DOTHAN, Ala., August 8, 2013 — Amazon wunderkind Jeff Bezos has purchased the ailing Washington Post newspaper for $250 million using his own personal funds.
That is big news for the news industry, which like the book industry is in a deep malaise over the continuing decline of print.
The delivery cycle may be considerably shorter, but news operations face the same problems as book publishers when it comes to the new digital world.
Most of the media reports so far neglect to mention that the biggest asset Bezos brings to the Washington Post is his expertise in providing value.
Amazon’s amazing success is proof that he understands how to please customers.
To borrow a phrase from The Godfather, Amazon grew because to Bezos, “it’s just business.” Customers have to feel they are getting a good deal or they will go somewhere else. Books are an easily available commodity, so the good deal Amazon offers is cheaper prices, no sales tax and free shipping on larger orders.
That kind of outright capitalism may be considered ugly and unfair by the current political leadership in Washington, but to a customer it is just plain good value.
The question is not whether Bezos will apply the same strategy to selling newspapers, but how he will do it.
The news media has been notoriously liberal and left-leaning in its politics for quite a long time. Bezos is considered liberal and may join the ranks of rich businessmen who get all puffed up making political statements through the media, but to date he has smartly stayed clear of Washington. He obviously has seen The Godfather more than once.
If Bezos stays true to form he will treat his newspaper like a business and not a soapbox from which to preach ideology. Imagine a publisher that focuses more on informing than on politics. What a concept.
News insiders are gushing over with speculation about what Bezos may do with the sagging newspaper. The industry has always been in love with itself and is in shock that one of the elites has seemingly fallen into the hands of an outsider.
Bezos is not a journalist, he sells books! What could a retailer possibly know about running a news operation? How can an outsider save a flagship newspaper like the Washington Post if insiders like the Graham family have given up?
Bezos is not Rupert Murdoch. According to Bezos himself, his immediate plans are to do nothing. David Carr at the New York Times thinks this sale was inevitable considering the decline of print.
For that and other bits of profound wisdom you can buy one of their thin print newspapers for around $2.50, or you can subscribe to their web site for just over $450.00 a year. Ouch.
Despite that masterful bit of digital pricing prestidigitation, the New York Timesstill struggles to stay above water and just dumped The Boston Globe overboard to improve ballast.
CNBC guessed with great authority that Bezos might try to remodel the Washington Post along the lines of Amazon, Netflix or iTunes. Why not along the lines of Disney, or Wonderland or even Playboy?
Of course, using a white rabbit as a logo would be out of the question. CNBC further suggests Bezos may even give away free Kindles to Washington Post subscribers.
Would that mean you could play Space Zombies and read the news at the same time?
The New Republic reported on the Washington Post sale in terms of branding and potential political power. Apparently many on the left are very concerned that Bezos may not contribute any of his billions to their causes like a good media mogul should. Fortune focused on the investment aspects of the sale.
The Los Angeles Times, second only to the New York Times for promoting editorials as hard news, seemed anxious to have a potential ally with deep pockets to help promote liberal causes.
The Guardian speculated that the center of news power is shifting from the east to Silicon Valley. Details about why anyone should care were a bit fuzzy.
Every media outlet that reported on the Washington Post story neglected to point out that journalists are generally not good businessmen, er, business persons, and that can contribute to the red ink on balance sheets.
Journalists are trained to write news stories, sort of, and journalism school curricula focus on everything except how to run a business.
Considering that the path to the top at many newspapers is through the editorial department, it is actually quite amazing that any of them survive. To be fair, the same problem of not having business skills plagues most professionals including doctors and lawyers.
Hopefully, traditional book publishers are watching the news industry carefully, because the primary message for the digital information age is coming through loud and clear: customers want value, not hype.
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