09082013Headline:

Bezos Buys Washington Post

The boss of Amazon, Jeff Bezos, has agreed to purchase the Washington Post newspaper for $250m (£163m). Mr Bezos is buying the paper and its other print properties in a personal capacity.

The Post has been owned by the Graham family for 80 years.

“Years of familiar newspaper-industry challenges made us wonder if there might be another owner who would be better for the Post,” said Post chief executive, Donald Graham. “Jeff Bezos’ proven technology and business genius, his long-term approach and his personal decency make him a uniquely good new owner for the Post.”

The Washington Post Company also owns Kaplan, a test preparation company, in addition to other properties. Those will stay under the ownership of the Grahams as part of a yet-unnamed entity. The sale is expected to be completed in the next 60 days.

The flagship paper, known for its coverage of the Watergate scandal, has suffered in recent years as the internet has hurt advertisement sales and it has struggled to adapt its print coverage to the web.

Jeff Bezos’s latest move helps expand his role as one of the most influential content creators in the United States.

Amazon’s e-book publishing unit recently scored its first million-copy hit when sales of the Hangman’s Daughter series crashed through the seven-figure mark. Last week, Amazon Studios announced five new video-on-demand programme pilots. Meanwhile, its new video games wing is currently advertising for more than a dozen posts.

The Washington Post is different though, as Mr Bezos will personally own the business outright and has said Amazon has no role in the purchase. He has written a memo to the Post’s staff saying he will not lead the paper’s day-to-day operations, but his note was striking for the emphasis he placed on its need to “invent” and “experiment”. Business as usual is clearly not an option.

Industry watchers will also be interested to see how he plans to use his increased political influence. Amazon has recently found itself on the same side as the Justice Department in an e-book competition probe and the Senate in its bill to impose a sales tax on online retailers. How Mr Bezos will act when his interests do not align with government could prove telling.

According to the Alliance for Audited Media, a newspaper auditing firm, the Washington Post was the seventh most popular daily newspaper in the US this year, with a total circulation of 474,767 – a 6.5% decline on last year.

In an open letter posted on the Washington Post’s website, Mr Bezos said he would not be leading the paper on a day-to-day basis and sought to reassure nervous employees, but saying he would not seek to change “the values” of the paper.

Mr Bezos said he did not have a plan yet for what exactly he thought those changes would be.

In a filing with regulators, the company said, however, that Mr Bezos was not purchasing its other notable online properties: Slate magazine, TheRoot.com, and Foreign Policy.

This is the second sale of a major US newspaper in as many days.

Over the weekend, the New York Times announced it had sold another iconic newspaper, the Boston Globe, to John W. Henry, the owner of the baseball team the Boston Red Sox, for $70m – a fraction of the $1.1bn the company had paid for the paper in 1993.

 

 

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