It is a deal that seems to perfect illustrate the changing times as Reed Elsevier sells off Hollywood institution Variety to blog firm Penske Media, which owns Deadline.com, in a deal valued at $25m.

The deal to sell the 107 year-old Hollywood institution is being described as a fire sale and has been a long time coming.

One of the first things that new owner Penske Media said it planned to do is to ditch Variety’s paywall.

Reed had tried to sell Variety in four years ago as part of a larger deal, but abandoned the sale.

The delay in finding a buyer has almost certainly resulted in Reed Elsevier losing millions.

It is understood that the price being asked for Variety dropped from an initial $40m to a fire sale figure of $25m to get the deal done. The sale gives Penske Media, backed by the Third Point hedge fund, control of the weekly Variety,  Daily Variety and Variety.com.

Penske says that Variety will survive in print, but it is unclear if that includes the daily print edition. Rival the Hollywood reporter ditched its daily print edition two years ago. Penske also said that it plans to keep the Variety brands separate.

“We plan to rapidly build upon Variety’s foundation while extending this invaluable brand’s presence across the Web, broadcast, mobile and international markets,” said Penske Media chief executive Jay Penske in a statement announcing the deal.

Variety’s decline is in part connected with the success of sites like Deadline.com, which Penske bought in 2009.

Deadline is run by veteran Hollywood journalist and blogger Nikki Finke who has been called the “most feared, despised, and uncompromising journalist in Hollywood” as well as one of the most respected.

Her success, as Emily Bell put it in the Guardian today, is down in part to how she took advantage of the changing media landscape, the rise of blogs and the decline of print, better than her competitors.  That netted her $14m when she sold Deadline to Penske:

“She (Finke) worked harder, wrote more, and fitted the medium better than her competitors. Detractors point out that she has also ditched some of the conventions of print, for example by using anonymous sources, mending the archives to better reflect facts, and, being partial rather than neutral (her coverage of the 2007-8 Hollywood writers’ strike was undisguisedly on the side of the writers),” Bell wrote.

The paywall numbers speak for themselves. The paywalled Variety site has 17,000 subscribers and 397,000 unique monthly readers. According to comScore this is how rivals stack-up: TheWrap.com has 775,000 Deadline 1.89 million the Hollywood Reporter 5.1 million for.

According to the WSJ the sales price is lower than the $30m in annual earnings Variety was generating as recently as 2007. This year it is expected to reach $6m or less.