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Copyright 2016 NPR. To see more, visit http://www.npr.org/.

Copyright 2016 NPR. To see more, visit http://www.npr.org/.

Copyright 2016 NPR. To see more, visit http://www.npr.org/.

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Jeff Bezos To Buy 'Washington Post' From Graham Family

Aug 6, 2013
Originally published on August 7, 2013 1:21 pm

Transcript

RENEE MONTAGNE, HOST:

This is MORNING EDITION, from NPR News. I'm Renee Montagne.

LINDA WERTHEIMER, HOST:

And I'm Linda Wertheimer. This morning, The Washington Post is in its own headlines. The Graham family, which controlled the Post for eight decades, is selling the flagship paper. Here's Washington Post Chairman Donald Graham, in a Post-TV video talking about the sale.

(SOUNDBITE OF POST-TV VIDEO)

DONALD GRAHAM: We knew we could keep the Post alive. We knew it could survive. But our aspirations for the Post have always been higher by that. So we went to see if we could find a buyer who would do a fair deal with The Washington Post Co. for our shareholders, but also have - open the possibility for a better future for the Post.

WERTHEIMER: The sale of the Post, of course, is news, but it's the buyer who shocked many people. And that's Jeff Bezos, the founder of the online retail giant Amazon. In a moment, we'll hear more about what might have spurred his interest in the news business.

But first, let's turn to NPR media correspondent David Folkenflik, to learn more about the deal. Good morning, David.

DAVID FOLKENFLIK, BYLINE: Good morning, Linda.

WERTHEIMER: So what's in this deal?

FOLKENFLIK: So the deal plays out like this: Bezos is paying about $250 million in cash for The Washington Post and a bunch of smaller publications - some suburban papers, a Latino-oriented publication in Washington, one geared for younger readers. What he's not getting is the rest of the properties. The Washington Post Co. owns also television stations, the Kaplan educational division that brought in a lot of profits for a lot of years. Those will be controlled by what will be a renamed company that is publicly traded, but largely controlled by the Graham family.

WERTHEIMER: It's interesting, don't you think, that in the old days, you bought a newspaper to become a millionaire. Now, you have to be a millionaire to own a newspaper.

FOLKENFLIK: Be a billionaire, in some ways.

WERTHEIMER: Say a billionaire. Right.

(LAUGHTER)

FOLKENFLIK: Although, I got to tell you, a lot of papers are moving for what you'd consider bargain-basement prices. You know, $250 million is a lot of money to you and me. But when you consider what newspapers used to go for, it's really a modest, modest amount. What people do acquire is stature. They acquire a sense of a place in the community. In Bezos' case, because he's acquiring The Washington Post and of its journalistic heritage, you know, he's acquiring a place at the national table as well.

WERTHEIMER: Now, Amazon is a huge, huge company. Presumably, there are some conflicts coming along with his purchase of the Post. What about other interests that Bezos owns?

FOLKENFLIK: Well, there's an enormous constellation of issues that arise before the federal agencies and Congress, that Bezos has a direct stake in. He's also starting to become a major vendor to the United States government. He's got this Amazon cloud service. You know, the idea is that government agencies can store very sensitive information online in the cloud. And, you know, if it's storing - for argument's sake - information for an intelligence agency, and The Washington Post wants to break stories on that, will that be a conflict? I suspect Bezos doesn't intend to interfere in things like that, but we don't know how he's going to do it yet. We haven't seen him operate in this realm.

Similarly, you think of the book-selling industry. You think of intellectual property issues, questions of Internet taxation. These are all things in which a company like Amazon would take not only an active interest, but a leading one. He's going to have to navigate those shoals, in some ways. You know, he said that he intends to preserve the integrity of the Post; and keep on Katharine Weymouth as the publisher, and keep on Marty Baron, the new executive editor, as the top guy in the newsroom at the Post. So he says, you know, we want to continue on the course, with the same values that have guided the Post in the years before.

WERTHEIMER: Now, we heard in that tape that Donnie Graham said this would be good for the Post. Do you have any other insight as to why they felt they were compelled to do this now?

FOLKENFLIK: You've seen a steep and precipitous decline in revenues, and particularly in circulation. They hadn't figured out how to really make money on the digital side, in the way they had hoped. And they hadn't solved the riddles. Don Graham - you could hear in his voice, there's sadness to this. He's, after all, you know, the son of the famous Kay Graham and Phil Graham, who had been these great publishers who had led the Post to prominence. You think of stories like the Pentagon Papers, Watergate - these are all stories where The Washington Post led the nation's understanding, the world's understanding of some major issues. I think they were fearful of having to report on their own demise; hence, the headlines we see this morning.

WERTHEIMER: David, what do you think this says about legacy news organizations, about families like the Grahams that have owned a paper for a very long time? They didn't sell it to a Washington stakeholder. They didn't sell it to somebody in journalism.

FOLKENFLIK: Well, I think you see, in some ways, a recognition that the folks in legacy journalism haven't had answers. And for Don Graham to turn and sell to some other major family or entity in Washington might not do the trick. Jeff Bezos is a guy who's really reshaped what we understand for the book-selling industry, but also for online commerce. He's redefined it. He's shown that he's willing, in some ways, to accept profit margins, at times a bit of loss in the e-book industry.

And also, Don Graham is particularly interested in what Silicon Valley and digital innovators can do in the landscape of not only new media, but I think what we tend to think of as old media. I think he's looking to a guy like Bezos to say - you know - look, we had our shot. We did our best. We worked hard. We spent a lot of money doing it. We forewent a lot of profits doing it, but we haven't figured this out. We haven't found our way out of the maze. We've done our best. Now, it's your shot.

WERTHEIMER: NPR's media correspondent, David Folkenflik. David, thank you.

FOLKENFLIK: You bet. Transcript provided by NPR, Copyright NPR.