Media outlets have been weighing in all week on Amazon founder and CEO Jeff Bezos' $250-million purchase of The Washington Post. Some see Bezos as a billionaire white knight who could reinvent the economics of journalism, others as a potential threat to free speech (after all, Amazon has interests in Washington).
Below, we've rounded up some of the best analyses of the sale (more here), including various interpreted upsides of the purchase, a NY Times look at the Graham family, who have owned the publication for decades (having seen it through Watergate), an open letter in the Style section of the Post to Bezos, and more.
The best news for the ailing news business in a long time is Jeff Bezos’s $250 million purchase of The Washington Post. Those who entertain the knee-jerk reaction that this acquisition of a legacy media operation is simply Bezos laying down dead presidents for “a billionaire’s bauble” are sorely mistaken. The news and information economy desperately needs disrupters and innovators of Steve Jobs-like ambitions, and who else but Bezos fits that description? The Amazon founder wouldn’t have opened his checkbook if he himself didn’t think he was that guy.
The interesting thing, though, is that that the Amazon founder might not actually have to do much backstopping. For all that's been made of the financial troubles at the Post, the newspaper business Bezos just snapped up for a measly (by his standards) $250 million might actually be closer to profitability than many realize.
For each of the last several years, the Washington Post Company's newspaper division, which included several local dailies and online publications like Slate along with the Post itself, has indeed lost millions. In 2012 alone, the division bled $53.7 million, up from $21.2 million in 2011. But much of those "losses" didn't have much to do with the everyday functioning of the publication. Rather, they were due to the arcane (but important) rules of pension accounting (yes, that's right, there are still a few companies outside the auto industry that provide old-school, defined-benefit pensions).
Perhaps the biggest surprise in the sale is that it happened under the watch of Donald Graham. All scions of industry do their time on the shop-room floor, but Mr. Graham had shown that he didn’t want to just inherit his enterprise, he wanted to earn it. He served in Vietnam and later joined the Washington police force to walk a beat before doing his stations in the Post newsroom and on the business side.
He was perhaps not the legend that his mother was, but to many he represented a certain kind of stubborn belief that good newspapering was its own end. In the popular imagination, journalism reached its highest and best calling during Watergate, when The Post and its determined owner, Ms. Graham, took on a sitting president.
The idea that Mr. Graham would sell the paper, whatever merits the sale might entail, seemed as unlikely as Henry V giving up the crown.
But on Monday, Mr. Graham seemed at peace with what he had done.
The Washington Post (open letter to Bezos):
Here's a small detail in the contract for Jeff Bezos buying the Washington Post that should make Post employees feel good for the next twelve months.
Bezos promises not to cut anyone's pay or bonuses, and makes it sound like there won't be job cuts for the next year.
After that, however, it's anyone's guess...
Welcome to The Post. I have read that the $250 million you paid for this newspaper is roughly 1 percent of your net worth, making it about as risky and consequential a purchase for you as a used 2003 Honda Civic might be for me. Still, I hope and strongly suspect you will not see it as a plaything, or, to extend the already shaky metaphor, a vehicle for promoting your bigger enterprises. I am presuming that despite the chump-change numbers, this is a big deal for you...
“Every member of my family started out with the same emotion — shock — in even thinking about” selling The Post, Graham said in an interview Monday. “But when the idea of a transaction with Jeff Bezos came up, it altered my feelings.”
He added: “The Post could have survived under the company’s ownership and been profitable for the foreseeable future. But we wanted to do more than survive. I’m not saying this guarantees success, but it gives us a much greater chance of success.”
Bezos, 49, will take the company private, meaning he will not have to report quarterly earnings to shareholders or be subjected to investors’ demands for ever-rising profits, as the publicly traded Washington Post Co. is obligated to do now.