To be clear, he didn’t buy the whole company — WPO the corporate entity still owns educational services division Kaplan, as well as other media outlets including Slate and Foreign Policy. And this is Jeff Bezos the citizen buying the Washington Post, not Amazon.com making a buyout that has anything to do with the Kindle or e-books or whatever.
But it’s a heck of a headline, isn’t it?
Many people might wonder why in the world Jeff Bezos bought the Washington Post, a struggling newspaper, albeit one with a storied history.
Well, perhaps it’s no different than Warren Buffett diving into newspapers via BH Media, the newspaper division of Omaha-based Berkshire Hathaway (BRK.B). These investments aren’t sexy, but they can be very lucrative for patient businessmen willing to maximize the potential in private instead of slashing and burning under public ownership and the scrutiny of shareholders.
Or perhaps it’s something greater. After all, Buffett has made no secret about his affection for newspapers and the obligations they serve in communities. Perhaps selling the Washington Post to Jeff Bezos puts an altruistic person at the helm as well as an entrepreneur.
Here’s what the Washington Post itself had to say about the Bezos buyout:
Bezos, in an interview, called The Post “an important institution” and expressed optimism about its future. “I don’t want to imply that I have a worked-out plan,” he said. “This will be uncharted terrain and it will require experimentation.”
He said, “There would be change with or without new ownership. But the key thing I hope people will take away from this is that the values of The Post do not need changing. The duty of the paper is to the readers, not the owners.”
That could be posturing for PR. But it could be true, too.
Remember, Bezos invested in digital media property Business Insider and the organization had no trouble adding journalists and coverage rather than reducing output and squeezing out higher profits just to pay back backers.
It’s a strange day for the Graham family, which has maintained control of the newspaper for four generations. It’s also a strange feeling for Gannett (GCI) and The New York Times Co. (NYT), surely, which have enough troubles adapting to a digital age without the drama of a high-profile tech entrepreneur taking over a high-profile competitor in the marketplace of truly national newspapers.
It’s also not encouraging to some that Bezos has made comments essentially predicting people won’t pay for online content (ad supported sites only, in other words) and that print will be dead soon. But frankly neither of those comments are particularly shocking or insightful. It’s the way of digital media, and few know it better than Bezos.
Change is hard, and I think the readers and staff of the Post will win out in the long run here. Because while the print version may ultimately die and pay walls are hard to pull off, that does not mean quality journalism has to struggle and die with them.
I, for one, am excited to see how Jeff Bezos can take the creativity he put into Amazon.com and use it foster one of the nation’s greatest newsrooms in a digital age.
- The news on the paper’s website. (Washington Post)
- Why Buffett believes in the future of newspapers. (Roanoke Times)
- BTW, the New York Times is making $360 million in digital revenue … so maybe newspapers don’t need print to survive. (Business Insider)
- Or maybe Henry Blodget is dead wrong. (InvestorPlace.com)
- In other media news, the Boston Globe was sold in the past week, too. (Poynter Institute)
Jeff Reeves is the editor of InvestorPlace.com and the author of The Frugal Investor’s Guide to Finding Great Stocks. Write him at firstname.lastname@example.org or follow him on Twitter at @JeffReevesIP. As of this writing, he did not own a position in any of the stocks named here.