Here are a few things journalists need to know about The Washington Post sale:
1) It came together quickly. In a video interview, Washington Post Co. chief executive Don Graham said he and Post Publisher Katharine Weymouth sat down “as last year ended” and looked at the Post’s numbers. They decided to look into selling, Graham said, and the investment bank Allen & Co. connected them with Amazon owner Jeff Bezos, with whom Graham said he had conversations in “March or April of this year.” Bezos restated his interest “less than a month ago,” Graham said, and after he and Graham met at Allen & Co.’s annual conference the second week of July, “we quickly reached a deal.”
2) It’s a story that’s making front-page headlines around the country:
3) The price Bezos paid, $250 million, means…something. “The Washington Post’s market cap of $4.2 billion would have suggested a higher price for one of the most distinguished brands in American journalism,” Brent Lang and Sharon Waxman write in The Wrap. “By Don Graham selling this, he’s really started something in terms of devaluing newspapers,” a consultant named Ava Seave tells them.
Still, the Washington Post Co.’s newspaper division lost nearly $50 million in the first two quarters of 2013. That was partly due to accounting moves, but as Graham wrote in his letter to readers: “Our revenues had declined seven years in a row. We had innovated, and to my critical eye our innovations had been quite successful in audience and in quality, but they hadn’t made up for the revenue decline.”
The Boston Globe, which in September 2012 had a little more than half the Post’s Sunday circulation and a little less than half its weekday circulation, sold for $70 million Saturday.
In an email, Poynter’s Rick Edmonds wrote that Bezos, who bought the paper for cash, on his own and not as part of Amazon.com, can outlast a digital transformation that may “entail poor profits and big investments in transformation for years to come — three, five, ten.”
He continued: “A public company — the Washington Post Co. or the New York Times Co — cannot justify that same level of patience and investment.” Here’s more from Edmonds, in an interview with Marketplace:
4) It’s a huge cultural moment — perhaps even if you’re not employed in the media. Herewith, a by-no-means comprehensive and unlikely-to-be-updated survey of the innumerable pieces about the deal published in the last 24 hours.
“The Washington Post has been a source of both constancy and coverage, a center of gravity and a force in the civic, social and cultural life of a city where many others came and went,” David Carr writes in The New York Times.
“So let us hope that this is what the sale signifies: the beginning of a phase in which this Gilded Age’s major beneficiaries re-invest in the infrastructure of our public intelligence,” James Fallows writes in The Atlantic.
“[I]t is hard to understate the implications of the current owners crying uncle,” Politico Editor-in-Chief John Harris writes. “Over the decades, no newspaper owners have been more conscientious than the Graham family in balancing the imperatives of first-class journalism with a first-class business. At a time when many news organizations were crippled by the whims or vanities of weak or greedy owners, few journalists at the Post ever doubted that the judgment and values of the owners were fundamentally sound.”
“In acquiring the Washington Post, Bezos enters a business that is not radically different from the ones he already owns,” Jack Shafer writes. “Reporters and editors like to think their literary arts are central to newspapering. But it’s better to think of a newspaper as a coordination problem that manufacturing and distribution solves daily: Copy, art, and advertising is beamed from newsroom to printing plant, bundled newspapers flow from the plant to trucks, are transferred to carriers, and are delivered to your front door.”
“Even more interesting, perhaps, is the transmission of west coast wealth to the crisis-torn content economy of old-fashioned east coast influence factories,” Emily Bell writes. “The cultural divide between the thought processes of the engineering-oriented Silicon Valley and the words-based elites of the East, in politics and media, is vast. The low esteem in which each holds the other is often breathtaking to observe.”
“I have one fear of Bezos: his secrecy,” Jeff Jarvis writes. “A news organization must be open (there I’m a disciple of the Guardian’s Alan Rusbridger). I also want to see innovation and experimentation at the Post done in the open so the rest of the industry can benefit from it. Then perhaps Bezos can save more than one newspaper.”
“The real story is about the journalism, not just today, but in the weeks, years ahead,” Poynter President Karen Dunlap said in an email. “We share in the shock and sadness at the sale of a great, family-owned news organization. We celebrate Jeff Bezos’ willingness to invest in an outstanding news company and to keep the leadership team in place. The real measure of the sale will be seen in the quality of journalism under a new owner.”
5) It’s the end of an era. From former Post Executive Editor Marcus Brauchli’s Instagram account: “End of an Era: The Graham family–Don, Amanda Bennett, Laura, Tim O’Shaughnessy, Will–leave the company auditorium Monday after the announcement that The Post will be sold,” he writes in its caption. “A brave, selfless act, as hard as any, done with dignity and loyalty.”
Correction: This post originally referred to Katharine Weymouth as Katharine Graham.