Jeff Bezos will need more than money at The Post
The paper of record in Washington, DC, made some bad moves years ago that could prove very hard to overcome anytime soon.
The Post, unfortunately, has been slow to grasp the idea that people will pay for content they think is worth the money. The company's rivals at The New York Times (NYT) instituted a paywall in 2011. Executives at the Post didn't follow suit until June of this year.
But two years in the Internet world is an eternity. As a result of moving earlier, The Times is in far better financial shape than The Post. It earned more than $20 million in the latest quarter, while the Post's newspaper publishing business had an operating loss of $14.8 million.
Many pundits have also noted that The Post has lost its place as the paper of record for the D.C. establishment to Politico, which was founded by two former Post reporters, John Harris and Jim VandeHei. New York Times columnist Ross Douthat noted recently that "Politico has claimed a big part of the audience that The Post needed in order to thrive in the world the Internet has made."
Again, this is a problem that money alone can't solve.
Bezos, however, described himself as a "genetic optimist" in an interview with The Post, which certainly is going to help the newspaper. He also stressed that he had no quick fixes for what ails the venerable publication. No doubt, Bezos will bring new ideas to an industry that desperately needs them.
But what's getting lost in mostly fawning coverage of this transaction is the simple fact that Bezos is a businessman. He's going to expect a return on his investment ... eventually. Taking a newspaper company out of the prying hands of the stock market is no guarantee of success. Just look at the Philadelphia Inquirer.
For years, the paper was considered one of the crown jewels of the Knight-Ridder chain. When that company hit hard times, it sold the Inquirer, its sister paper the Philadelphia Daily News and related Web properties in 2006 for $515 million to a group of investors led by local public relations executive Brian Tierney.
Four years later, creditors assumed control of the papers after the company fell into debt. The properties were sold to another group of local investors last year for about $55 million. Along the way, there have been newsroom layoffs even as the company continued to produce good journalism.
Bezos has deeper pockets than the buyers of the Inquirer, but he can't protect The Post from the hardships that the paper and other metro dailies are facing. The road to Bezos's "golden era" won't be easy.
Jonathan Berr does not own shares of the listed stocks. Follow him on Twitter @jdberr.
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