The mayhem in the media industry continues. The Wall Street Journal, a News Corp (NASDAQ: NWS) property, is closing its Boston bureau and sending nine employees into the wind. The newswire and MarketWatch operations are going to stay open in Boston, however, with no headcount impact.

The Journal doesn't have any plans to close other offices, according to a memo by managing editor Robert Thomson: "there are no plans, nascent or otherwise, to close any other U.S. or international bureau." The WSJ will still support an "investigative function" in Boston, but the New York-based Money and Investing team will cover Boston's mutual fund industry, which boasts such heavy hitters as Fidelity.

At the same time, magazine company Time Inc., owned by Time Warner (NYSE: TWX) is looking to cut $100 million in expenses, and layoffs will undoubtedly figure into the equation. The company that owns Time, Fortune, People and Sports Illustrated – and falls under the same umbrella as AOL, which owns BloggingStocks – is feeling the squeeze of a media recession that's even worse than the regular recession we've all been battling for what feels like decades.

Playboy Enterprises (NYSE: PLA) is still around? I was surprised to hear that it was, according to a news article from Reuters detailing the struggling media company's second-quarter results. Unfortunately, Playboy remains a puzzle. How in the world is management going to turn the ship around?

Playboy's top line fell by 15%. The bottom line booked a loss of 26 cents per share. Expectations were for 23 cents per share to be lost. In the year-ago period, Playboy lost 10 cents per share. I think it's plainly obvious that Playboy just isn't the force it once was. Pretty sad to see this icon slowly fade into irrelevance as the digital revolution continues to devalue its historic brand equity.

Ad pages have been falling throughout the magazine publishing industry, and titles have been shut down at a breakneck pace this year, with newspapers not far behind. Some titles seem immune to the problem; or, at the very least, the lesser of many evilly-immense decreases. Scientific American, as a unit of book publishing juggernaut Macmillan, was one of those at only an 18.1% ad page decline in 2009's first quarter. And the title, 164 years old, has weathered many storms in the industry; it's as solid as an oak.

Yesterday, news of a reorganization had industry onlookers worried that a few employees would be let go. By the end of the day, media watchers were shocked as Editor-in-Chief John Rennie, who's held that role for 15 years, and at least 20 other employees were laid off.

Sports Illustrated's swimsuit edition has long been a magnet for controversy, mainly from parents who do not like the contents. To each his own, but I find it interesting that this year's installment may not find its way to Wal-Mart (NYSE: WMT) shelves, for a totally different reason.

WMT's problem with the magazine is really a problem with the wholesaler's demand for a seven-cent surcharge on delivery of each copy of the magazine. However, this New York Post article notes that the problem goes far beyond WMT and the swimsuit edition.

The article says that the problem boils down to two wholesalers: Source Interlink and Anderson News. The duo enacted the surcharge three weeks ago in hopes of "shoring up" a money-losing business. However, it certainly appears that this strategy may have backfired, as Time Inc., Bauer Publications, and American Media (three publishing giants) all refused the surcharge.

In a previous post about the medium I call "periodicals printed on paper," I wrote that the universe of magazines and newspapers was being winnowed, and only the very best would survive. As my mind's eye darted around a mental image of a newsstand, a few periodicals stood out as "best"; Martha Stewart Living chief among them. MSL has not just created a loyal following and niche audience; it is a symbol of an entire subset of the population, an aspirational icon who is, while not exactly an ordinary person herself, creates a mostly achievable lifestyle. Her magazine will always represent the soul of the DIY culture; not for nothing do people say of any well-executed craft, especially one involving vintage pieces found at a thrift store, "that's so Martha!"

The rumor mill announced yesterday that Playboy Enterprises (NYSE: PLA) is going to suck it up, pull out, and move its entire operation to its home port of Chicago. According to a blurb in The New York Post, "Playboy is combining its Web site and magazine staff into one editorial organization." Evidently, the company is feeling the squeeze from 1.5 million free internet porn sites, give or take several million.

In the matter of nudity as entertainment, has the adage "sex sells" been supplanted by the new phase of "sex is free for the taking?" In the world of high gloss paper media, such would seem to be the case. So, what is a gnarly old, skin peddling millionaire to do? Whatever shall become of our most familiar white bunny head?

Hugh Hefner is still smiling, and it seems obvious that he still has some faith in his production staff. However, getting a continuing rise out of the public, and getting them to continue opening their wallets, is quite another matter. The company is doing fairly well in it's non-media operations, but in the world of cheesecake, it looks pretty much all down hill.

I'm guessing that in the halls of Playboy there have been some extremely hot and sweaty brain storming sessions going on. There is one thing in this situation that I'm almost absolutely certain of: If the gang at Playboy Enterprises can't continue to do something to stimulate some growth, we're sure to see some serious bunny fur fly.

Gannett (NASDAQ: GCI) said it would cut almost 10% of its staff. This is hardly a surprise. Newspaper ad revenue has been running down over 15% this year and that trend is expected to continue. At some papers, classified ads -- mostly real estate, employment, and autos -- are off well above 30%. The internet has eroded readership. Most of these people will not ever return as newspaper subscribers. Gannett and all its peers trade at multi-year lows.

The advertising sales problem is beginning to spread to magazines. Between the internet and the recession, the magazine business is getting pinched and pinched hard. Ad pages at many business magazines and newsweeklies are down 15% to 20% this year. In some cases, the drop is closer to 30%. As a reaction, the largest magazine publisher in the U.S., Time, Inc., a unit of Time Warner (NYSE: TWX) will cut as many as 600 people. According to The New York Times, "No magazines are scheduled to close, but some are likely to be severely cut back."

Magazines will have to do something that newspapers have not be able to. They need to move their content to the internet in a way that will pull large numbers of readers so that advertising volumes are big enough to make up for the erosion of print dollars. Since there are a huge number of content sites on the web, there is plenty of competition.

The print magazine business is dying and dying faster than many analysts thought it would. Its only life boat is the internet. A life boat only holds so many people.

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

If anything could be blamed for the just-announced shuttering of Blueprint magazine, it could be the current issue's cover, in which a pink (!!) tree is out-sparkled only by the sequined frothiness of the bleached blonde holding a gigantic bauble alongside. Inside we see 20-something editor-in-chief Sarah Humphreys, who writes, "... if Blueprint's taught me anything, it's that there's plenty of room for spiced sugar bomboloni at the Thanksgiving table."

Umm. OK, Sarah. Martha Stewart Living Omnimedia (NYSE: MSO) strayed a little too far from the company's audience of blue-bloods and those who aspire to craft like them with Blueprint, a magazine unfortunately titled (evoking architecture of the blue-collar sort, not "where to find candles made of pink glitter"). It was meant to target the young single urbanite; but what newly-married aspirational New Englander wants a magazine full of recycled Martha Stewart Living projects, mixed with lipstick and gilded fashion advice? Evidently, not many.



The "brand" will be re-envisioned as a way to extend the audience of Martha Stewart Weddings past her nuptials, with occasional "special interest format" magazines (think Martha Stewart Baby), and the Bluelines blog will continue. The January/February 2008 magazine (probably already on the way to newsstands) will be the final standalone issue.

Conde Nast's magazine empire is storied, full of names that lead their respective empires. Vogue is not only the leading women's fashion title in the world, but also the inspiration for many a book, movie, and TV show. Gourmet is the formidable leader in food magazines; Travel + Leisure is the first/only name in travel; and The New Yorker is a category in and of itself (far exceeding the geographical borders set by its name). House & Garden is what many consider the premier "shelter" magazine, a title that defined the category for a half-century before the category was even named.

But today, Conde Nast announced in a brief missive that the magazine, along with its companion web site, would both be shuttered after the December 2007 issue, a sudden and final blow to a title whose audience, perhaps, had aged out of the market for aspirational goods like Wolf ranges and Vespas (the magazine's readership of nearly six million has a median age of 51, and average income of $124,582). Could the magazine's advertisers have been affected by the sub-prime meltdown? Without a home equity line of credit, you can't afford $1,700 tubular fireplaces, I expect, or anything to be found in Gwyneth Paltrow's abode.

The website still brightly reports that, if you subscribe today, you're guaranteed the Gwyneth Paltrow issue -- her Hamptons home is profiled, along with the Harlem penthouse of Starbucks Corp. (NASDAQ: SBUX) darling Marcus Samuelsson. The sense of doom hasn't yet struck Gwyneth's happy purpleness.

Also from Luxist: Are shelter magazines in trouble?

Bertelsmann AG, via its DirectGroup, is buying the other 50% stake of Time Warner's (NYSE: TWX) Bookspan. Bookspan owns roughly 40 book clubs, including the "Book of the Month Club." Financial terms were not disclosed.

Time Warner and Bertelsmann formed the partnership in 2000. This also includes the Doubleday Book Club and Literary Guild. Bertelsmann will reel in Bookspan into its BMG Columbia House.

BMG will now be the clear leader, with no real competitors in book, music and DVD mail order clubs in North America. This is all part of Time Warner's strategic changes after it closed Life and sold off 18 magazines earlier. It appears that even if an industry is shrinking, there at least may be some perceived value in being a virtual sole-supplier.

Jon Ogg is a partner in 24/7 Wall St., LLC; he does not own securities in the companies he covers.

MAJOR PAPERS:

• The Financial Times (subscription required) wrote that Citigroup Inc (NYSE: C) has shaken up its top management structure, giving senior status to executives outside New York in a move to recognize the bank's growth prospects abroad.
• Barron's Online's (subscription required) "Weekday Trader" was positive on Teva Pharmaceutical Industries ADS (NASDAQ: TEVA), writing that despite challenges in 2007, the company could win back its crown.

OTHER PAPERS:

• The Globe and Mail reported that DaimlerChrysler AG's (NYSE: DCX) Chrysler Group will eliminate 20%, or 2,000, of its 10,000 jobs in Canada.
• According to French paper Les Echoes (in French), Alcatel-Lucent ADS (NYSE: ALU) is expected to announce 12,000-13,000 job cuts, or more than 15% of its work force.
• Technology website CNet.com reported that Microsoft Corporation (NASDAQ: MSFT) will release Windows 6, the latest software for powering mobile phones, on Monday.
• Investor's Business Daily's "New America" column was positive on bed manufacturer Tempur-Pedic International Inc (NYSE: TPX), which makes visco-elastic foam mattresses. The company has been able to stay in front by doubling its R&D and increasing its ad spending.

If you read any of the many business magazines that I read (which is most of them), you will find that they give some very good advice regarding the benefits of investing in Index Funds over the long haul. However, once a year they publish things like the "Top 1,000 Funds" and variations on this theme. To me this contradicts their year-round advice just to generate an extra issue that serves no purpose except to confuse investors. I think 90% of the 1,000 funds are garbage and exist only to generate revenue for the investment company. They cater to a public fascinated by quantity of choice and various meaningless nuances and not by good sense.

Most of the data I have seen supports the premise that index investing (notably the S&P 500) beats stock picking (higher Internal Rate of Return (IRR)) over any 20 year period you choose. Plus, it has the added benefit of less market volatility. This makes it the optimal choice for most people. This is even more true when you consider taxes and fees.

Furthermore, if it were not true then investment guru and fund manager Bill Miller of Legg Mason would not be such a celebrity for beating the Standard & Poor's index for 14 years running. Have you read about any others? NO! There are many advisor's who may beat the index funds for a period of time, but not a long period, and it is usually not the same ones.

Business publications, such as Time Warner's Money and Fortune, should have a disclaimer accompanying their fund reviews. Or, giving them the benefit of the doubt, perhaps I should view these mag-rags as the publisher's way of giving us an opportunity to see for ourselves that none of these funds provide much added value -- unless you own the fund company.