It’s hard to startle the journalism business these days, given the scale and speed of disruption of the media industry. But the Graham family selling The Washington Post to Amazon CEO Jeff Bezos for $250 million is an exception. Few newspapers in the world are as closely identified with a single family. The story of the Grahams and The Post used to be told in giant pictures on the wall of the newspaper lobby on L Street not far from the White House. One grainy photograph documented the day in 1933 when the brilliant financier Eugene Meyer bought the paper for a song at a bankruptcy sale on the courthouse steps. Another (a favorite of all of us who worked there) showed Meyer’s remarkable daughter, Katharine Graham, beaming as she left another D.C. courthouse in the company of her favorite editor, Benjamin C. Bradlee, after they prevailed over the government in the Pentagon Papers lawsuit.
Why The Washington Post Isn’t A Charity Case For Jeff Bezos
Based on his comments in the interview Friday, Bezos appears unlikely to make any major decisions or pronouncements during his visit or propose any immediate changes. He said he is eager to meet with and listen to managers and learn about the news organization’s operations. The Post is the first newspaper that Bezos has owned and will be operated as a stand-alone business, independent of Amazon. Bezos intends to keep his “day job” as chairman and chief executive of Amazon and will continue living in Seattle, where the company is based. Bezos is one of the world’s richest men, with a net worth of around $24 billion, based on the current value of his Amazon stock holdings. His deep pockets, technological savvy and reputation as a long-term strategic thinker were among the attributes that Post Co. chief executive Donald E. Graham cited in selling him The Post after 80 years under the Graham family’s control. Graham said he saw no alternative to continued investment, which would be difficult for a publicly traded company.
But there is an even bigger question looming than the name, and that’s who will succeed Graham. In five years, he will be the age of his mother, Katharine Graham, when she stepped down from the chief executive post in 1991 and handed the reins to her son. There are no obvious choices to outside observers. Katharine Weymouth — The Post’s publisher and Graham’s niece — is leaving the company to continue running the paper for Bezos, though she remains a member of the board. Graham’s daughter Laura Graham O’Shaughnessy runs SocialCode, which nearly doubled its revenue last year but remains a small part of the company. Then there is Andy Rosen, who has run Kaplan since 2008. He is not a member of the family but is deeply respected by Graham.
On April 4, Donald E. Graham sat for a videotaped interview about how the Internet and digital technology had hammered and transformed the news business. Cradling a coffee cup emblazoned with the word “Washington,” Graham sat next to his desk, with three Herblock cartoons on the wall behind him and a photo of a young Warren Buffett on the table next to him. Graham gave a classic performance, telling stories of bygone times in his disarming aw-shucks manner, dispensing compliments to colleagues and rivals while mixing in his sober, analytical view about the reporting-intensive newspaper business — and his failure to come up with a way to sustain it. “One of the questions that faces places like the [New York] Times and The Post is: Is there any kind of a plus to a news organization in having really high-quality reporting and editing?” he said at one point. “I’m pretty sure the answer to that is yes, but we have not figured it out.” He added, “If somebody said to me there’s a way out for newspapers, but you’re going to have to lose $100 million a year to get there four to five years from now, I would sign up for it in a minute.”
But no one said that to him and unbeknownst to the three veteran journalists interviewing him that day for Riptide, a journalism history project at Harvard University’s Shorenstein center, Graham was trying to figure his own way out — of the daily newspaper business. Quietly, he was shopping around for a buyer, one without a political agenda but also one with a sense of stewardship about the paper — and pockets deep enough to buy the franchise and cover losses if necessary. Amazon founder and chief executive Jeffrey P. Bezos ultimately agreed to buy the paper himself for $250 million, also acquiring El Tiempo, Express, the local Gazettes, and Robinson Terminal, including Robinson’s 23 acres of undeveloped land in Charles County, Md.
Washington Post owner Jeff Bezos has absorbed the responsibility—much of it critical—for not keeping Ezra Klein and his proposed new digital-media venture at the Post. How could Bezos, the digital entrepreneur who created Amazon.com, not buy into Klein’s vision of a website devoted to delivering news and opinion at the digital edge of journalism? How could he allow the phenomenally prolific creator of the Post’s Wonkblog to take his talents elsewhere? Actually, Post publisher Katharine Weymouth was the decider. “It just didn’t make sense for us,” Weymouth tells
Washingtonian. “Ezra didn’t want it to be part of the Post. It would be completely separate and quite resource-intensive.”
Klein first brought his proposal to Post executive editor Martin Baron in December. Baron recommended Klein go directly to Weymouth, who runs the Post’s business side. Klein met with Weymouth and described his new venture in a memo with a full business plan, including projected expenses and revenues. Weymouth says she examined the business plan for what she termed “a kind of authoritative wiki,” and decided the investment didn’t make sense. Klein reportedly projected the cost of building his new venture to be upward of $10 million, with up to 30 employees. “It seemed to be potentially a bigger distraction that would take resources without building the Post,” Weymouth says. “Had he wanted to keep Wonkblog within the Post, that would have been a different story.”
Weymouth sent Klein’s proposal with her decision against funding it to Bezos. She did not hear back from him. In other words, Bezos accepted her decision to go thumbs down on Klein’s proposition. Weymouth said she was “not shocked” that Klein would present her with a bold plan to create his own digital news operation. She described Klein, 29, as “young, smart, and entrepreneurial.” She explained her decision to spike Klein’s proposal face to face. “I admire him and emphasized that we wanted very much to leave the door open to working with us in the future,” Weymouth says. Neither Bezos nor Klein responded to questions of whether they had had any contact after Weymouth declined the offer.
More than a few news commentators and analysts panned the Post for allowing another talented writer take his energies elsewhere. “You idiots!” wrote New York Times columnist Paul Krugman on his blog earlier this month. Klein’s exit invited comparisons to Post writers John Harris and Jim VandeHei, who left the Post to start Politico. Weymouth, the granddaughter of legendary publisher Katharine Graham and the last family member at the Post’s helm, is bullish on the enterprise Klein is leaving behind. “Wonkblog is staying at the Post,” she says, “and we are going to invest heavily in building on what it is today. We had hoped that Ezra would want to lead that, but he wants to build something very different.”
Memo to newsroom staff from Marty Baron, Executive Editor: