Guggenheim Partners today announced the hiring of a badly needed digital media CEO, presumably to put some fiscal diet discipline over its assets including The Hollywood Reporter‘s bloat. In the process it has removed the last remaining Prometheus Media equity owner managing THR after its 2010 purchase. Gone with the wind is Jimmy Finkelstein, who tried unsuccessfully to turn the publication into a profitable venture. Guggenheim announced that it has acquired the remaining stake in Prometheus Media from Pluribus Capital, which was founded by Finkelstein, who previously served as  Chairman of Prometheus Media. So here’s what happened: it’s been well known that the disliked Finkelstein clashed often with Guggenheim, which for the past year installed its own bean-counters to monitor the celebrity sheet. And inexplicably in July Guggenheim placed Dottie Mattison in charge, even though she is known for loving the Red Carpet limelight more than overseeing the journalism of the job. Finkelstein had a reputation around the Reporter as a nasty piece of work, so there will be lots of dry eyes to see him go. He never understood that, to make the publication profitable, costs had to be slashed and not constantly soared, to Guggenheim’s horror. The fault lies with Guggenheim’s Todd Boehly, whose lousy idea it was to buy into Hollywood — and now can’t wait to get out so he can continue investing in sports. (His newly acquired Dick Clark Prods just effed-up Sunday’s Golden Globes production-wise.)

One of the problems was that Finkelstein, who owned legal trades years ago, overestimated his own ability to turn a profit in today’s crowded consumer media marketplace. Although it’s true that The Hollywood Reporter has enlarged its one-off traffic, it still is not widely consumed by the entertainment community. Instead Hollywood and the businesses that rely on it are addicted to lean and mean Deadline Hollywood, which focuses exclusively on showbiz instead of celebrity. THR‘s plan under original Prometheus Media CEO Richard Beckman was to publish a subscription-based magazine. That quickly fizzled, and the Reporter print edition is distributed free for the most part (and to zip codes like Florida). Beckman, who was hired in 2010, was demoted in 2011 and then kicked to the curb in June. Finkelstein would have met the same fate earlier except he was an equity owner in Prometheus Media and convinced naive Guggenheim to let him try to affect a turnaround. Now his removal paves the way for Guggenheim to finally sell the Hollywood trade, something the investor has wanted to do almost from the beginning of its asset acquisition which was always plotted as a fixer-upper to be flipped.

Meanwhile, Penkse Media Corp (owner of Deadline Hollywood) is still waging its lawsuit against The Hollywood Reporter for copyright infringement.

Here’s Guggenheim’s release today:

New York and Los Angeles, January 15, 2013 – Guggenheim Partners, a global  diversified financial services firm, today announced that it has formed Guggenheim Digital Media and named Ross Levinsohn Chief Executive Officer. As a part of its investment in GDM,  Guggenheim anticipates allocating significant capital to acquire and invest in new media companies and properties that will meaningfully expand its current portfolio.

Guggenheim Digital Media will also oversee and operate the existing Prometheus Global Media assets that Guggenheim controls, including the iconic brands of Billboard, Adweek, and The Hollywood Reporter. GDM will continue to invest in both the print and digital versions of these properties,
developing cutting-edge and industry-leading products. It will continue to manage The Film Expo Group
and CLIO Awards, and partner with additional Guggenheim assets to further develop their digital media
strategies, including Dick Clark Productions.

“GDM will play an integral role in developing our iconic portfolio of existing media and entertainment
assets, as well as identifying new, groundbreaking investments and partnerships in the music, media,
technology, and digital entertainment spaces,” said Todd Boehly, President of Guggenheim Partners.
“Ross’s deep industry expertise and impressive track record of executing digital media strategies make
him the ideal person to spearhead this new effort.”

“I am excited to be part of the dynamic Guggenheim family of companies,” commented Ross Levinsohn.
“GDM has a powerful and competitive portfolio of iconic media assets today, and I look forward to
identifying new opportunities for growth as the media and technology industries continue to rapidly
evolve.”

Prior to joining Guggenheim, Mr. Levinsohn served as interim Chief Executive Officer for Yahoo!.
Previously, he served as EVP and Head of Global Media for Yahoo!, where he was responsible for all
aspects of Yahoo!’s digital media business, including the vision, strategy, product, partnerships,
engineering, and content creation for its marquee properties and content experiences globally. He joined
Yahoo! in 2010 as EVP, Americas, overseeing its largest regional business.

In addition, Guggenheim announced that it has acquired the remaining stake in Prometheus Global
Media from Pluribus Capital, which was founded by Jimmy Finkelstein, who previously served as
Chairman of Prometheus Global Media.

“We have enjoyed a successful and profitable investment with Prometheus, and Guggenheim now has a
dynamic runway for continued success, especially in light of their recent acquisitions in the media
industry,” said Mr. Finkelstein.

Mr. Boehly continued, “The partnership between Guggenheim and Pluribus has produced dynamic and
growing brands. We credit Jimmy for his leadership and wish him the best of luck in his future
ventures.”

Editor-in-Chief Nikki Finke - tip her here.