08/07/2008 05:12 am ET Updated May 25, 2011

Fortune , American Express Deny Keith Kelly Report That American Express Has Final Say Over Fortune Small Business Copy

Update: A spokesperson for the Fortune Money Group has denied Keith Kelly's report that American Express will get final say over the editorial content of Fortune Small Business:

Time Inc. has complete editorial control over all of its 120 magazines and 40 websites.

AdAge's Nat Ives also reported the story with no mention that American Express would gain editorial control of the magazine; Ives also correctly pointed out that the 14 editorial staffers whose jobs Keith Kelly claims were axed are actually "up in the air."

"We're sitting down with 14 editors and writers and photo editors," a spokesperson told me. "Everybody's situation is different. We're having them apply for other jobs within Time Inc."

The spokesperson also pointed out that Kelly erred in labeling Dan Goodgame "a 10-year veteran of Time Inc." Goodgame's tenure with Time, Inc. began in 1984 at Time. He has been managing editor of Fortune Small Business since July 2003.

Update: American Express Publishing also denies the facts of Keith Kelly's report, specifically his claim that "Under terms of the early 1990s joint venture, Time Inc. runs editorial on most of the AmEx titles, including Travel & Leisure and Food & Wine, for a flat fee and a split of profits above a certain level."

A spokesperson for the company said that the editorial of American Express Publishing Corporation titles is completely independent from Time Inc., and the Time Inc. doesn't run or oversee editorial on any of their titles. Further, contrary to Kelly's report, there is no flat fee for the arrangement — it is based strictly on a profit split — and American Express Publishing is not a joint venture at all. Rather, it is a wholly owned subsidiary of the American Express Company.

The company's official statement on the American Express Publishing Corporation/Time Inc. relationship is below:

American Express, the parent company of American Express Publishing Corporation, and Time Inc., entered into a management services agreement in 1993. This agreement enables AEP to benefit from Time Inc.'s vast publishing expertise, resources, and relationships, in addition to the already great resources available from American Express.

Original Post: The New York Post's Keith Kelly reports that Fortune Small Business — an advertiser-friendly little sister to the Fortune flagship — has axed 13 of its 17 editorial staffers (that's 76.5 percent of the editorial team, including top dog Dan Goodgame). Buried in the 10th paragraph of the story comes the news that FSB will hand over editorial control of the magazine to American Express, the magazine's main advertiser:

As part of the change, the title's main advertiser, American Express, has final approval over the editorial copy. That contrasts with traditional magazines, in which advertisers have no influence over editorial content.

Kelly writes that the magazine has a long and complex history with American Express and its publishing arm, American Express Publishing:

FSB was run essentially as a custom-published magazine for small business holders of American Express cards, but because it had controlled (in other words, free) circulation of around 1 million, it was considered a lucrative add-on to the main magazine for ad-sales purposes.

The magazine grew out of a complex relationship that Time Inc. carved out years ago with American Express Publishing. FSB was originally known as Your Company.

Under terms of the early 1990s joint venture, Time Inc. runs editorial on most of the AmEx titles, including Travel & Leisure and Food & Wine, for a flat fee and a split of profits above a certain level.

The small business title was the only magazine that was folded into Time Inc. and became part of Fortune.

Read the full article here.