Sumner Redstone was the first major media mogul to get slammed by the economic downturn, and the Viacom chief's troubles continue. His pending divorce and the comical failure of his video game business are mere distractions. His bigger problem is that his company has $1.6 billion in debt to deal with, and Redstone is squabbling with his daughter about how to do it. For some, it's already too late; we hear that layoffs are coming down at Viacom tomorrow. But for the Redstones, there seem to be only three real options:

Important item: Has billionaire Lazard chairman Bruce Wasserstein, the owner of New York magazine, had some plastic surgery? Cityfile thinks so, after examining a current photo vs. one from two years ago. Then again, two years ago Wasserstein was rumored to be seriously ill. So maybe he just got over that? And is it really worth spending all that money to get plastic surgery when you're already 60 and married and not prowling the clubs for hot young things? I guess if you're a billionaire, you can do what you like, thank you. Click to enlarge the pic. [via Cityfile]

Vanity Fair has a new excerpt from professional media beef-starter Michael Wolff's upcoming biography of News Corp. chief Rupert Murdoch. Murdoch already said publicly that the book is flawed, but his problems with it seemed to center on how some of his business relationships are portrayed. The excerpt today, disappointingly, focuses on Murdoch's family life, and some of it is predictable. Friction between the new wife and the old wife and the kids from the old wife! Drama about succession! The only real interesting parts come when Wolff starts riffing on Murdoch's greedy ambitious kids and their Oedipal tendencies: Prue, Murdoch's eldest daughter, is a weirdo, says Wolff. But at least she didn't want to marry her mom, yuck!:

The Weinstein Co. has a few issues at the moment. Including—but not limited to!—the hasty departure of top executives; an ongoing struggle with Bravo over Project Runway, the company's strongest TV property; and a consistently weak outlook for Harvey Weinstein's myriad businesses. The one thing Weinstein's investors really have to look forward to is the possible success of the company's upcoming Kevin Smith/ Seth Rogen flick, Zack And Miri Make A Porno. But has the Weinstein Co. managed to screw up the film's prospects before it's even released? Last month the MPAA banned the movie's poster for being too raunchy. That was a huge red flag. The company responded by thumbing its nose with a cute little riff on the controversy, and continued on its merry way, marketing-wise. But ads for the film were still getting banned across the country. Now it seems to be sinking in that the very title of the movie could prevent it from being properly marketed and advertised, dooming it to box office failure:

Martha Stewart, a lady who made billions of dollars talking about stuff for your house and dinner parties and things like that and also went to jail once, is already feuding with her company's new co-CEO, Wendy Harris Millard. Recall that, just this past summer, Stewart's company pushed out Susan Lyne, the former CEO. Now even Millard (Lyne's replacement) herself acknowledges there's been "healthy debate," which means the shit must have been too bad to even try to deny. The "differences" are attributed to different "personalities." For example, Martha Stewart's personality is that of a tyrant. [NYP via Cityfile]

Imagine you have $800 million due to various banks in two months, and your chief holdings are a couple of billion dollars in rapidly-declining CBS and Viacom stock. You've opened some delicate negotiations with the bankers into how you'll, uh, pay them. What do you do? If you're Sumner Redstone, you immediately take the obvious option — sell some more shares! — off the table, and then proclaim you don't know how all this happened because you don't really run your company (National Amusements). Then in the future, presumably, you can tell your mouthy daughter you were "forced" to sell her movie theater chain because it was the only option left, ha ha. That'll teach her to try and be your successor! That's just how Sumner rolls, said the Wall Street Journal:

You know, movie mogul Harvey Weinstein may have his problems, involving Project Runway, a fashion line, a video distributor, an internet company, his wife's fashion company — they're endless, really. But the brash executive will be damned if he's going to feel ashamed to be losing four executives in the span of about six weeks. Because what that turnover really means is that he's an excellent people person! The departing staff, you see, started at entry level and were "groom[ed]" into "great executives," according to a statement sent to us by a PR firm representing the Weinstein Company. And what do great executives do? Get as far as possible from Harvey Weinstein, obviously. Click the icon to read the full statement.

Goodness, the bad news just doesn't stop for Harvey Weinstein. The movie mogul and Weinstein Co. head—who recently lost his bid to move Project Runway, his big moneymaker, to Lifetime—has had a rough time lately, dealing with everything from a flagging fashion line to a flagging internet company to a flagging video distribution service. So much flagging! And now the precarious nature of Weinstein's business is clear to everybody; his own executives are abandoning him, in a terrible job market:

It's official: Sumner Redstone's second marriage is finished, confirming our exclusive from Friday. Court papers were filed at the end of last week, according to the Los Angeles Times, and now the Viacom chief has issued a statement saying the split is "amicable" and that "we remain close and supportive friends." In other words, wife Paula Fortunato has finally, 14 months after divorce rumors surfaced, agreed to leave, perhaps because she got something beyond her "iron-clad prenup," once thought to be worth a flat $1 million, or because she's actually now earned $5 million, with the prenup now pegged at $1 million per year of marriage. Or maybe the former public school teacher is just tired of living with the mean mogul, 40 years her elder, and of hearing rumors he's been calling some famous comedian's wife. Whatever happened, Redstone is reaching into his pocket at a time when he can least afford it. Writes the LA Times:

We hear from a good source that Sumner Redstone, the 85-year-old media mogul who controls Viacom (which includes MTV, BET, Paramount, and Dreamworks), is separating from Paula Fortunato, his wife of five years. Fortunato will be moving out this weekend, our source says. Redstone married Fortunato—a former public school teacher who is 40 years his junior—in 2003, several years after he divorced his first wife. Redstone's finances are currently under a significant strain thanks to the recent economic meltdown, causing him a good deal of stress. Fortunato's biggest moment in the spotlight came when she reportedly forced her husband to break with Tom Cruise in 2006. There were rumors a year ago that the marriage was not happy; now, according to our source, it's all but over. Anyone with more information can email us. This may be the first sign that relationships based on anything other than love or sexual attraction will be sorely tested by this financial crisis. Another source tells us that Martha Stewart and Mark Burnett, the reality show maven who works with her, "had a giant blowout, over money." Along with the timing of this Sumner Redstone rumor, it paints a grim picture. Let's hope this doesn't get so bad that it filters down to the non-rich.

Arianna Huffington for many years sought to downplay the extent of her involvement in the Movement For Spiritual Inner Awareness, a cult ex-members described as sexually and financially exploitive in a series of Los Angeles Times exposés in the 1980s and 1990s. During her then-husband's 1994 U.S. Senate run, the Greek-born socialite claimed movement founder John-Roger (pictured with her at a 2004 book party, left) was a mere friend, and pictures of him holding her daughter were ordered withheld from the group's newspaper, the editor later said. But the Huffington Post editor-in-chief is an ordained "Minister Of Light" in the group and once described John-Roger to Interview as her "way-shower." She relaxed a bit in the New Yorker's Oct. 13 profile , admitting she had been too "defensive" about John-Roger, and allowing writer Lauren Collins to listen to a guided MSIA meditation stored on Huffington's iPod. But she wasn't entirely forthcoming. What about the role she has fashioned for her cult in HuffPo staff development?

Old Viacom overseer Sumner Redstone announced last week that he had to sell hundreds of millions of dollars worth of his company's stock, after the Wall Street crash left him short on cash to back a huge loan. Then this week, out of the blue, his daughter Shari Redstone, who runs the movie theater portion of National Amusements (the other parts being Viacom and CBS), sent out a statement to the media saying, basically, "HEY, THIS ISN'T MY FAULT!" What's the deal with this madness? Shari wants to run the whole company whenever her dad keels over, but her dad's not so sure that's a good idea, so they kind of hate each other. Sumner never even said that this whole stock sale was the fault of the movie side of the business; Shari went public anyhow:

The Observer assembled a story headlined "Twilight Of The Media Idols," keyed to a woe-is-big-media panel discussion at the Time Warner Center. Trouble is, many "media idols" seemed to be basking in a sunny glow: Time Warner Chairman Dick Parsons and Comedy Central host Lewis Black were bounding around with their entourages, Richard Stengel of Time proclaimed a "golden age" for "quality content" and the likes of Candy Crowley (CNN) and even Hillary Clinton strategist Mark Penn were inundated with j-school groupies. But the Observer's men did find the perfect foil amid the moguls: Sad former Times editor Howell Raines, who couldn't even get anyone to look at him. Apparently his Portfolio column hasn't given him any media cred. The scene:

Paging Dr. Redstone: Viacom president Philippe Dauman was optimistic Tuesday in Cannes, where he downplayed Sumner Redstone's move this week to sell off $233 million in stock to help pay down the company's debt. We guess it is better than last week's estimate of $400 million, but Dauman isn't letting numbers get in the way: "If you have a life-threatening crisis," he said, "there is no one on the planet you would more want to have by your side, helping you figure out how to get out of it, than Sumner Redstone." Oh, please, Philippe — we love Sumner, too, but everyone knows that nobody assuages A-list panic better than Werner Herzog. [Variety]

The New Yorker's big Arianna Huffington profile may have been a letdown, with very little dirt on the politics or business of the Huffington Post, as we said yesterday. And, granted, it also failed to establish that the HuffPo publisher is a "cutthroat boss," as the Post hinted it would. But those who have spent time in Huffington's orbit seemed determined to have their say. And so it is that we have come to understand more clearly Huffington's seemingly strange remark that " a lot of people who came to the office wanted to be writers" at HuffPo but left because "the jobs are administrative." That quote left one to wonder if people signed up to be Arianna's administrative assistants and were upset because they couldn't get bylines. But no. People signed up to be editors, we hear, and were upset because they were asked to do the work of household assistants.

Tina Brown unveiled this morning her new internet venture, the Daily Beast. The Post's Keith Kelly said the website, a revival of the fictional paper in Evelyn Waugh's Scoop, is in the "soft launch phase," meaning apparently that it's devoid of advertisers, and that it "sees itself as a must-read for hipsters in news, politics and pop culture." Ahem. From our quick look — it temporarily went password protected as we were reading — the site seemed more noteworthy for its slavish devotion to internet publishing memes than for any particular innovation. Some traffic-baiting Apple coverage? Yes, there's a column by former Think Secret publisher Nicholas Ciarelli. Celebrity contributors? Sure, if you count the likes of Bill Clinton, who mails in book recommendations, and Project Runway alumna Laura Bennett, who posted a column. There's counterintuitive, Slate-like material such as "Why I Call My Wall Street Patients Pussies," by an ostensibly caring psychiatrist. And, as if to prove she is now truly blogger, Brown concludes her debut column with the one-word sentence, "Heh." Soon she'll emailing Digg requests to her old publishing friends and trying to get to 10,000 friends on Facebook, and we'll all find it hard to imagine she ever edited the New Yorker.

The New Yorker published its profile of Arianna Huffington. Though disappointingly far from the juicy takedown we hoped for, it does contain a few interesting nuggets. We learn, for example, that the Republican-divorcée-turned-internet-publisher bizarrely "hides" all three of her BlackBerrys in her bathroom at night, even though she lives only with a housekeeper and her two daughters. Her gay ex-husband Michael Huffington elaborates on how she knew of his interest in men before their marriage, saying, "in my Houston town house I sat down with her and told her that I had dated women and men so that she would be aware of it." And Huffington sounds downright proud of her lack of long-term friendships, saying, "I metabolize experiences fast." But there's so much missing, so much that should be in this 14-page story, starting first with how she runs the Huffington Post — would any male mogul be profiled at such length with so little said about how he runs his business? — and continuing through to juicer questions about her dating life and cultlike religious guru. A few specifics:

Sam Zell is the gnomish CEO of Tribune, a company with a bunch of nosediving newspapers and one valuable parking lot. Luckily the Tribune Co. is owned by the happy employees themselves, leaving Zell with enough liquidity to throw himself huge, circus-like birthday parties. Did you miss your invite for his last one? Check out these pics of the frugal decor and musical guests!:

What was Harvey Weinstein thinking? The movie mogul is already being dissed by once-pliant reporters and magazines, and struggling to right his company and other investments. Now he's given more ammunition to the haters and socked his pocketbook, all in one fast miscalculation. The Weinstein Company chief reportedly told the Post's Page Six he doubted the authenticity of an email quoted by aggressive Hollywood blogger Nikki Finke, and offered $1 million for charity if Finke could produce the original. The email, from movie producer Scott Rudin, concerned a feud over the release date of Kate Winslet vehicle The Reader. Page Six called Finke tonight and guess what? She has the email, and has already posted it. UPDATE: Rudin told Page Six Finke is lying. UPDATE 2: Rudin admits he lied to Page Six! See below.

Rupert Murdoch seems to have transferred his politician crush from Barack Obama to Sarah Palin. His tentative support for Palin (and her obscure running mate) on the financial meltdown tonight evolved into a "quite chummy" run-in at a charity gala for the Manhattan media elites Palin claims not to care about. Murdoch gave Palin a pat on the back and said "thank you very much" as Palin left the gala, while Palin wore the "radiant smile" of not caring, according to a media pool report summarized by Politico. And to think that just four months ago Murdoch called Obama a "rock star." What happened?