• by Joe Mandese  @mp_joemandese, November 12, 2009

The big question is, what falls under "etc.?"

Asked by analysts during Nielsen Co.'s third-quarter earnings call about reports that the company was close to selling some of its highest-profile business media assets, including The Hollywood Reporter, CFO Brian West declined to comment, but offered some fairly cryptic guidance. He implied that Nielsen might actually hold onto its most "iconic brands," including "THR, Billboard, etc.," as long as they are "very strong in their class" and have an "online capability" and a strong "trade show element" to them.

Currently, he said, both the advertising and trade show sides of those businesses have been challenged by the economic recession, but Nielsen Co. believes the trade-show business will come bounding back once the economy begins trending upward. He seemed less sanguine about prospects for business-to-business advertising growth in the Nielsen business publications.

"Our view is that we have to ride it out," he said, adding, however, that for "assets that don't hit the mark, we are always looking to work them out of the portfolio."

In response to an analyst's question about the vitality of the M&A market for those kinds of asset sales, West said: "It's very much touch and go." For the foreseeable future, Nielsen was focusing on "sticking to its knitting" where its trade publications are concerned.

The analysts' questions follow a report by industry blog "The Wrap" that Nielsen had sold The Hollywood Reporter -- and possibly other trade magazines, including Adweek -- to James Finkelstein's News Communications.

If such a deal has been struck, or is in the works, it's unclear what kind of valuation the private equity-backed Nielsen Co. got for them.

According to Nielsen's third-quarter earnings report, the business media publications have been the primary laggard in its portfolio.

Revenues for Nielsen's Business Media division fell 28.5% to $82 million during the third quarter of 2009 vs. the same quarter in 2008. On a constant currency basis, business media revenues were down 28.3%, and Nielsen attributed the decline primarily to "lower publication revenues caused by industry softness," some divestitures, and lower exhibitor attendance at its conferences and trade shows.

West said publishing revenues were down 33%, adding that this was related to a "continued slide in the overall advertising market."

Operating income for Business Media declined 54% to $14 million during the third quarter.

Despite the drain from those operations, Nielsen turned in a remarkably stable quarter, with reported revenues declining just 0.8% over the third quarter of 2008. On a "constant currency" basis, West said Nielsen's revenues actually grew 3% during the quarter.

Moreover, the company's operating income actually grew 10% to $187 million during the third quarter, and on a currency adjusted basis, was up 16%. That's not bad for a company whose clients' businesses are generally declining at single- to double-digit rates, according to Nielsen's own research and tracking data.

According to Nielsen's most recent tracking data, U.S. ad spending fell 15.4% during the first half of 2009, across the media it measures. Nielsen has not-yet-released estimates for U.S. ad spending through the third quarter of 2009, but recent ones from major ad agency holding companies indicate some slight improvement. Advertising continues to erode at double-digit rates for the overall ad and media industries.

In terms of its media-research business, West said Nielsen's focus is on its ongoing "three-screen" strategy. Both cross-platform measurement and digital set-top audience data are core components. He even said that the recently launched Coalition for Innovative Media Measurement (CIMM) is recognition by Nielsen clients that the industry is looking for more "clarity" about the migration of viewers from TV to multiple-screen platforms.

"We play a role in helping to navigate this," he said. "As it plays out, we think it's an opportunity. We're optimistic."