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Could Amazon and Jeff Bezos Make the Washington Post Profitable?

Just a rich man's bauble? I don't think so.

by
Charlie Martin

Bio

August 2, 2013 - 10:03 pm
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The recent announcement of Jeff Bezos’ plan to buy the Washington Post — and just the Post, along with a few other smaller publications, but not the parts of the Washington Post Company that are actually making money, like Kaplan Inc. — has prompted a lot of speculation.

The speculation seems to be based on a simple syllogism: traditional newspapers are no longer capable of making a profit; Bezos bought a traditional newspaper; therefore, Bezos has some other motivation besides making a profit. So, the speculation continues, what could Bezos have in mind? Political leverage? A bail-out of the Grahams? A rich man’s hobby? Or, as Sharon Waxman at Reuters suggested:

He bought it because as an Internet age mogul and a member of the New Establishment, he wanted a platform that would validate him within the Old Establishment.

In other words, as a nouveau riche billionaire, Bezos is buying social respectability, like a car dealer buying a country club membership.

But what if Bezos knows what he’s doing? Let’s see if we can make sense of the purchase as a business, and not merely a billionaire’s bauble.

What does the Washington Post offer? It’s certainly a respectable and respected paper, a reliable voice of the Ruling Class, and still riding on the myth of Watergate power. (One of the repeated warnings to Bezos from naysayers: he’d better not even think of changing that.) It has a reasonable circulation, a good reputation, and a well-established bunch of reporters, along with a massive printing and distribution operation.

Like most big papers, it’s also losing money at a prodigious rate: $22 million in 2011; over $50 million last year.

What does Bezos bring? This has been a puzzle for many; after all, he’s a mere retailer, a tradesman, and while he did attend Princeton, his degree wasn’t in a proper field like political science or history — it was in engineering. What’s more, he doesn’t plan to live in Washington, he apparently doesn’t like cocktail parties, and he declined to be interviewed by his own paper.

All Bezos offers is his ability to make $30 billion by launching a business that has reshaped retail worldwide — and his oft-stated opinion that print will be dead within a few years.

Oh, and one more thing: the dominant e-publishing platform in the Kindle.

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Top Rated Comments   
Coming soon to the online edition of the Washington Post: After every article or editorial will be "Was this editorial helpful to you? Yes/No"
33 weeks ago
33 weeks ago Link To Comment
Amazon Founder Says He Clicked on Washington Post by Mistake

By Andy Borowitz, The New Yorker

09 August 2013

jeff Bezos, the founder of Amazon.com, told reporters today that his reported purchase of the Washington Post was a "gigantic mix-up," explaining that he had clicked on the newspaper by mistake.

"I guess I was just kind of browsing through their website and not paying close attention to what I was doing," he said. "No way did I intend to buy anything."

Mr. Bezos said he had been oblivious to his online shopping error until earlier today, when he saw an unusual charge for two hundred and fifty million dollars on his American Express statement.

After investigating with the credit-card company, he was informed that he had been charged for the purchase price of the entire Washington Post, which, he said, was "pure craziness."

"No way in hell would I buy the Washington Post," he said. "I don't even read the Washington Post."

Mr. Bezos said he had been on the phone with the Post's customer service for the better part of the day trying to unwind his mistaken purchase, but so far "they've really been giving me the runaround."

According to Mr. Bezos, "I keep telling them, I don't know how it got in my cart. I don't want it. It's like they're making it impossible to return it."
33 weeks ago
33 weeks ago Link To Comment
All Comments   (24)
All Comments   (24)
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You didn't address the critical issues: Integrity and trust.

I don't buy a paper for the ads. I buy it to become informed. The Internet doesn't change that. If the paper/site pushes "narrative" instead of giving me reliable information, I'll stop using it.

If Bezos changes that, the Post will thrive. If he doesn't, all the targeted lying in the world won't keep it afloat.

Anyone who thinks differently has my permission to write their disagreement into a letter to the editor of Newsweek.
33 weeks ago
33 weeks ago Link To Comment
Coming soon to the online edition of the Washington Post: After every article or editorial will be "Was this editorial helpful to you? Yes/No"
33 weeks ago
33 weeks ago Link To Comment
Yup. And the next day you'll be offered more articles like that,
33 weeks ago
33 weeks ago Link To Comment
Thoughtful article. I have the same problem as John W above, so I would keep clicking "NO" until there was almost nothing left. I don't do sports or much cultural stuff so that won't make up for the loss of "news."
33 weeks ago
33 weeks ago Link To Comment
I lived in the DC area for many years ands always read the Washington Post. and I wish Bezos the best of luck "saving" it. It already publishes a once a week local paper for each suburb but those suburbs extend farther and farther and grow by leaps and bounds. Bezos may think of a way to improve that coverage. As a lover of books and reading, I never thought I would become an e book addict but I discovered my addiction can be spread to include the newer media Bezos insinuated the new book form into my life and may have something up his sleeve regarding newspapers. I will look forward to seeinf what happens.
33 weeks ago
33 weeks ago Link To Comment
Amazon Founder Says He Clicked on Washington Post by Mistake

By Andy Borowitz, The New Yorker

09 August 2013

jeff Bezos, the founder of Amazon.com, told reporters today that his reported purchase of the Washington Post was a "gigantic mix-up," explaining that he had clicked on the newspaper by mistake.

"I guess I was just kind of browsing through their website and not paying close attention to what I was doing," he said. "No way did I intend to buy anything."

Mr. Bezos said he had been oblivious to his online shopping error until earlier today, when he saw an unusual charge for two hundred and fifty million dollars on his American Express statement.

After investigating with the credit-card company, he was informed that he had been charged for the purchase price of the entire Washington Post, which, he said, was "pure craziness."

"No way in hell would I buy the Washington Post," he said. "I don't even read the Washington Post."

Mr. Bezos said he had been on the phone with the Post's customer service for the better part of the day trying to unwind his mistaken purchase, but so far "they've really been giving me the runaround."

According to Mr. Bezos, "I keep telling them, I don't know how it got in my cart. I don't want it. It's like they're making it impossible to return it."
33 weeks ago
33 weeks ago Link To Comment
Yeah, I liked that one myself.
33 weeks ago
33 weeks ago Link To Comment
"What does Bezos bring? This has been a puzzle for many; after all, he’s a mere retailer, a tradesman, and while he did attend Princeton, his degree wasn’t in a proper field like political science or history — it was in engineering."

Ah, Charlie you obviously didn't get the memo - engineers are perfectly nice chaps and all that, but rather straightforward and analytikal types not expected to be comfortable with the more subtle aspects of irony which is, after all the point of a proper education. I learned to make this distinction in the fall of 1960 during Freshman Week at Columbia College. We all wore those little pale blue beanies with the number 64 in white for when we hoped to graduate. But some of those beanies were different - they said 64E. E for The School of Engineering so no one would mistake one of THEM for one of US and protect us from making the social faux pas of actually talking to someone with an E on his beanie. I mean those people were expected to learn the calculus and goodness knows what else. Our job was to discuss important matters like the role of the Devil in Paradise Lost, so we could serve as an ornament to culture.
33 weeks ago
33 weeks ago Link To Comment
Dude, I get that memo three times a day, usually here in the comments.
33 weeks ago
33 weeks ago Link To Comment
I think that Bezos will unintentionally drag the whole complex towards a liberal pathway that will then drive many away from his product. Amazon is a nonpartisan enterprise and people use it without considering it's founders politics. When the two are combined what will the end product be? If it is seen as biased by a large percentage it will damage both of his products.
33 weeks ago
33 weeks ago Link To Comment
But the business I'm suggesting will force teh WaPo out of the in-the-beltway box. I think it might actually do the opposite.
33 weeks ago
33 weeks ago Link To Comment
the real question is will the editorial content "respond" to the political geography or will it try to convert it. I'd wager the latter with disastrous results. Liberals can't help themselves.
33 weeks ago
33 weeks ago Link To Comment
The problem for Bezos with the Post is in perception and goodwill.

Bezos himself is described as either a soft liberal or libertarian, depending on the issue(s) he's been involved in over the past 15 years. But his company is seen as politically neutral -- Amazon.com isn't viewed by the public as having any political ideology, which means it attracts customers from across the political spectrum.

That non-partisan image could change if Bezos ties the company and its Kindle in too closely with the Washington Post, without changing the angle of the Post's coverage as it exists today (on the editorial pages, the WaPo has been far more even-handed than The New York Times over the past decade, but that's not true of the paper's newsroom, which remains rigidly liberal). Conservative customers hearing about the Post's latest slam on a conservative candidate, or, say Kindle users inundated with fawning Hillary Clinton stories in the run-up to 2016 could easily buy a Nook or just take their business elsewhere if Amazon suddenly is seen as a partisan corporation, in the way most of the nation's biggest newspapers are today.
33 weeks ago
33 weeks ago Link To Comment
Well, notice that Bezos bought WaPo on his own, not via Amazon. And where is the unserved markey in news?
33 weeks ago
33 weeks ago Link To Comment
Bezos is one of those people who is so indelibly tied to his company, that it will be tough for him to keep the WaPo and Amazon separate in people's minds even if they're kept apart in a legal sense.

Apple and Rupert Murdoch tried and failed to create a news portal for tablet readers, so the idea's out there if someone can execute it. The Daily appears to have failed because it's marketing and target audience weren't thought out well enough, but there always would have been the question if liberals would have ever paid for anything Murdoch was associated with, other than "Family Guy" DVDs or "Glee" T-shirts. But Apple never really was touched because News Corp. was the driving force behind the plan, and Apple was just the hardware provider.

Bezos has the potential to be both, so taking the WaPo as is to digital without making it's news coverage more non-partisan is a risk, since the owner of the paper also owns the hardware provider and the major online shopping portal that, as of now, nobody has problems with about their political ideology.
33 weeks ago
33 weeks ago Link To Comment
It would also drive reporting toward stories which attract readers most. This would check and even override "editorial judgment" in story selection.
33 weeks ago
33 weeks ago Link To Comment
I got as far as the Kinde connection - ie that Bezos has led the transition to eBooks with with overwhelming success, but as you point out newspapers are vehicles for advertising, it occurs to me books are vehicles for their content. All I am pointing out is that the business problem is different. Still, I find it hard to believe that Bezos bought the WaPo without him thinking through the problem - so I'm with you: watching for his next move.
33 weeks ago
33 weeks ago Link To Comment
yeah, but advertising certainly isn't completely foreign to Kindle, see the "special offers included" prices.
33 weeks ago
33 weeks ago Link To Comment
Charlie, Wondered about the local news you envision--who is going to report and write that?
33 weeks ago
33 weeks ago Link To Comment
It's a good question. As Igude says, Jeff Jarvis talks about "hyperlocal bloggers", but as Jeff Jarvis is a supercilious self-important prig who takes criticism badly [heh, that may troll up some traffic] I prefer the old-fashioned word "stringer".

Hmmm. Maybe I should write something on the hypothetical Bezos newsroom in flyover country.
33 weeks ago
33 weeks ago Link To Comment
well, I have heard of one idea from Journalism professor Jeff Jarvis - he teaches how to become what he calls hyperlocal bloggers. Think more neighborhood scale. They are already covering areas too small for traditional newspapers and make good money off very local advertisers. It seems to be one of those scale things that change on the Internet like Kindle Singles as a category of publication which were previously forced in the world of print be published as an article, short story etc in a book or in a periodical.
33 weeks ago
33 weeks ago Link To Comment
Observe that super-local ad-supported newspapers seem to be hanging on even on paper.
33 weeks ago
33 weeks ago Link To Comment
What if Bezos' insight into the newspaper business is that local advertisements aren't enough, they need to be local targeted advertisements? If he's going to adjust the news content to each individual it would make sense for him to rework the advertising section including the classifieds.

Wouldn't it be more useful if we could combine the local classifieds of Craigslist with the profiling of Amazon?
33 weeks ago
33 weeks ago Link To Comment
True, true. I'm an avid reader of our small county newspapers. I refused an offer of six weeks' free to sign up for delivery of the big city paper.
33 weeks ago
33 weeks ago Link To Comment
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