4 Plausible Reasons Bezos Bought Washington Post


In this weirdly bandwidth-deficient edition of The Baer Facts, I talk with Kyle Lacy of ExactTarget about Jeff Bezos (of Amazon.com) purchasing the Washington Post for $250 million, and what the possible motivations for such a seemingly counter-intuitive purchase might be. Note that he bought the company personally, not through Amazon.com.

The Purpose of the Post?

I see four potential reasons for Jeff Bezos to buy the Washington Post:

The Gillette Razor Play
Gillette built a fortune giving away razors to sell blades. I see Bezos doing the same with the Washington Post, and the Kindle. Amazon’s e-reader has been an enormous success in the area of electronic books, but I don’t perceive similar strength in periodicals. I’m sure they’re out there – maybe you – but I don’t know anyone personally who reads newspapers on Kindle routinely. My hunch is that this is the first of many distressed print purchases Bezos will make, and will turn into free subscriptions…..for Kindle users only. Because doing so would rob from Peter (media companies) to pay Paul (Amazon), Bezos made the purchase personally to keep the red ink of the media side from dragging down Amazon’s financials. And as an Amazon shareholder, I appreciate that.

The Bespoke Periodical Play
Amazon knows more about us than just about any company in existence. Sure, Facebook has a colossal amount of data, as does the NSA, evidently. But, other than the big direct mail/database companies like Experion, Amazon has unparalleled insight into not just what we like, but what we buy. Imagine mining that data to create a fully personalized, dynamic newspaper that gives you only the content (and ads) that you’ve indicated you want via years of online behavior. Freaky. And awesome. Freaky awesome, and viable.

The White Knight Play
Perhaps Bezos is making this purchase for cultural rather than business reasons, protecting the tradition and gravitas of the Post from the clutches of other owners who might treat it with less respect and a sharper knife. Given that the venerable Graham family – who have owned the paper forever – sold to Bezos may indicate they are fully on board with his proposed trajectory.

The Kingmaker Play
Evidently, Bezos is quite the libertarian, and his purchase of the Post echoes the playbook of the oft-pilloried Koch Brothers, who tried to purchase the Chicago Tribune and LA Times. Could it be that Bezos is attempting to shift the balance of power in what will surely be a bloody Republican primary for the 2016 Presidential race? Rand Paul as the new darling of the Washington Post? Hmmm.

If I had to wager, I’d go with number one. How about you?

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