[Brown man Tom] Tapp is sending out increasingly desperate-sounding emails to flacks working for studios, tenpercenteries, big producers and PR firms begging for help. ("Hey Man, We need to get moving on this. Any chance we can set something up in the two weeks?")

Finke reports that Hollywood players think Brown's star is fading and hate the moguls she has consorted with — Harvey Weinstein, Mike Ovitz and now Diller.

But there's a strategic error, as well, in Brown's attempt to cozy up to Hollywood: The Huffington Post already has the town in a blog bear hug. Good luck getting between celebrities and their beloved Arianna!

Meanwhile, Brown is angling to lead the revival of Alistair Cooke's Letter From America radio show on the BBC. How 20th century. A real internet mogul would stoop to nothing more retro than a niche-y podcast.

There's one person apart from shareholder John Malone who stands to lose when IAC is broken up: Alex von Furstenberg, adopted son of the internet conglomerate's boss, Barry Diller. The shaved-headed socialite, Diane von Furstenberg's son by her first gay husband, will still inherit a large part of his adoring stepfather's fortune. But after IAC is divided into five, Alex von Furstenberg may have trouble securing the front-row seats at Lakers games that are such a mark of social status in Los Angeles, where von Furstenberg has lived since 2005. He's been relying on Diller's office to cadge tickets to the bastketball games from Ticketmaster, the online ticketing service which IAC is spinning off. The IAC boss will remain chairman of Ticketmaster after the split, but one peons still hopes Diller and his relatives will no longer be able to use the service as a personal favor bank.

I am an employee at Ticketmaster and there is one major reason that we are counting the days until we are spun off from Barry Diller's IAC. Alex von Furstenberg. Barry Diller's stepson demands front row seats to every Laker Game in LA. His request trumphs all other Laker ticket requests from our President, CEO, celebrities, or valuable clients. His sense of entitlement is far worse than people we like to give tix to like Jack Nicholson, and he hasn't even done anything to earn it! What makes it worse is when other Ticketmaster employees look at the court seats we give him (from their nosebleed seats), they are empty because he misses the game! He is the biggest spoilt brat on the West Coast.

Those words could so easily be used to describe the former studio head's marriage blanc to fashion designer and longtime friend Diane von Furstenberg. Diller's widely known to be gay; a former boy-toy even wrote a lightly-veiled account of his two-year relationship with a tycoon nicknamed 'Bear' who sounds much like Diller; and his for-show relationship with Diane von Furstenberg has long been the subject of amusement among Hollywood insiders.

Here's just one tale that makes the rounds. At Ed Limato's pre-Oscar party, Barry and Diane (who had just recently tied the knot with a lot of eyerolling from those attending) were hanging out. People were sitting with comedians Steve Martin and Martin Short. Short noticed Barry was there with his bride, and said, “Isn’t it a shame that Barry and Diane feel they have to be here swanning and glad-handing for political reasons when they could be at home doing it?”

[Times]

In the first scenario presented to Diller above, "Structure A," his shares would be guaranteed at their then value of $40.58, but Diller could never realize a price increase to beyond $44.64 per share.

Sure enough, in the year after entering in to the "complex series of transactions," IAC shares declined 50 percent, while Diller was protected, at least according to the leaker who provided the document.

Government or company regulations may have prevented Diller from outright selling his shares at the time, but even if they hadn't, announcing a "pre-arranged stock trading plan" in a press release sounds so much better than disclosing in an SEC filing that you are dumping a bunch of shares, as illustrated by the sample press release included in JP Morgan's presentation to Diller. Here's the top of one:

Not that Diller's tactics are surprising; these sorts of crafty tactics are exactly how the ruthless mogul retains control of his company against the wishes of his dominant shareholder and apparent teacher, John "Darth Vader" Malone.

It's not as if Diller has kept his sexuality such a secret.

Sure, he threatened Michael Wolff if the media columnist, then at New York magazine, wrote about his personal life. "No. I don't think you understand," he told Wolff. "I would kill you." And a memoir by a former escort who claimed to have bedded various members of Hollywood's gay mafia was expunged of all references by name to Diller; though a character nicknamed The Bear, bearing some resemblance to the compact tycoon, did make an appearance.

But, at least at the level of gossip, Diller's inclinations have been a staple for at least two decades among journalists, fellow media magnates, the gay establishment, and their catamites. Diller has done little, beyond vague threats to journalists and publishers, to dispel the rumors. The tycoon's donations to charity include many gay causes. His former yacht, the appositely named Black Sheep, regularly docked at Provincetown, the gay summer resort on Cape Cod. (See video.) Page Six even reported, three years ago, that the high-living mogul "partied" aboard the boat with Chris Beckman, a pretty boy from the Real World: Chicago.

Several authors have gone beyond mere implication. The Operator, Tom King's biography of David Geffen, the most open member of the velvet mafia, states baldly that Diller is gay. Both Geffen and Diller were immediately sought out by the press when Michael Ovitz, the once-mighty Hollywood agent, blamed a mysterious gay cabal for his professional demise. And Maer Roshan, ridiculing the discretion of known gay celebrities, referred in New York magazine to Diller's long-term relationship with a former editor-in-chief of The Advocate, the gay magazine.

So why does Diller bother? There seems little doubt that the IAC boss and Diane von Furstenberg are close friends; they have known eachother for decades. In the homophobic Hollywood of the 1970s, it was probably useful for Diller to confuse the issue of his personal life. His counterparts might suspect, or know; but there was enough contradictory information to prevent exposure by the press. That's now less of a reason for dissimulation, of course: the dam has broken; newspapers and magazines, facing competition from gossipy blogs such as this, are much less easily browbeaten by privacy-obsessed moguls; they can't afford to repeat the official line without looking craven. Diller's marriage to Diane von Furstenberg was described, even in the normally straight New York Times, as a "merger".

But there's one other reason for Diller's marriage of convenience, and it's quite touching. Diller has no children of his own. Diane von Furstenberg, and her children Alex and Tatiana, are the closest the solitary mogul has to family. Diller is said to be particularly fond of Diane's 38-year-old son, pictured left. "He really loves Alex," says someone who knows them both. Diller deeded Alex his house in Malibu on his first marriage (no word yet on what the wedding present will be for his second, to Ali Kay, disclosed in today's Page Six).

That's not the extent of Diller's financial support: Diller has already financed Diane von Furstenberg's fashion label; it is widely assumed that he will leave his fortune to Alex and his sister. Which provides an explanation for the merger, if not for the pretense of a wedding ceremony, so bogus that David Geffen refused to attend. Marriage, apart from presenting a front to conservative high society, does make it easier to avoid inheritance tax. Now Diller had better fend off his hostile shareholder, John Malone, and extract some value from IAC's languishing portfolio of internet businesses.

The gay billionaire, who marries his fag hag so that he can support her children: that's an uplifting narrative; it loses some of its dramatic power if the billions evaporate.

Media conglomerates such as Time Warner, which went through its own disastrous mega-merger with AOL in 2000, seemed finally to be recognizing that size wasn't everything. “Whether [Time Warner] is the biggest is not the main thing," said Jeffrey Bewkes, Time Warner's incoming chief executive. "It needs to be the most profitable." Sumner Redstone last year spun out Viacom's traditional media businesses such as TV network, CBS. And Barry Diller's IAC is, even if only after pressure from disgruntled shareholders, being broken up.

Now one can be sure every media company chief executive is running around like a headless chicken. They know that their future depends on internet advertising. For the moment, the bulk of the growth appears to be going to those properties with the biggest audience reach, which scares smaller media companies. Add in a mega-merger they don't understand: it's the perfect environment for media bankers to present consolidation as inevitable and their hair-brained schemes as urgent.

Most of these ideas will come to nothing. But someone who understands the web just enough to be dangerous, will be panicked into a moronic deal. (Arthur Sulzberger of the New York Times, maybe, though he's hampered by the family legacy). Microsoft will survive the hugely expensive and wearying combination it is now proposing. Traditional media companies which follow its example don't have the luxury of making the same mistakes.

L.G. But you’re purported to own the largest sailing vessel in the world now [the 300-foot-long Eos, for which Diller paid an estimated $200 million to build last year]. What’s that about? I mean, people have all kinds of theories on why rich guys buy big yachts.

B.D. I promise you, it’s not about size, it really isn’t. I mean, it’s not for me. I’ve had sailboats, and when I started to think about building a boat, I wanted to have a boat that had really good sailing characteristics and at the same time I wanted a boat that could hold my family and friends and be as comfortable as I could conceive it. And when we put those things together, it just dictated the length of the boat. It wasn’t backwards, like I said “I want the biggest boat.” It’s inconceivable that I’d say that. And I’m sure that at some point fairly soon I won’t have the biggest boat.

L.G: [Laughs] That's for sure!

B.D.: But I wanted a three-masted schooner. By definition it had three sticks in the air, it's going to be a little large, because that was the kind of sailing craft I wanted. It's not huge, Eos, and as a matter of fact one of the great things about it is its profile is not imposing, certainly not from some big white refrigerator. [Laughs] Big motor boats are usually white, and they're big, they're very imposing. That's not bad, but that's not my sailboat.

L.G.: If you like big white refrigerators!

B.D.: Whatever. Some of them are beautiful. But, you know, in this thing of boats, it's like planes. There's no justification for this, it's just I'm lucky enough that I got to build something that I had more fun than anyone deserves in building it, and now I'm having even more so in me and my family enjoying it.

L.G: Is that it for you, you think, in terms of being happy with this one for a while?

B.D.: No. I'm sure I'll get hungry for doing another boat as well at some point, another stripe of another kind. Once you're in boats, you either go bankrupt or you keep going.

[From Lloyd Grove's interview with the IAC boss]

• Ask. Diller said he planned to spend $100m developing and promoting IAC's flagship search engine. After an impenetrable advertising campaign, touting Ask's New Jersey algorithm, what's the impact on the search engine's market share? Nothing measurable. The chief executive, a Diller favorite, is out.
• Vimeo. Josh Abramson and Ricky Van Veen's College Humor remains popular among college students and those whose humor remains frozen in sophomore year. But IAC's bigger interest was the online video site, a precursor to Youtube, which the College Humor techies set up in the spare time. Vimeo creator and Julia Allison cheater, Jakob Lodwick, was fired late last year. Vimeo's traffic is hardly measurable beside Youtube.
• VSL (a highbrow email newsletter of cultural recommendations dreamed up by Kurt Andersen and Diller's content guru, Michael Jackson) is close to Diller's heart. "Without Very Short List, I would be much diminished," said Diller. Unfortunately, the internet as a whole would not be. Last time I checked, the subscription list was only some 20,000 people. (I'm told the base has grown several hundred percent since then.) Culturally-literate email-reading billionaires are in short supply.
• 23/6, IAC's stab at political humor with the help of the Huffington Post, is stillborn. Michael Jackson's other joint venture, a business site done in collaboration with Dow Jones, may never even get off the ground. Says one insider: "It's obvious it won't work somewhat from the outside but the inside scoop is zero progression/movement. As Sanchez (IAC's foul-mouthed head of corporate communications) might have said, just a lot of wanking."
• Lending Tree will be spun off for less than half the price Diller paid for it. This is not the best moment in the cycle to sell a mortgage broker. And the mogul did himself no favors by alienating Rich Barton, an IAC board member, who left aggrieved after Diller spun out Expedia, his online travel agent. Barton founded a competitor, Zillow.

IAC holds some prospering and substantial businesses such as Ticketmaster, the online ticketing site, and Match, the online dating exchange. But even these have been forced uncomfortably to walk in lockstep with IAC's other businesses, even when the logic has been flimsy. The unvarnished truth is that Diller, who built up Fox into the fourth television network for Rupert Murdoch, has a dismal track record in running internet businesses. No amount of Diller's brutal charm can obscure that.

What the mogul does have is the contrarian courage of a great investor, and a mastery of the dark arts of corporate infighting. He acquired e-commerce assets during the downturn, when other investors had written off the internet as a blip. And he's playing hardball with as much skill and ruthlessness as his disgruntled shareholder, John 'Darth Vader' Malone.

That raises the question. Why does Diller, a 65-year-old who enjoys his yacht and parties he throws with his hostess, fashion designer Diane Von Furstenberg, even pretend to run these businesses? He should not be the plucky entrepreneur fighting off the evil corporate raider. Diller is on the wrong side of that eternal conflict. He has certain skills and the temperament, just none suited to a managerial role. The detached and machinating capitalist played in the current struggle by John Malone? That should be, in the next business life at least, Diller himself.

[Redacted]: we got mailed a t shirt from 23/6, that huffpo humor site. i am staring at it now! I bet it will generate "buzz."
pareene: hah
pareene: is it a "funny" shirt??
[Redacted]: on the front it has their tagline, and on the back it says "tagg romney is a stupid name"
[Redacted]: which is funny enough I guess
pareene: ha
[Redacted]: exactly the level of funny I was expecting
pareene: funny until south carolina
pareene: then billy beer
[Redacted]: i have no idea what to do with this shirt. it's fucking huge. it would be perfect for pre-slimmed down huck
[Redacted]: maybe that 500 lb policeman
pareene: it would be better if the shirt just said "more like FAG ROMNEY"
[Redacted]: ha
[Redacted]: that would be awesome
pareene: then you could wear that xtra large novelty t-shirt with pride

Diller recently spun off his conglomerate into five new companies, due mostly to a complicated and lengthy fight with a "reclusive billionaire" major investor. This also helped fight claims that IAC was "a random hodgepodge" of disparate companies, except that the groups that remain under the IAC umbrella are a random hodgepodge of internet companies, "united under the loose banner of 'helping consumers.'" Like, uh, Zwinky, which helps consumers make Zwinkys. And CollegeHumor, which helps consumers find IAC-owned websites where they can buy funny t-shirts.

And speaking of CollegeHumor! Connected Ventures, the booze-soaked internet frat party that generates lots of great traffic from coveted demographics, will not be moving into the IAC GehryDome. Because although CollegeHumor EIC Ricky Van Veen promises that Diller gets them, he is aware that they might be a distracting presence among the grown-ups.

"Barry okayed us not going into the new building because he understood it wouldn't mesh. There was a Heely craze at the time—literally half the office had Heelys," said Mr. Van Veen, referring to the sneakers with built-in wheels that seemingly every child in the world was wearing at one time. "Talking to Barry, I think he realized he didn't want Heelys scraping up those brand-new floors."

It's Diller Time! [Observer]

Apparently it's another attempt to clone the Onion, though this time with an infusion of Daily Show DNA by way of the Huffington Post. Slated for birth in 2007, the "continuously updated satirical Web site" will "deliver throughout the day the kind of humor that has been the preserve of late-night talk-show hosts like Conan O'Brien and the Comedy Central stalwarts Jon Stewart and Stephen Colbert." The site will be overseen by one Ben Wikler, "a comedy writer who has worked closely with Al Franken." With luck, Wikler will bring a little of that Air America magic to the table.

Diller claims no interest in big-ticket acquisitions, dismissing such as the domain of "media imperialists." He and Jacskon prefer "starting their own ventures and investing in nascent ones." So no Facebook-style deals, but when you're talking nascent, you can't ever be too nascent to attract (or continuously plead for) a little investment injection.

Most pregnant with foetal potential is one final throwaway line in the NYT article, reading thusly:

[Jackson] said his next area of focus might be news — a site that aggregates and edits news and helps point people to the best information available — but he was not ready to talk about specifics.

Diller's Web: Think Cable of the Past [NYT]
[Photo: zachklein]