Group PLC (NASDAQ:RTRSY) and would instead bolster its own news capabilities. The idea is to capture more advertising by owning the content as the content can simultaneously be pushed out over multiple distribution platforms.

What is interesting here, is that the focus is in the United Arab Emirates, where CNN operates CNN.com Arabic. It will use some of the investment for a digital production unit in London, as well as to increase its staff in Hong Kong. Mexico City and Johannesburg. Additional staff, and news operations are being planned in Belgium, Poland, India, Afghanistan, Nigeria, Kenya, Malaysia, the Philippines, and Vietnam.

Over the past several months Wall Street experts have been debating whether or not America is headed to a recession, and according to a new CNN poll, a large percentage of Americans think that the country has already entered a recession.

Concerns over a possible recession have been lingering for most of the year, as housing prices have steadily fallen, while prices for gas and food continue to rise. But the sentiment really started to take hold this summer as the subprime mortgage meltdown started to spread. These concerns are only going to grow today after a weak Bank of America Corp (NYSE: BAC) earnings release.

As the weak housing market continues to deteriorate CNN finds that nearly half of all Americans are now under the impression the country is already in a recession. According to its recent poll, 46 percent of U.S. residents believe the country is in a recession, with 51 percent thinking we have not.

The report also showed that black Americans are taking a much more pessimistic stance on the current economy. CNN shows that 69% of all black Americans feel the country is in recession, while only 42% of white Americans think this is the case.