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WaPo sold to Jeff Bezos of Amazon.com

WaPo sold to Jeff Bezos of Amazon.com

Not a joke.

From WaPo, Washington Post to be sold to Jeff Bezos:

The Washington Post Co. has agreed to sell its flagship newspaper to Amazon.com founder and chief executive Jeffrey P. Bezos, ending the Graham family’s stewardship of one of America’s leading news organizations after four generations.

Bezos, whose entrepreneurship has made him one of the world’s richest men, will pay $250 million in cash for The Post and affiliated publications to the Washington Post Co., which owns the newspaper and other businesses.

Seattle-based Amazon will have no role in the purchase; Bezos himself will buy the news organization and become its sole owner when the sale is completed, probably within 60 days. The Post Co. will change to a new, still-undecided name and continue as a publicly traded company without The Post thereafter.

The deal represents a sudden and stunning turn of events for The Post, Washington’s leading newspaper for decades and a powerful force in shaping the nation’s politics and policy. Few people were aware that a sale was in the works for the paper, whose reporters have broken such stories as the Pentagon Papers, the Watergate scandals and disclosures about the National Security Administration’s surveillance program in May.

For much of the past decade, however, the paper has been unable to escape the financial turmoil that has engulfed newspapers and other “legacy” media organizations. The rise of the Internet and the epochal change from print to digital technology have created a massive wave of competition for traditional news companies, scattering readers and advertisers across a radically altered news and information landscape and triggering mergers, bankruptcies and consolidation among the owners of print and broadcasting properties.

The price? $250 million.

Bezos Letter to Employees:

So, let me start with something critical. The values of The Post do not need changing. The paper’s duty will remain to its readers and not to the private interests of its owners. We will continue to follow the truth wherever it leads, and we’ll work hard not to make mistakes. When we do, we will own up to them quickly and completely.

I won’t be leading The Washington Post day-to-day. I am happily living in “the other Washington” where I have a day job that I love. Besides that, The Post already has an excellent leadership team that knows much more about the news business than I do, and I’m extremely grateful to them for agreeing to stay on.

The sales prices is the same as the Pabst Blue Ribbon brand sold for in 2010 (just saying):

 Pabst Blue Ribbon Sale

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Comments

This sale makes the stock of The New York Times worth about 4 or 5 dollars.

    Not A Member of Any Organized Political in reply to dacama. | August 5, 2013 at 5:37 pm

    WoW!

    Really? That much?

    You didn’t mean $.04 or $.05, 4 or 5 cents or 2 cents worth?

Calypso Facto | August 5, 2013 at 5:00 pm

A Libertarian takes over WaPo. It’ll be interesting to see if the reporting changes for the better.

    GrumpyOne in reply to Calypso Facto. | August 5, 2013 at 7:25 pm

    A libertarian???

    Seems that I heard just recently that Amazon was in bed with the anointed one…

    Fenster314 in reply to Calypso Facto. | August 5, 2013 at 7:49 pm

    Everybody thought Ted Turner was a card carrying conservative until he was denied buying CBS because of it. After that he let loose is true leftness for all to see.

    Obama met with Bezos 5 days before the purchase so I think we can read the handwriting on the wall.

    I am sure the WaPo will renew it’s calls for Internet sales taxes – since Amazon.Com can make a fortune selling tax calculating services across the web.

Wonder what value the Washington Post Co. was carrying the paper on it books. I foresee a huge write-down.

>>…”one of America’s leading news organizations after four generations.”

What a joke. Really. That anybody would say this, or believe it, or that it might even be true. However you parse it, it’s a joke.

Tried to rate dacama’s comment positively. I screwed up. Sorry. And I sooo want the NY Times to go bankrupt. Too bad Wapo didn’t–so far. Sounds like the Grahams are getting out while they can.

    Observer in reply to gabilange. | August 5, 2013 at 5:48 pm

    The irony is that Katherine Graham’s father, Eugene Meyer, originally bought the Post in the early 1930’s in . . . a bankruptcy sale. It only took a few generations to turn it back into a piece of crap.

He wuz robbed! The Boston Globe-Democrat just sold for $70M to Red Sox owner John Henry.

    Calypso Facto in reply to walls. | August 5, 2013 at 5:17 pm

    $70 million AND the former Globe owners kept $110 million in pension liability. So they actually sold for a $40 million transaction loss.

Walls, thought of that too.

Alternate Headline: Jeff Bezos purchases Washington buggy whip factory for 250M.

Good luck with that new toy, buddy.

    Not A Member of Any Organized Political in reply to Redneck Law. | August 5, 2013 at 5:39 pm

    “Gooberment Reports Buggy Whip Sales are Up!”

    – cause of Fed purchases of more buggy whips”

One can always hope that the write-down in the value of the NYT will violate some debt covenants and force it into bankruptcy.

Know what’s weird? My redneck brother-in-law down in Washington, NC just paid $25.00 for some pig manure for his garden.

Which Washington purchase has the greater value?

Bezos didn’t buy the Post to make any money. He already has more money than he could ever spend in a thousand lifetimes.

He bought it because he wants to be a political player. He wants inside-the-Beltway influence–juice.

Whether that’s simply to influence tax legislation issues on behalf of Amazon, or just general expansion of his megalomania, is unknown at this time.

    n.n in reply to Marco100. | August 5, 2013 at 8:45 pm

    That was my thought as well. Amazon has been threatened by this administration, and they would be materially harmed by the expansion of the criteria for nexus, or other regulatory or administrative machinations.

If “the Post already has an excellent leadership team that knows much more about the news business than” Bezos does, how come it’s not making money?

JackRussellTerrierist | August 5, 2013 at 5:43 pm

Bezos isn’t stupid He must have a purpose in making this purchase. Perhaps he clearly understands that the WaPo has too long been an arm of propaganda. His reminder to employees suggests what he’s after: “We will continue to follow the truth wherever it leads, and we’ll work hard not to make mistakes. When we do, we will own up to them quickly and completely.” Obviously, it would have been foolish to start out his relationship with the news staff by chastising them for their libtard reporting, so he reminded them of what American journalism is supposed to be.

    2nd Ammendment Mother in reply to JackRussellTerrierist. | August 5, 2013 at 8:02 pm

    I’m not too worried…. he hasn’t done much with the 165,000 acres he bought east of town in 2005 to build a space port or something…. Branson has alot more activity going on at his Spaceport America east of town.

    I’m thinking that he may find it useful to have media content available easily via kindle downloads. It seems a good fit for someone who is pushing easy read portability. The question is, whether or not he can make it profitable. If nothing else, the WAPO makes a good tax write-off if it fails to perform.

Mark Michael | August 5, 2013 at 5:45 pm

Is there something Bezos has learned creating Amazon.com that he thinks he can apply to the running of WaPo? Something unrelated to its editorial policy or the leftist slant of its news reporting?

Amazon.com seems to do a great job of figuring out what its customers want in the way of books to buy, other stuff to buy, based on past purchases, clicks, whatevers.

Or maybe more efficient management of online operations. Hmm. Maybe they’ll figure out how to use the WaPo subscription base to sell them lots of books or other stuff from Amazon.com.

I’m grasping at straws here, but I’m having a hard time imagining it’s just a Vanity Purchase on Bezos’ part, but maybe that’s all there’s to it. He can watch $250M slowly melt away as WaPo’s readership melts away.

    I’m not so sure you are just grasping for straws. I know that Bezos says he is buying the Post as an individual but think of the potential synergies that might come into play with Amazon.

    Like most papers the Post has suffered over the past years as news/information distribution has moved to the net. Newspapers have historically been geared to local distribution. Larger papers may have regional or even national impact but their actual distribution was likely more to a select customer base in those larger areas. The distribution was to real news consumers. The further from home base the more restricted was the customer base down to the the hard-core news consumers. The migration to net distribution obviously has been difficult due to trying to balance the revenues (advertisement or subscription) to the costs and the massive competition.

    Amazon however has a very wide customer base most of whom are not hard-core news consumers. The strength of the company is its marketing savy via the internet. It may not be that Amazon would want to sell to WaPo customer base but would want to promote/sell WaPo content in some way to Amazon’s extensive customer base. They could slice and dice the content in a variety of ways to enhance other product lines and programs such as Kindle offerings, Amazon Prime, etc.

    It could be Amazon’s way of creating its own content using a highly respected name brand. Their marketing savy could potentially draw new customers directly to WaPo from a much wider base.

The Washington Post has at least made an effort to check facts in its news stories, and to separate fact from opinion.

They have had a nasty habit of trying to spike real stories that were unfavorable to the Democratic Party.

    Insufficiently Sensitive in reply to Valerie. | August 5, 2013 at 9:35 pm

    Both those comments are true, making WaPo a fraction more credible than the NYT. But both those papers were instrumental in ‘shading’ the news in a way to elect one Barack Obama in 2008 and 2012, and to smother much information which would have more honestly informed the voting public on the minuses as well as the pluses of Obama.

    Mr. Bezos is so far a blank slate when it comes to that orientation of the paper, but his statement about continuing on its preset course is not encouraging.

Carol Herman | August 5, 2013 at 5:51 pm

It’s like buying 10 years worth of toilet paper. Where you’d pay less at Amazon. And, the shipping is free.

NC Mountain Girl | August 5, 2013 at 5:57 pm

I have to wonder about the vanity aspect. It seems newspapers may have become the new major league sport franchises.

“says its values won’t change”

WaPo has values?

MaggotAtBroadAndWall | August 5, 2013 at 6:58 pm

Warren Buffett, thru Berkshire Hathaway, has owned WaPo stock and been on its board of directors for several decades. He once bragged that he’d never sell a share of either WaPo or Coca-Cola. It’s interesting that he didn’t want to bid for full control of The Washington Post newspaper, despite having mentioned in his annual letter this year that Berkshire has been on a mini buying binge of very small daily and weekly newspapers serving small markets.

    Buffett has said a lot of things in the past. However, on this one I fully understand why he wouldn’t want to go for full control. It’s much better to be a background player and be able to dump your investment at a moment’s notice than it is to have to rise or fall with the ship.

    Buffett is a magnificent investor for determining value to be seen, but not so great when it comes to redirecting management. Wa-Poo, as I often call it, is in DESPERATE need of a new direction.

    I would not be surprised to see Bezos (quietly and subtly) pick off certain voices within WaPoo and replace them with more saavy, business friendly or Libertarian voices.

    Basically what Bezos has just done is buy himself a readership, where he can now push his ideas onto.

    NC Mountain Girl in reply to MaggotAtBroadAndWall. | August 5, 2013 at 8:51 pm

    Small papers are often in a much better situation than the national papers because they often have little competition for the local news. The only way I have of finding out what is happening in the county, and especially in county government is the county paper. After a couple of years they got smart and took down the free website so its pay for the paper or be in the dark about local news for the only time the closest radio or TV stations cover anything out here it is something truly bizarre. Its ad stream had also held up well because it also may be the only place one can publish certain legal notices. The owners of this paper own a bunch more across the region that are all printed in the same plant.

      Small newspapers have higher ethcical standards than the national papers, at least better than the Washington Post and New York Times.

      Small newspapers almost universally require a person making an accusation of malfeasance against another to be identified in the story. Both the Post and the Times allow anonymous accusations.

Bezos will have a reputable news venue and can take control of the advertising. His brand buying its’ media – like the TV Soaps – which were owned by Proctor & Gamble – now apparently going into social media.

http://daytimeconfidential.zap2it.com/2010/12/09/npr-procter-gamble-ditched-soap-operas-for-social-media

Juba Doobai! | August 5, 2013 at 7:31 pm

I didn’t realize Bezos was naive enough to believe WaPo has values or was interested in the truth.

As the owner Bezos ultimately gets to control the WaPo’s editorial page.

My guess is he intends to use it as his “bully pulpit” for whatever political agenda he might have, maybe short term he stays out of the limelight, but not for long.

Henry Hawkins | August 5, 2013 at 8:06 pm

This is either a vanity purchase or Bezos believes he has a way to transform a dead tree newspaper into a paying online venture where others are failing. Ego or money.

    Third option – Soapbox.

    This gives him an immediate audience, with clout, to pressure this or any future administration to enact policies which favor Bezos. Why? Because it’s being pushed by the Washington Post, that reputable Washington paper of note.

    This is the equivalent of Rupert Murdoch or the Koch Brothers buying the NYT, the LAT or some other Liberal widely read rag and turning it into a stealth mouthpiece.

    Oh, he’ll SAY that the values of the Post “don’t need changing.” My guess is that will last about as long as it takes to find a reason to fire all the senior editors and replace them with more Libertarian leaning individuals.

Stinks of a bailout with private money. Bezos has the cash. WaPo needs cash. WaPo carries water for Obama. Obama taps Bezos. Bezos gets….?

Best response IMHO by Marc Ambiner. He tweeted:

Based on your previous purchases, Jeff Bezos, you might also like:
— The Los Angeles Times
— The Orlando Sentinel
— Newsweek

Amazon sells many things other than books and, as a result, has a good idea of coming trends.

I am guessing they have noticed an uptick in the number of birdcages being sold throughout the Northeast and are positioning themselves to take advantage.

One thought is that some billionaires buy media outlets simply to buy their silence. An example I recall is that Mexican billionaire who bought a stake in the NY Times. After that, I read that the NYT has never written a negative story on him, even though he was in the news for some offenses against antitrust or some violation of regulations in Mexico.

Warren Buffett has uniformly good press, despite obvious political positions that favor his major holdings in Berkshire Hathaway. His life insurance companies benefit from a large national estate tax, for example – encourage people to take out tax-deferred life insurance rather than pay that estate tax to Uncle Sam. Sure enough, Buffett is big on keeping the estate tax. He’s giving his own wealth mostly to the Bill and Melinda Gates Foundation, of course, dodging the estate tax. Ditto a higher personal income tax encourages more tax-deferred insurance company sales. He owns a big chunk of WaPo, as noted above.

Now, what could Bezos be worried about with respect to some kind of government, statist harassment? Well, think about Google and antitrust. Or Apple and antitrust – allegedly “colluding” with a bunch of publishers who price-fixed eBooks to counter Amazon.com.

Hey, there’s Bezo’s company – getting involved with the statists and their various laws and regulations to blackmail successful companies into paying tribute to the Political Class.

Maybe that’s in the back of his mind. Just another thought that just occurred to me.

Hey, at least there’ll be a good return policy.

As Bill Gates found out years ago, successful firms must pay homage to Washington. The Washington Post provides Bezos with a great hedge against an over reaching government.

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