Steven Brill, self-anointed media critic and the founder of American Lawyer magazine, has always seemed to be more journalist than businessman. That became all too clear on Oct. 15, when Brill, 51, announced that he was folding media watchdog magazine Brill's Content and selling his remaining stake in the Inside.com media site to co-owner Primedia (PRM). Neither had ever turned a profit.
The move also marked the end of Brill's controversial partnership with Primedia. Earlier this year, Primedia had taken a 49% stake in Brill's company, as the two tried to meld their media properties. But a clear business strategy for combining those assets was never articulated, and relations between Brill and Primedia CEO Thomas Rogers had become strained.
Brill had made a name for himself in the 1980s with the highly successful launch of American Lawyer. Then in 1991, he went on to found Court TV. But reinventing himself as a media scrutinizer proved too much. So for now, Brill will have to content himself teaching journalism classes at his alma mater, Yale University. The good times are looking even farther away for Enron (ENE). The company's inability to extend its energy-trading model to some other commodities is proving increasingly costly. On Oct. 16, the nation's top natural-gas trader and leading wholesale electricity marketer reported a $1.01 billion charge. Among other things, that covers recent forays into broadband and water trading--as well as the unraveling of a pair of limited partnerships. Those partnerships had raised questions about conflicts of interest. Until recently, they had been overseen by the company's CFO, Andrew Fastow, even though they were outside entities that bought assets from Enron. The aftertax charge was one reason the company posted a $618 million loss in the third quarter, vs. a profit of $292 million in the year-ago period. Without the charge, Enron would have shown a profit of $393 million for the quarter. A week after the September 11 terrorist attacks, United Airlines (UAL) slashed its flight schedule to reflect the falloff in demand for travel. Turns out this wasn't enough. So on Oct. 15, the UAL subsidiary said that, starting Oct. 31, it would cut flights to 1,654 a day, nearly one-third below early September levels. Will that stem its slide? UAL is already expected to lose $1.8 billion this year. And in a letter to employees, Chairman James Goodwin warned: "United will perish sometime next year," if the hemorrhaging doesn't stop. On Oct. 16, America's largest brokerage, Merrill Lynch (MER), said it may lay off 10,000 of its 68,200 employees. The move is part of a broader shakeup being carried out by new President Stanley O'Neal--under pressure from the board, say analysts, to improve the firm's performance. "[O'Neal] is going to achieve the restructuring and the cost improvement that the board wants," says Guy Moszkowski, a securities industry analyst at Salomon Smith Barney. O'Neal may have little choice. Many on Wall Street believe the firm could ultimately be forced to sell out otherwise. But a successful restructuring will diminish that likelihood. Six states announced a plan on Oct. 17 to buy drugs collectively in an effort to curb escalating prescription drug costs. Working together, the states of Maryland, Mississippi, Missouri, North Carolina, South Carolina, and Washington will use their combined buying clout to win volume rebates from pharmaceutical companies. For now, they represent some 1.2 million current state workers and retirees. That number could grow if other states--or even private employers--join the group. And at the same time, eight Northeastern states are now discussing forming a similar pool. After 97 years in business, once-mighty Bethlehem Steel (BS) declared Chapter 11 bankruptcy on Oct. 15. The company was done in by cheap imports, anemic demand, and a $3 billion tab for health-care liabilities it owes retirees and their families. Bankruptcy may enable the nation's No. 3 steelmaker to limp along until it can find a buyer for its state-of-the-art mills. Suitors, though, are likely to be scarce, considering that Bethlehem's filing could push even more steel companies into insolvency. Industry observers say the company will almost certainly cut prices to maintain cash flow. Next up, warn analysts, could be Weirton Steel (WRTL) or Birmingham Steel (BIR), because of their heavy debt loads. -- AT&T (T) and British Telecommunications (BTY) will end their Concert joint-venture.
-- S&P (MHP
cut GM's (GM) and Ford's (F) long-term credit rating by two notches, to BBB+.
-- Bristol-Myers Squibb (BMY) won an appeal to keep generic drugmakers from making its BuSpar anti-anxiety drug. Gamers aren't the only ones happy with graphics chipmaker Nvidia (NVDA). The Santa Clara (Calif.) company's stock has nearly doubled since Oct. 1, to $41.70 on Oct. 17. Investors bet earnings will get a boost from new chips for desktops and software for notebook PCs, as well as a deal to supply key components for Microsoft's (MSFT) upcoming Xbox game console.