A Hewlett Packard service called MagCloud lets you create and print a magazine online over the internet for about 20 cents per page. Powazek, Time magazine reports, made innovative use of the service, publishing a photo magazine about the storm within 48 hours of the event. Powazek drew on the work of about 70 Flickr photographers from whom he obtained permission via email. Despite a price north of $7 with shipping, Powzek has not turned a profit, but people clearly get a kick out of his product; one Australian even put in a special bulk order to redistribute back home (MagCloud doesn't ship there).

Issues commemorating the election and inauguration of Barack Obama and the death of Michael Jackson have likewise been rare bright spots for print publications. But it remains tough to make money from one-off print runs. If only there were some sort of large, internet enabled device with a display large and high-resolution enough to get people to buy these sorts of albums over the internet.

[via Daring Fireball]

That CEO, Mitch Fox, has announced the sale of the company's assets to a new company called 8020 Media Inc. If that sounds fishy — 8020 Media buying 8020 Media — it's because it is. The buyers include Adorama Camera, a New York-based photo chain owned by Hasidic Jews, and a group of Las Vegas investors — all represented by Brandon Calder, a Montana-based venture capitalist. An asset sale usually wipes out the company's current investors — in 8020's case, Minor Ventures, the venture-capital firm run by Halsey Minor, the founder of CNET, who has hit hard financial times himself.

8020 began life as JPG magazine and its companion website, both of which were founded by the husband-and-wife team of Derek Powazek and Heather Champ. Powazek and Cloutier cofounded 8020, which then bought JPG. Powazek was forced out in a power struggle with Cloutier in 2007. Cloutier himself left in a hurry a year later.

Meanwhile, the company hired Mitch Fox, a veteran Condé Nast ad salesman who'd just left the publisher (or been fired, depending on whom you ask), a year ago at a staggering $500,000-a-year salary — a figure Valleywag has verified firsthand through a look at the company's 2008 financials (included below). Fox vastly expanded the company, hiring expensive salespeople, launching a travel title, Everywhere, and preparing a fashion magazine. He more than doubled the company's monthly losses. Closing Everywhere did little to staunch the bleeding. 8020 ended the year with $300,000 in the bank and $3.6 million in losses, and Fox announced that the company was shutting down and putting itself up for sale.

Fox also mishandled the sale. SmugMug, a photo-sharing service, expressed interest in buying the company. But then Fox announced that a host of bidders had shown up — at which point SmugMug executives told Fox they weren't interested in a bidding war. Flickr, Yahoo's photo-sharing service, was also a rumored buyer — until Champ, who had joined Flickr as an employee, shot down the notion that anyone at Flickr or Yahoo was talking to Fox about acquiring the business.

8020's lessons? Don't hire a Condé Nast guy to run a startup, for starters. Studies have found that the best predictor of a startup's success is low CEO pay. $150,000 is the figure many cite. Above that, startups are more likely to fail, as the CEO lacks the proper motivation to turn the company into a success. Had Fox paid himself that much, the company would have doubled its cash on hand. Had he merely kept the burn rate at the level where it was when he took over, 8020 might have had another year of cash in the bank. And had he not tried to deceive potential buyers into thinking he was running an auction, 8020 might have ended up in friendlier hands.

Instead, to the end, Fox has tried to spin 8020's sale in as grandiose terms as possible, comparing its fate to the shutdown of the Rocky Mountain News. Here's the farewell email he sent:

While it's unfortunate that neither Hallmark magazine , nor the Rocky Mountain News could find buyers, we were able to swim against the tide and secure a great buyer, AND form this terrific joint partnership between these two companies with shared strategic objectives.

And now, after a hectic 47 days, hundreds, maybe thousands, of emails and countless hours on the phone and in meetings, I am delighted to report that the assets of 8020 Publishing, LLC (our official name) have been acquired by 8020 Media, Inc., a new company formed by a group of private investors, represented by Brandon Calder, for the purpose of executing on the unique vision that led to the creation of JPG Magazine, jpgmag.com and everywheremag.com. We are also pleased to announce that Adorama Camera Inc., a renowned leader in photography has reached a multi-year agreement to be JPG's Premier Community Partner and will also become minority owner of the new company.

In this difficult economic climate, business transactions take patience, finesse, intelligence and imagination, and we were lucky enough to find all these qualities in the unique group that brought this deal together. Above all, the new owners are able to see the immense promise that these properties hold to re-invent the media model and truly put the voice of the medium in the hands of its community

Adorama is a unique partner and brings an unrivaled passion for, and long-standing expertise in, the photography industry, which will be evident in the numerous exciting enhancements this relationship will bring to the JPG community.

My role, too, is changing, as I am handing the reins of the company over to my colleague, Mr. Seth Familian, who will become President and CEO of 8020 Media, Inc. As the key driver behind our digital innovation for the past year, Seth has proven to be an exceptionally capable new media leader.

Seth's plans for the business are exciting, ambitious and attainable, focusing on creative, yet practical, ways to grow both traffic and distribution, while effectively monetizing both the internet and print properties. I am sure we will all be hearing a lot about how he will develop these, and other properties on their way to becoming world class businesses.

As Vice President of Product Development for 8020 Publishing, LLC, Seth developed deep respect for the industry and the JPG community. Seth recognizes that member connection to JPG is the engine fueling its success, so member enjoyment of the site remains his core priority.

He understands how to provide opportunities that enhance members' experience, and has plans for new ways for members to share their work in many venues, which will all add to the excitement of the site's development and its value over the coming months and years. Additionally, Seth and the team are able to now reinvigorate the commitment to JPG's ‘sister' property, Everywheremag.com and look forward to developing that title while also exploring other potential opportunities for the company's business model. It's for these reasons that I feel the company is in very capable hands.

I will remain involved in the business as a member of the board of directors, and am excited to help Seth and his team in all ways possible to see 8020 Media, Inc. fulfill its promise and our dream.

In closing, I want to express my thanks to all of you who stayed close during this hectic process, and gave us your good wishes. It's always good to have friends checking in at times like this. I also want to thank Minor Ventures, especially Halsey Minor and Ron Palmeri, for believing in 8020 Publishing, LLC initially, and for working so hard to help set the enterprise off on a path that will launch it to the next level of success.

Below is the contact information for those people involved in the business now, so I guess it's time to update your address books.

See you soon I hope,

Until then, all my best

Mitch

8020 Publishing Profit

I know what you're thinking: Who starts a magazine company in this day and age? Ah, but 8020's founders had a twist on the old ink-on-paper formula: Readers would create most of the content for 8020's magazines on the Web, and a skeleton staff of old-school editors would pull it together into a glossy format. Advertising Age dubbed it 2008's "idea of the year."

Good idea, bad execution. 8020 shut down its second magazine, Everywhere, a travel title, in August. A plan to launch a fashion title came to nothing. And Mitch Fox, the Condé Nast ad-sales veteran hired last year as CEO, announced that 8020 had failed to find a buyer and was shutting down.

Now comes news of a last-minute reprieve: After the magazine world, wracked by advertising losses and shuttered titles, passed on a chance to buy 8020, some Web ventures expressed interest. 8020's one remaining title, JPG, a photography magazine, will likely never see print again. Instead, 8020's potential buyers see it as another Flickr, an online community of photo enthusiasts whose work can be cheaply and efficiently exploited.

Which is rather how Minor views his fellow entrepreneurs, from what we hear. His modus operandi: dribble out cash and keep startups coming back as supplicants, tin cup in hand. 8020 raised a grand total of $6 million in funding, and Minor's VC firm, Minor Ventures, owned more than half the company. That's a lordly sum for a Web startup, but a pittance for launching one new magazine, let alone three. (It didn't help that 8020 lost two of its founders — first, designer Derek Powazek, and then techie Paul Cloutier, the man who drove Powazek out.)

It's one thing to desire beautiful objects — paintings, historic racetracks, hotels, magazines. It's another to desire them but then change your mind about paying what they cost. It's beginning to look like a pattern with Minor, who is feuding with art auction houses and banks over his various holdings. The demise of 8020 seems peaceable in comparison. But it all points to a wealthy man whose greed is nevertheless larger than his wallet.

People who talk about 'building community' should go be architects. Because people are not bricks.

For Derek Powazek, 34, there are limits to what he'll share with his wife, Heather. The San Francisco couple has separate blogs; his focuses on digital media, hers on photography. Mr. Powazek says he sometimes sees her quoting his best jokes on her blog, and he tells her not to steal his material (she credits him after the fact). As for sharing one blog, the idea "never came up," he says. "It would be like saying, 'Let's share our underwear.'"

Alaina Browne and Anil Dash The foodblogger and Six Apart executive are not pregnant, though Dash has been looking a little chunky.

Heather Powazek Champ and Derek Powazek: Flickr's community manager and the famous Web designer are not pregnant.

Caterina Fake and Stewart Butterfield: Flickr's cofounders made no secrecy of Fake's pregnancy, which ended yesterday with the safe delivery of a newborn daughter.

Jennifer Granick and Brad Stone: The lawyer and New York Times reporter are expecting, and are telling people about it.

Maryam and Robert Scoble: Would you really expect Robert Scoble, whose blogger wife, Maryam, is pregnant, not to blog about the fact?

Now we all know: Ben Trott proved so irresistably hot that his wife and fellow Six Apart cofounder, Mena, found herself in a family way. Until recently, she'd been trying to keep the fact private.

To the pregnant couples: Heartfelt congratulations and best wishes. To Fake and Butterfield: Mazel tov! To Browne, Dash, and the Powazeks: Get cracking! Valleywag is going to need readers in 2025.

(Photos by Anil Dash, edyson, granick, jacksonwest, Scott Beale / Laughing Squid, and simoncast)

The contestants: Alaina Browne and Anil Dash, Heather Powazek Champ and Derek Powazek, Caterina Fake and Stewart Butterfield

Jennifer Granick and Brad Stone, Maryam and Robert Scoble, and Ben and Mena Trott

Gawker Media polls require Javascript; if you're viewing this in an RSS reader, click through to view in your Javascript-enabled web browser.

ETech 2006 rolls on, and Scott Beale keeps photographing the folks who make the Internet. Tuesday's highlights include Tim Bray's Indy outfit, Esther Dyson's spelling, and Jen King's primal scream.

Wired futurist Bruce Sterling Sun Microsystems demigod Tim Bray pops in from his Indiana Jones 4 audition.

Tribe.net's Chris Law isn't a friend of Kevin Burton. He just plays one on the Internet.

After the jump, Gob Bluth visits ETech. (Not really.)

ETech 2006 Photos [Laughing Squid, used with permission]
Earlier: Geeking out: ETech 2006 [Valleywag]

"And my Starbucks? Can you merge a tag folksonomy into my Starbucks?"

Simply Hired's Dave McClure: "Does your Google interview story involve a Rubik's cube and an attack dog? Yeah, everyone has that story."

Flickr'ing futurist "Esthr" Dyson: "A pleasre to meet you, I'm chrmed."

Designer Derek Powazek looks like a younger, taller Paul Giamatti. Just sayin'.

Technorati engineer Kevin Marks: "Well, if you don't like the new bubbly look, we'll just change the — no — no, shut up, I'm doing it now — we'll just change the site right back."

Weblogs Inc's Jason Calacanis is not just making a sign; he's worried and would like some peace, please.

Metafilter founder Matt Haughey: "If you bought the Segway to get laid, um, why'd you bring it to a tech conference?"

At the Yahoo party: "Heehee...hi, Mr. Semel? Mr. Terry Semel? Do you have Prince Albert in a can? WELL YOU'D BETTER GO OUT AND CATCH IT. Wait, wait, I messed up. Can we start over?"

Scott says, "[Berkeley student] Jen King's reaction to hearing web 2.0 for the 1000x time."

"Going Overboard Hair Club for Men.com. Works wonders, and it uses Ajax."