In an very surprising and unexpected move, The Washington Post Co. announced late this afternoon that they were selling their flagship newspaper, The Washington Post, to Amazon founder Jeff Bezos, for $250 million.
But times have changed and the Graham family, which has owned the newspaper since 1933, obviously felt that the time was right to sell and that the offer by Bezos was too good to pass up.
The sale of the Post includes its various smaller community newspapers but excludes the valuable headquarters building, which the company has been trying to sell since February. It also includes Kaplan Educational, the troubled for-profit education company that was once a major growth engine for the company.
Last week the Post reported that advertising revenues dropped 4.5% in the second quarter, compared to the same period a year ago, and that daily circulation dropped 7.1% and Sunday circulation dropped 7.6% in the first six months of this year, compared to 2012.
Bezos, who is estimated to be worth $23.3 billion, is buying the newspaper independent of Amazon and is planning to keep the current management in place at the Post. With his deep pockets, Bezos should be able to keep the newspaper running for as long as he pleases.
The sale of the paper leaves the soon to be renamed Washington Post Co. with an odd assortment of businesses, but at the same time removes one of the biggest profit drains from the company.
As for Bezos’ politics, he has given more to Democratic causes, and supported the same-sex marriage amendment in Washington state. With that as a guide, coupled with the fact that he isn’t planning any major personnel changes at the Post, it will almost certainly remain a reliable liberal paper for the foreseeable future.
Bezos issued the following memo to the Post staff:
To the employees of The Washington Post:
You’ll have heard the news, and many of you will greet it with a degree of apprehension. When a single family owns a company for many decades, and when that family acts for all those decades in good faith, in a principled manner, in good times and in rough times, as stewards of important values – when that family has done such a good job – it is only natural to worry about change.
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.
There will of course be change at The Post over the coming years. That’s essential and would have happened with or without new ownership. The Internet is transforming almost every element of the news business: shortening news cycles, eroding long-reliable revenue sources, and enabling new kinds of competition, some of which bear little or no news-gathering costs. There is no map, and charting a path ahead will not be easy. We will need to invent, which means we will need to experiment. Our touchstone will be readers, understanding what they care about – government, local leaders, restaurant openings, scout troops, businesses, charities, governors, sports – and working backwards from there. I’m excited and optimistic about the opportunity for invention.
Journalism plays a critical role in a free society, and The Washington Post — as the hometown paper of the capital city of the United States — is especially important. I would highlight two kinds of courage the Grahams have shown as owners that I hope to channel. The first is the courage to say wait, be sure, slow down, get another source. Real people and their reputations, livelihoods and families are at stake. The second is the courage to say follow the story, no matter the cost. While I hope no one ever threatens to put one of my body parts through a wringer, if they do, thanks to Mrs. Graham’s example, I’ll be ready.
I want to say one last thing that’s really not about the paper or this change in ownership. I have had the great pleasure of getting to know Don very well over the last ten plus years. I do not know a finer man.
With the purchase of the Post, Bezos joins fellow billionaires Warren Buffet and John Henry, who see their ownership as more of a public service. They know as well as anyone that it will be very difficult to make any money from owning newspapers in the near future.