The London Review of Books has always had close ties to America. The publication — the largest literary magazine in the UK — started as an insert in the New York Review of Books in 1979. But a year later, it went solo, and now over half its readership is in the US. So, when it came time to celebrate its 30th anniversary, the magazine decided to stage some of the party in the US.

As detailed on the LRB’s site, events will include: an April 19th lecture by Tariq Ali on “Obama’s War” at the School of Visual Arts; a lecture by Jacqueline Rose, co-founder of Independent Jewish Voices, on April 21 called “J’accuse: Dreyfus in Our Time”;  and, at New York University’s Tishman Auditorium on April 24th, a discusion of “The Author in the Age of the Internet” featuring authors Colm Tóibín, James Wood, Andrew O’Hagan, and John Lanchester, hosted by LRB editor Mary-Kay Wilmers.

Tickets for all events are $15 but, because the LRB wants the house stuffed with the kind of people who read MobyLives, they’re offering the first ten people to contact them a pair of tickets each. Write to drose@lrb.co.uk and tell them MobyLives sent you.

Is the forthcoming bio of Oprah Winfrey written by Kitty Kelly getting blackballed because people are afraid to offend Winfrey? That’s what a Wowowow report by Margot Howard says.

According to Howard,

… most of the kingpin interviewers in the mainstream media were astonishingly up front about saying they would not help Kitty promote her book because they didn’t want to offend Oprah! They didn’t even make up excuses; they flat-out said they didn’t want to offend Oprah. It was surprising, to say the least, that interviewers such as Larry King, Charlie Rose, David Letterman and Barbara Walters all shut her out. … Walters told Random House publicity she didn’t want to “upset” Oprah. Letterman said he didn’t want to “disrupt” his détente with Oprah. And ABC, whose name might as well now stand for “All ‘Bout Cowards,” made an across-the-board decision that Kelley’s book would be boycotted by all ABC shows. Even second-tier people like Joy Behar followed suit. And Rachael Ray! A cooking show, no less.

Of course, as Howard also notes, “there was great surprise in the publishing world that such a book could even be done. Oprah, being the doyenne of making or breaking books, was thought to be immune from an unauthorized biography because … well, she is the doyenne of making or breaking books.”

Meanwhile, despite the lack of publicity, an Examiner report notes that, on Amazon, the book “has already sailed to #25 as of this writing, and promoted customer discussions well before its April 13, 2010, release date.”

According to an internal memo obtained by Talking Biz News, New York Times publishing reporter Motoko Rich is off the book beat. The memo, by business editor Larry Ingrassia, notes that Rich is “soon” to become a reporter for the paper’s  Business Day section. MobyLives has often mocked Rich in a series called “Hello, Motoko!” (See, for example: this, this, this, this, this, this, and this.) Rich, it seemed to us, most often got publishing stories wrong, late, or worse.

According to a PW report, “The Times routinely changes its publishing reporter, but no replacement has been named yet.”

It’s the birthday of one America’s greatest investigative journalists, Seymour Hersh, born on this day in 1937. He became famous for breaking some of the major stories of our times, including the Abu Ghraib story for for The New Yorker, and numerous shockers about Watergate for the New York Times. That on top of award-winning books such as The Price of Power: Kissinger in the Nixon White House.

But the story that made him famous was a story none of the major publications would pick up and he wound up selling as a free-lancer thorugh the wires — his uncovering of the American army massacre of hundreds of innocent civilians in the Vietnamese hamlet of My Lai. He turned those reports into two stunning books, My Lai 4: A Report on the Massacre and Its Aftermath, and Cover-up: The Army’s Secret Investigation of the Massacre at My Lai 4.

Below, an excerpt from a speech Hersh gave at Northwestern University, in which  he talks about those reports ….

Keenon McCann bleeds from his wounds after he was shot on the Interstate-10 overpass near the Superdome in New Orleans on Sept. 1, 2005. McCann was one of at least 10 people shot by New Orleans police in the week after Hurricane Katrina.

For the past two years, Melville House author and ProPublica reporter A.C. Thompson (author of Torture Taxi: On The Trail of the CIA’s Rendition Flights) has been investigating mysterious killings in post-Katrina New Orleans. In December 2008, he published “Katrina’s Hidden Race War” in The Nation, a piece that examined reports of white vigilante violence after the storm. Beginning last December, in partnership with PBS Frontline and the New Orleans Times-Picayune, Thompson has been publishing a series of stories under the title “Law & Disorder” examining questionable shootings by the New Orleans Police Department in the aftermath of Katrina. And now the reporting is paying serious dividends.

According to a report from February 19, 2010, the F.B.I. immediately moved to investigate three of the  police shootings detailed in the Law & Disorder Series. And now, according to Thompson’s report from last week, the bureau is “investigating two more shootings described in stories we published in December…. Also, the city’s inspector general publicly accused Police Superintendent Warren Riley of illegally obstructing attempts to scrutinize police misconduct and disciplinary files.” This is in addition to two recent guilty pleas in connection with the Katrina police shootings: one from former New Orleans Police Department Lt. Michael Lohman,  who admitted to “conspiring to obstruct justice,” and one from Former police detective Jeffrey Lehrmann for “failing to report a felony.” Both pleas are connected to the Danziger Bridge incident, wherein police shot six citizens and which was also part of the ProPublica/Frontline/Times-Picayune investigation.

America’s last stand-alone book Sunday book review section is going digital: According to a report by Damon Kiesow at Poynter Online, “The New York Times is planning to offer its Book Review as a separate digital e-reader product, disaggregated from the rest of the Times content on the mobile devices.”

According to the report, “the Times will introduce a separate version of its Book Review for three e-reader platforms, beginning with the Sony e-reader in the next couple of weeks. Versions for Amazon’s Kindle and Barnes & Noble’s Nook will follow. [A Times spokesman] declined to say what the price will be for the Book Review on these platforms.”

New reports this week say that the movie studio MGM, which has been for sale since last fall, isn’t getting the kinds of bids it expected and is now seriously considering prepackaged bankruptcy. According to author Edward Jay Epstein, the author The Hollywood Economist: The Hidden Financial Reality Behind the Movies, the low bids, which are said to be just $1.5 billion–a far cry from the $5 billion MGM was bought for in 2004–trace back to a conference call about the studio’s TV revenues.

This post is the ninth in a series celebrating the publication of The Hollywood Economist. Click here to read all posts in the series.

The bad news came in a non-public conference call on February 22, 2010, to the 140 banks and hedge funds holding nearly $4 billion in MGM debt. MGM CEO Stephen F. Cooper, the turn-about specialist brought in to save the once-proud studio, revealed that the secret numbers memo circulated to potential buyers in the deal had been seriously inflated by MGM’s own over-optimistic estimate of its 2010 television revenue. The memo, which had been sent out by Moelis & Company to solicit offers from potential buyers, stated that “Television distribution has generated over $500 million of Library cash receipts in each of the last four fiscal years,” and it estimated that it would produce “$529 million” for fiscal 2010, which ends March 31. As it turned out, this number was inflated by about $120 million.

A library is made of two components: DVD sales and the licensing of movies and TV series to pay-TV channels, cable networks, and broadcast television. So, with the DVD market collapsing in 2009, the stability of television revenue, as represented in the memo, was (at least until the conference call) a key selling point to the remaining potential buyers: Time Warner, Lionsgate, John C. Malone’s Liberty Media, Rupert Murdoch’s News Corporation, Ryan Kavanaugh’s Relativity Media, Anil Ambini’s Reliance ADA Group, and Leonard Blavatnik’s Access Industries. Now, Cooper had stunning news. He told the 140 creditors that the library sales had been anything but stable, and plunged in the fourth quarter (so far) to the extent that the estimate had to be reduced by almost $30 million for that quarter. If annualized, this would amount to a decrease of about $120 million in revenue. Even worse, this severely reduces the value of the library since, as those in the business know, when MGM renews its multi-year contracts, the money it will get for aging product will drop precipitously. In MGM’s case, as I pointed out previously, a large part of these revenues must also be split with “third parties.” This includes producers, stars, directors, writers and Hollywood guilds, and, in 2009, amounted to over 40 percent of the total take.

The forbearance that MGM’s creditors extended to MGM expires on March 31. Now all the remaining bidders will have to drastically recalculate, if not reconsider, the amount they are willing to gamble. The Wall Street investors who put up most of the equity for the 2004 takeover have already seen their investment effectively wiped out. The suspense that remains in this Hollywood thriller is the degree to which the bond-holders will suffer the same fate. The bond holders cannot put the company in bankruptcy without jeopardizing the valuable remake rights to James Bond movie. So if the bidders pull out, or offer only pennies on the dollar, the only alternative open to the bond holders is to themselves take-over MGM by swapping their debt for equity–-but this is not the Hollywood ending they want.

Edward Jay Epstein studied government at Cornell and Harvard, and received his Ph.D from Harvard in 1973. His master’s thesis on the search for political truth (Inquest: The Warren Commission and the Establishment of Truth) and his doctoral dissertation (News From Nowhere) were both published as books. He is also the author of The Big Picture: Money and Power in Hollywood.

Edward Jay Epstein, author of The Hollywood Economist: The Hidden Financial Reality Behind the Movies, talks with Bloomberg’s Betty Liu about the role of film libraries in the financial health of movie studios and the outlook for independent filmmakers.

Matt Taibbi

When Vanity Fair contributor James Verini approached Rolling Stone reporter Matt Taibbi about his work on the shuttered Russian newspaper The Exile, Taibbi suggested that Verini consider killing the story. As he wrote in an email: “In the end nobody really wants to read about a couple of overgrown suburban teenagers writing about anal sex and the clap and then calling themselves revolutionaries when some third-world dictator gets bored of letting them stay published.”

But Verini persevered and Taibbi agreed to a lunch, though he again tried to talk the reporter out of the story, stressing that the story of the newspaper was best told in his 2000 book, co-authored with Mark Ames, The Exile: Sex, Drugs, and Libel in the New Russia.

I told him yes, that was true, but the book had been published in 2000, and, frankly, I didn’t think it was very good.

“The book wasn’t good?” he said.

“No, I didn’t think so,” I said.

“My book?” he said.

“Yes, the Exile book. I thought it was redundant and discursive and you guys left out a lot of the good stuff you did,” I said.

At this, Taibbi’s mouth turned down and his eyes narrowed.

“Fuck you,” he snarled, and then picked up his mug from the table, threw his coffee at me, and stormed out.

The following post by Edward Jay Epstein, author of The Hollywood Economist: The Hidden Financial Reality Behind the Movies (available from Melville House, and reviewed in the Wall Street Journal here), is the eighth in a series of posts. You can also see Epstein in Oliver Stone’s forthcoming Wall Street 2: Money Never Sleeps wherein Epstein plays the head of the Fed …. Click here to read all posts in the series.

This Sunday a global audience, second in size only to the Super Bowl, will watch television’s most lucrative infomercial—the 82nd Annual Academy Awards. For some three and a half hours, interspersed with clips from currently-available movies, Hollywood’s most publicized stars will ecstatically award the winners 13-inch-high gold-dipped statuettes known the world over as the Oscars.

The initial purpose of this gala event, which the studios created along with the Academy of Motion Picture Arts and Sciences in 1927, was, in the words of its main architect Louis B. Mayer, “to establish the industry in the public’s mind as a respectable institution.” But it was also designed to market and create “stars.” Mayer was cofounder of Metro-Goldwyn-Mayer, one of Hollywood’s most successful studios during its Golden Age (1930s-1950s), and is known as the father of Hollywood’s “star system” of marketing.

Yes, the stars will be out Sunday night, but to further enhance its global audience this year, the Academy has doubled the number of Best Picture nominees. Even with this expansion, attention remains focused on two polar-opposite films: Kathryn Bigelow’s “The Hurt Locker,” and James Cameron’s “Avatar,” both of which have garnered eight other Oscar nominations.

“Avatar,” on the other hand, is a fantasy-based movie about alien life forms who need to be rescued from neocolonialist corporate exploitation on a planet called Pandora. The film, enhanced by brilliant visual effects, may be the most expensive ever made. According to a top executive at Fox, it cost over $225 million to produce and another $150 million to publicize and distribute—a number that has been hyped to as much as a half-billion dollars.

Whatever the cost, “Avatar” has been an immense success, selling a record-breaking $709 million of tickets in the U.S., where it is shown in 3D as well as the traditional 2D format, and more than twice that amount overseas, where it’s shown mainly in 2D. For Rupert Murdoch’s 20th Century Fox, which gets its distribution fee off the top (as well Dune Entertainment and Ingenious Partners, the private equity funds that provided 60% of the financing, and James Cameron’s production company, Lightstorm Entertainment) it is a veritable El Dorado.

The film’s success at the box office has also excited hopes that its 3D visual effects will restore the Golden Age of movie attendance, a time before television when two-thirds of Americans went to the movies in an average week. Nowadays less than 10% go to a movie theater in an average week.

The overall box-office numbers, however, provide little grounds for such optimism. “Avatar” no doubt has enriched many theaters charging a premium for the 3D experience, but it did so largely at the expense of theaters showing other movies. In the eight weeks that “Avatar” dominated U.S. box-office receipts (Dec. 18 to Feb. 11), total movie attendance increased by about 6%.

But even if the audience resurgence is no more than a pipe dream, “Avatar” represents for many in the Academy the idea that Hollywood’s ultimate salvation lies not in superior story-telling and acting but in eye-popping visual effects, stunning animation and state-of-the-art 3D projection that immerse the audience in the illusion.

Regardless of box office receipts, Hollywood’s major studios have a sure-fire engine for making money from viewers who don’t regularly go to the movies. It’s what the studio calls its “library,” which contains the rights to all the movies and television series that it has ever produced or acquired. By relentlessly licensing and selling the rights to these titles, studios harvest money from home audiences decades after a film plays in theaters.

Consider, for example, the Time Warner library. It has more than 45,000 hours of feature movies, cartoons and TV episodes, dubbed or subtitled in more than 40 languages, that it licenses to pay-TV, cable TV, satellite telecasters and television stations in more than 175 countries. These titles are often bundled in take-it-or-leave-it packages (a practice that is prohibited by U.S. anti-trust laws in distributing movies to theaters), which helps optimize profits. In 2009, just the television distribution part of this operation brought in more than $2 billion, according to one source at Warner Brothers. A revenue stream this lucrative, even after paying residuals to guilds, labor and other participants, would be enough to pay for most, if not all, the costs of Warner Brothers’s new movies.

Libraries, of course, also pull in huge revenues from the global sale and rental of DVDs. (Technically, newly released titles are not included in the library for two years.) Even though DVD sales of movie titles and TV series are now waning, on the horizon is another promising revenue stream: digital rights for Internet delivery. While at present these rights provide little more than pocket change for studios, future revenues are due to explode with the proliferation of smart phones, netbooks, tablets, game consoles and other such gadgets. In any case, as one Viacom executive recently told me, “No studio could stay solvent for long without a library.”

If the studios’ libraries, the reality-based money machines that boost the bottom line, do not receive accolades or even a mention at Sunday’s Academy Awards, it isn’t that their value is unappreciated. It’s because Hollywood’s real genius is understanding that its audience prefers illusion to reality. The stars shine brightest on Oscar night. And that’s show business.

Edward Jay Epstein studied government at Cornell and Harvard, and received his Ph.D from Harvard in 1973. His master’s thesis on the search for political truth (Inquest: The Warren Commission and the Establishment of Truth) and his doctoral dissertation (News From Nowhere) were both published as books. He is also the author of The Big Picture: Money and Power in Hollywood.