DMW’s CEO & Publisher provides a wrap-up of the top stories of the week. Who’s hot, who’s not and what’s the industry buzz?

There was no shortage of news for the week of Jan. 21-25. The biggest story: The Federal Reserve lowered the benchmark federal funds rate by three-quarters of a percentage point to 3.5%, its lowest level since September 2005, but the Fed’s actions couldn’t stop an already shaky stock market from continuing its downward spiral. After a sharp mid-week increase on news of the rate cut, the DMW100 ended slightly lower on the week.

• Yahoo (NASD: YHOO) announced that it will lay off "hundreds" from its staff of 14,000 employees as part of a plan to increase profitability and narrow its scope of offerings. Analysis: The market responded favorably to the news of layoffs with Yahoo’s stock ending slightly up on the week, but it doesn’t disguise the fact that the company has serious problems from an analyst perspective, begging the question of whether recent changes in management, product strategy and focus can turn things around. However, with its stock trading at only $21 per share, I wouldn’t rule out a bullish outlook for Yahoo for the long term. While a sluggish economy and competition from Google, Microsoft and social networking sites are big concerns, Yahoo has a worldwide audience of about 500 million users, providing a great opportunity to grow revenue from online advertising. And there’s that rumor that Microsoft may make a bid to purchase Yahoo to compete with Google. As we’ve seen over the years, fortunes can change overnight.

• Shares of Apple (NASD: AAPL) slid nearly 11% on Wednesday after the company said that its second-quarter earnings are likely to be weaker than expected. Analysis: If you listen to our readers, 48% of those responding to our weekly poll are bullish about Apple’s stock, believing the plunge is temporary and now is the time to buy. It’s not hard to believe that Steve Jobs might have more tricks up his sleeve.

• According to a report issued Thursday by the International Federation of the Phonographic Industry (IFPI), global digital music sales leapt 40% in 2007, to $2.9 billion, but declining CD sales pushed the overall market down 10% for the year. The IFPI said that digital music sales now account for 15% of the global music market, up from 11% in 2006 and zero in 2003. Analysis: As many have been predicting for years now, CD sales will continue to drop while digital sales slowly increase, causing the overall market for the sale of recorded music to fall, but if you are expecting radical changes on the part of the majors, think again. To the contrary, as Vivendi Chief Executive Jean-Bernard Levy predicted in his keynote at MidemNet on Saturday, there will be a viable market for physical products like CDs for many years to come and the industry's future will continue to be in finding the right creative talent to make blockbuster hits. Therefore, while it is true that the music industry is going through a major transition, experimenting with new online and mobile business models, don’t expect the majors to jump ship. As we have seen over the last 10 years, there is little urgency among the majors to replace a business as big as CDs with a full-on digital approach. As long as there are buyers, CD sales will continue to represent a big part of their business and likely will for years to come. While the majors are increasing efforts on the digital front, they are still taking a cautious approach when it comes to embracing new digital business models. Will this be the year that they throw in the towel on DRM and fully embrace the MP3 format? There will be a lot more discussion on this topic at Digital Music Forum in New York, February 26-27.

Other interesting news:

• Federal regulators could be on the verge of approving XM Satellite Radio's (NASD: XMSR) merger with rival Sirius (NASD: SIRI).

• Time Warner's (NYSE: TWX) HBO cable TV network announced plans to offer its subscribers free access to some of its movies and original programming online, beginning with a pilot set to launch this week in Wisconsin.

• Comcast will finally begin offering TiVo's (NASD: TIVO) digital video recorder interface to subscribers, initially in the Boston area.

• Meg Whitman, president and CEO of eBay (NASD: EBAY), made it official, saying that she plans to step down on March 31. Whitman will be replaced by John Donahoe, who joined eBay in 2005 following six years as the worldwide managing director of Bain & Company.

• Slide, the provider of an online photo slideshow service, has raised $50 million in a new financing round that values the company at more than $500 million.

• International online social network Badoo, which claims 12.7 million users, announced the launch of a U.S. version of its service and $30 million in funding from Russian investor Finam.

I welcome your feedback and comments, which you can post here or send to editorial@digitalmediawire.com