August 6, 2013
Amazon CEO Buys Iconic Washington Post For $250M
Michael Harper for redOrbit.com - Your Universe Online
Billionaire CEO of Amazon.com Jeff Bezos has agreed to buy the Washington Post for $250 million in cash. Bezos, a man closely acquainted with the digital era which has largely been the death knell of print media, says he hopes he can revive the struggling newspaper. He has also purchased the news source as an individual and says Amazon.com will not be affiliated with the paper in any way.Founded in 1877, the Washington Post became a household name following the Nixon Watergate scandal in the 1970s. Post Chairman and CEO Donald Graham said the company, which has been owned by his family for four generations, will be in good hands. Some of the Post's other properties, such as their education division, will not be included in this deal.
In statements given by both parties yesterday, Bezos and Graham said they looked forward to a thriving newspaper in the future as a result of this change of leadership. The newspaper will also be getting a new title, though the exact name has yet to be announced.
"I understand the critical role the Post plays in Washington, DC and our nation, and the Post's values will not change," said Bezos in a statement to Bloomberg.
"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," he added.
Newspapers have been an ailing business in recent years with the explosion of the Internet and particularly since the introduction of smartphones and the tablets. Many organizations which had been responsible for supplying news to their respective communities have folded, including such iconic papers as as the Baltimore Examiner, Cincinnati Post and San Juan Star. Though Bezos' purchase saves the company from a similar fate, some have expressed disapproval of the move.
Outsell Inc analyst Ken Doctor said the Graham family "threw in the towel" by selling to Bezos. Graham's niece, publisher Katharine Weymouth, told readers "This is a day that my family and I never expected to come."
The Washington Post Co. is selling the newspaper it has owned and nurtured for eight decades. Though the move may have been unexpected for Weymouth, she'll continue her role with the newspaper along with several other Washington Post executives. In a statement, Graham said the decision was made by both he and Weymouth along with the board of directors, mentioning the challenges of running a newspaper in today's fast paced society.
"Everyone at the Post Company and everyone in our family has always been proud of The Washington Post - of the newspaper we publish and of the people who write and produce it," said 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."
Wall Street reacted favorably to the news as shares of the Post rose five percent in after-hours trading.
As a part of the agreement, the Post will provide Bezos with $50 million to help cover the costs of employee pensions and other obligations. All monies spent in the deal will go directly to the Washington Post brand rather than the Graham family. Bezos will also buy several other newspapers in the Washington region, including Express newspaper, The Gazette newspapers, Southern Maryland Newspapers, Fairfax County Times, El Tiempo Latino and Greater Washington Publishing.