straightguysca.com

NEW YORK -- Walt Disney Co. on Tuesday announced it will form a new company with Wenner Media, owners of Rolling Stone and Men's Journal, to tap into the content of US Weekly for its various entertainment Web sites such as Mr. ShowBiz and SoapNet.

As part of the deal, Disney will acquire a 50-percent interest in US. Terms weren't disclosed.

The new entity, named US Weekly LLC, will remain in New York. The deal was announced by Disney Chairman and CEO Michael Eisner and Jan Wenner, chairman of US at a press conference in Disney's ABC midtown studios.

The move comes just a day after Disney detailed a second round of cutbacks in its Disney Internet Group division, which is currently being folded into its traditional media operations. In addition, a slowdown in ad spending has forced many online and offline magazines either to scale back or shutter entirely.

But Eisner defended Disney's magazine and Web publishing operations, joking that he was informed by Tina Brown that ad revenues were fine at pop culture publication Talk Magazine.

"I think there is a big opportunity in this space as a lot of people move away (from it)," Eisner said. "We have content and technology and now we have to find a way to drive it home."

Wenner added that ad revenues for US were better thanks to the magazine's March 2000 relaunch when the publication shifted from monthly to weekly schedule.