After the back page Cartoon Contest and glancing the table of contents, the first thing we read in The New Yorker is James Surowiecki's excellent Financial Page column. Generally, he's penning a consumer-oriented story. Even when he's talking big picture things, like the credit card industry or free-trade, Surowiecki always brings the conversation to the person level: How does this affect you?

Not in this week's issue, which makes his topic choice – CBS's foolish decision to buy CNet for some $1.8 billion – all the more interesting. Clearly, this subject stuck out to him: Why would a giant media conglomerate feel the need to spend billions on a digital content company.

He does not write with any less vigor.

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"Every Internet and media company has looked closely at CNet. They are intrigued because it is a leader in its category of tech news and reviews, with some good technology and brands. But it is growing slowly, and its cost base is so high that its profit margins are meager. And the asking price, which hovered between $1 billion and $2 billion, scared off all the potential buyers.

"So what is different for CBS, which announced Thursday that it would pay $1.8 billion for CNet?

"For one, CBS is also a company with well-known brands and sluggish growth." [NYT]

So here's a doozy of a deal: "CBS is acquiring CNET for $1.8 billion in cash. The purchase price comes to $11.50 per share, representing a 44.6 percent premium over last night’s closing price of $7.95. This is that big acquisition we’ve been waiting for from Quincy Smith’s CBS Interactive, and from CNET’s perspective, this avoids the proxy drama with Jana— it appears that this represents a nice profit for them, but the firm, we’re told, has no comment on yet, and is looking into it. The deal was approved unanimously by the CNET board and is expected to close in Q3. [...] Among the sites in the CNET family that will be part of CBS Interactive pending approval: CNET, ZDNet, GameSpot.com, TV.com, mp3.com, CNET news.com, UrbanBaby, CHOW, Search.com, BNET, MySimon and TechRepublic. The company has also been building out its China operations, with sites devoted to womens content and auto." Part of CNET's portfolio is also the domain name "com.com," which means Internet tools who accidentally type in two ".com's" at the end of a web address will send a few pennies CBS's way.

After Hewlett-Packard was found out for illegally monitoring (buzzword alert: pretexting) the investigations of CNet's reporters to expose a media leak, a trio of the website's staffers are suing over invasion of privacy and business practice laws. HP, for its part, offered a "substantial settlement" to avoid litigation. Oh, and they issued personal apologies. [News.com]

• Best Life finds its new publisher at GQ.

• That New York Times is getting awfully lucky with those classified memos.

• Canned ABC News exec producer Shelley Ross won't tell you where she's headed next, but she's "taking meetings." Like Atoosa Rubenstein, Lloyd Grove, Debra Birnbaum, Howard Burns …

• Anna Wintour does as Bee Shaffer tells her.

• Yahoo splitting into three groups with ambigious names.

• Sirius lowers subscriber forecasts by six figures.

• Johnny Apple's funeral at the Kennedy Center last night drew the types of a Tom Brokaw dinner party.

• Rescuers claim to be thisclose to finding missing CNET editor James Kim.

• Jon Friedman pees his pants a little when you start talking about private ownership of newspapers by gajillionaires.

• The sale of Time Inc.'s 18 Time4Media magazines stalls, freaking out staffers who don't know who their new overlord might be.

• This Internet thing is totally going to take off in '07.

• David Letterman reups contract with CBS thru 2010 for a fat $30 million per year.

• Wife and daughters of mission CNET editor James Kim have been found after a week of being stranded in Oregon's wildernes. Kim remains missing after leaving to find help.

• Derek Jeter hits Fox News with a couple Victoria's Secret model to plug his new fragrance. FBNY licks boots of Fox publicist.

• Onetime producer Joseph Medawar gets a year in a day in jail for bilking investors out of millions to produce a never-to-be-made show on DHS.

What the hell is going on around here? Er, actually, what the hell is going on in San Fransisco? Hewlett Packard has infiltrated the San Fran offices of CNET and the Wall Street Journal in an attempt to discover who is leaking stories to the media. Both publications have previously reported on discussion that occurred amongst the board of Hewlett Packard — and HP is not pleased.

The consideration of undercover agents inside news organizations adds a new element to what is known of the Hewlett-Packard investigation, which prominently included the use of subterfuge to gain the phone records of company directors, employees, journalists and others.

One report includes HP's consideration of placing investigators posed as clerical workers and or cleaning staff in offices of CNET and WSJ. So freakin' ridiculous, we don't even know where to begin. Honest, we wouldn't be surprised if, now that the Times has totally blown up their spot, HP decides to send bombshell agents in blue wigs and fuck me boots to pose as secretaries.

Sidenote: Can't you envision CN Portfolio editors clicking champagne glasses and saying "in seven months Eichenwald is ours … ours! Mwahahah.

H.P. Said to Have Studied Infiltrating Newsrooms [Damon Darlin and Kurt Eichenwald]

• Google flipped its rivalry with Yahoo over the sizes of their search indexes into a marketing gimmick, asking users to guess how many billions of pages it's scoured.

• Meanwhile, Google is taking back its one-year blacklist of CNet after a News.com scribe used Google's own search engine to find out information about its execs. Finally they're getting the hang of this PR thing.

• Air America is scrounging for cash, begging listeners to help keep it afloat by donating cash and buying schwag. Embarrassingly, unlike NPR, Air America is a for-profit venture.

• By now, Katie Couric is used to being thrashed in the media, but that won't stop her from showing a little leg.

• Graydon Carter confirmed the widely acknowledged rumors that Tom Ford was brought on board to oversee Vanity Fair's next Hollywood photo spread.

• The average person spends nine hours each day consuming media .. and exactly 15 seconds forgetting about it.