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Originally Posted by SteveEisenberg
I can't believe Bezos is dumb enough to think that the Washington Post is a good investment.
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Time will tell, but the "wise man of Omaha" has been buying newspapers left and right. I don't think many people would dare call Buffet dumb.
Bezos is enough of a contrarian that he might indeed see a good investment where others see unending losses. He has enough of a track record that I woudn't bet against him.
http://www.washingtonpost.com/blogs/...at-that-means/
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Media economics have, of course reversed. Now the great constraint is not on the ability to deliver information, but on the capacity of readers to consume it. Every media organization competes with every other one, and the cost of information is something very nearly free.
The winners in this new world of media economics, if there are any, will be those who are willing to take big financial risks, and endure the possibility that those risks won’t pay off for years, if ever. It is the kind of patience that public companies that report earnings every three months do not have.
Jeff Bezos, with an estimated $25 billion net worth, can afford to be patient, and has demonstrated it year after year in his stewardship of Amazon, which reports terrible profit numbers as it plows money into investing for the future. We at the Washington Post can only hope that has the same inclination, and entrepreneurial juice, as he becomes our boss.
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The case can be made that there is unrealized potential in his new property:
http://www.washingtonpost.com/blogs/...or-jeff-bezos/
Similarly, the case can be made that Bezos really intends to let the WP be:
http://www.washingtonpost.com/blogs/...m_business_pop
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There’s a whole constellation of retail sites that Amazon has bought and essentially allowed to continue operating as is, with little to no Amazon branding, and sometimes even with overlapping and competitive business models. Case in point: Zappos.com, which founder Tony Hsieh has run almost completely independently since Amazon purchased the shoe marketplace in 2009 (though they’ve since found some efficiencies through merging warehouses). There’s also Shopbop, which is evolving on its own to sell designer clothes, Quidsi’s Daipers.com, the cloth store Fabric.com, and the digital photography review site dpreview.com. And then there’s Brilliance Audio, which seems to overlap both with Amazon Publishing and Audible.com, another recent purchase that’s building its own partnerships.
So what’s the strategy here? Amazon could want these properties just to keep them out of other big companies’ hands, or it could believe that they’ll innovate better with their original founders. Finally, it may figure there are communities that will identify more with the “independent” brands than Amazon itself.
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Like so many of Bezos' moves at Amazon (selling fine art online?!) his purchase of the WP is initially confounding but so far he has been right more often than not.
It is going to be interesting to see where this move takes him and the WP.