The Media Unspun weblog is open! Visit us at http://www.mediaunspun.com/weblog.html

Media Unspun serves business news and analysis, authoritatively, irreverently, and independently, every business day. An annual subscription costs $50, less than a dollar a week. If your four-week free trial is coming to an end soon, please visit http://www.mediaunspun.com/subscribe.html and sign up via credit card or check.

Delta has a new plan for survival, and no, it's not more layoffs. This time, Delta is launching a budget airline a la Southwest, JetBlue, and AirTran, causing both CBS MarketWatch and TheStreet.com to remark, "If you can't beat 'em, join 'em."

Trouble is, Delta already joined 'em in 1996, when it launched its low-cost, soon-to-be-eliminated Delta Express subsidiary. The new, unnamed airline will start by flying routes Delta Express already serves: New York and Boston to Florida. "Perhaps the new one could be named 'Delta Really Really (We Mean It This Time) Express,'" suggested the Motley Fool.

Surely there must be some differences? The big ones are that the new airline will use 757s instead of smaller 737s and will replace first class with more coach seats. Also, customers will be encouraged to use online ticketing and other employee-free methods to improve efficiency, and each flight will have fewer flight attendants. "People had this edge of skepticism that Delta Express was just something that was part of Delta," said execs, so expect a name change, too. We're not sure what else to expect, because so much of the announcement was cloaked in buzzword-laden mumbo jumbo. The new airline will have a distinctive "culture" and "look," for example. And Delta President Fred Reid actually said, in a conference call, "We will leverage and coordinate all of Delta's competitive advantages in a holistic fashion." Um, yeah.

There's no telling whether this desperate rebranding will even work. Other low-cost carriers like US Airways' Metrojet and Continental's Cal Lite lost money, said the Boston Globe. Some observers thought the new budget airline wouldn't have cheap enough operating costs. "Conspicuously missing from Delta's plan is lower pay for its pilots," said the Wall Street Journal, citing an analyst who said senior 757 captains earn about $245 an hour, compared with $145 at Southwest. Don't get too jealous of those high-paid pilots yet. They'll be making $0 an hour if Delta's "new" airline doesn't work. - Jen Muehlbauer

Delta's low-cost airline makes stir (CBS Marketwatch)
http://tinyurl.com/2w43

Delta's Hail Mary
http://www.fool.com/News/Take/2002/mft/mft02112004.htm

Delta to launch new low-fare carrier next year
http://www.accessatlanta.com/ajc/business/delta/1102/20newdelta.html

Delta Air Lines to start low-cost carrier (Boston Globe)
http://tinyurl.com/2w42

Delta's plans for low-fare service offer hope for bleak Boeing market
http://seattlepi.nwsource.com/business/96542_delta21.shtml

Delta shares few details of plan for low-fare unit
http://www.usatoday.com/travel/news/2002/2002-11-21-delta-follow.htm

Delta Targets Low-Cost Rivals
http://www.thestreet.com/funds/ericgillin/10055272.html

Delta Air Unveils Plans For a Low-Fare Carrier
http://online.wsj.com/article/0,,SB1037800253687495028,00.html
(Paid subscription required.)

Cryptic businesses are out. The media used to gloss over byzantine business plans as "complex transactions." If it was hard to understand, it was brilliant. But a cast of corporate henchmen -- and we suspect we don't need to name names here -- has taught us that if it's hard to understand how a company makes money, that's probably because it's doing so illegally.

Enter National Century Financial Services, a company with one of those bland sorts of names that must have been ordered from a catalog. The health care financing company filed for bankruptcy on Monday, but the FBI had already raided its premises on Saturday. What keeps National Century from being a been-there, read-that story of an overly complex business? According to reporters now examining its remains, National Century has several claims to fame: It's dragging a waiting room's worth of clients into bankruptcy with it, it's striking hard at providers of health-care services in poor neighborhoods, and the big losers, for a change, are big investors.

Here's an explanation, courtesy of the New York Times, of how National Century made money. It lent cash to health care companies in return for taking over rights to their receivables. It then packaged the receivables -- payments due from insurers and government programs -- into collateral for bonds and sold the bonds to investors. It earned a fee for each subsequent insurance payment.

Trouble is, National Century was short on the money to back the bonds, according to the Wall Street Journal. Credit Suisse First Boston, already in a peck of trouble, peddled $2 billion worth of bonds to investors. Now more than $300 million is missing from a reserve fund set aside for one $3.35 billion bond issue. Several health care organizations that contracted with National Century have gone belly-up in the last few days, including Doctors Community Healthcare, which owns five hospitals in low-income neighborhoods and filed Chapter 11 yesterday.

The Columbus Dispatch, reporting from National Century's home turf, reported the FBI raid on Sunday and follows today with a profile of National Century and its disgraced CEO, Lance Poulsen, who resigned Nov. 8. The Dispatch ticks off Poulsen's typical fat-cat accoutrements: fabulous home, expensive toys, and generosity in local philanthropy. It also scored with an interview with one of the 200 employees who've been laid off. "I'm glad to be out of there," the Dispatch quoted one former worker as saying. "I don't have the weight on me of working for a company that is so greedy that it would endanger the lives of patients who live in nursing homes." It could be worse: We could be patients. - Deborah Asbrand

Fallout Spreads After Collapse of a Health Services Lender
http://www.nytimes.com/2002/11/21/business/21CARE.html

National Century Troubles Surfaced Three Years Ago
http://online.wsj.com/article/0,,SB1037839973762833268,00.html
(Paid subscription required.)

Filing Betrays Arcane Financing
http://www.washingtonpost.com/wp-dyn/articles/A17643-2002Nov20.html

FBI Raids Medical Lender's Offices (Columbus Dispatch)
http://tinyurl.com/2w49

National Century Still A Puzzle (Columbus Dispatch)
http://tinyurl.com/2w2z

National Century fall hits creditors (Cleveland Plain Dealer)
http://tinyurl.com/2w2q

Boeing to cut 5,000 more
http://seattlepi.nwsource.com/business/96592_boeingjobs21.shtml

HP posts strong earnings
http://www.bayarea.com/mld/mercurynews/business/4570794.htm

Reuters Cuts 50 Editorial Staff As Revenue Declines
http://news.independent.co.uk/business/news/story.jsp?story=354155

Giddy WorldCom workers greet CEO (Denver Post)
http://tinyurl.com/2w4c

Benefits to end for many jobless (Rocky Mountain News)
http://tinyurl.com/2w4b

Modern-Day Proust E-Mails Friend Six Times A Day
http://www.theonion.com/onion3843/modern-day_proust.html

UBS Closing Trading Floor It Acquired From Enron
http://www.nytimes.com/2002/11/21/business/21ENER.html

Salon: Watch ad, read articles for free
http://news.com.com/2100-1023-966664.html

Rudy Can't Fail
http://slate.msn.com/?id=2074274

Free Web Research Link Closed Under Pressure From Pay Sites
http://www.washingtonpost.com/wp-dyn/articles/A17568-2002Nov20.html

Internet Sites Delete News of Sales by Big Retailers
http://www.nytimes.com/2002/11/21/technology/21COPY.html

Copyedited by Jim Duffy (jimduffy86@yahoo.com).

Editor and publisher: Jimmy Guterman (guterman@vineyard.com).

Media Unspun is produced by The Vineyard Group Inc.
Copyright 2002 Media Unspun, Inc., and The Vineyard Group, Inc.
Subscribe already, willya? http://www.mediaunspun.com