What Jeff Bezos can do for the Washington Post

So when Amazon CEO Jeff Bezos committed to buy the venerable Washington Post for $250 million, the reaction in the battered world of journalism quickly went from astonishment … to a guarded hope that Bezos might find a way forward for an important but endangered institution.

With this transaction, the era of the metropolitan daily colossus with a monopoly on its region officially ends. Like other big-city dailies from Los Angeles to Chicago to Boston–where the Globe sold this month for pennies on the dollar of its former value to Red Sox owner and hedge-fund billionaire John Henry–the Washington Post is a business from a vanished past. These enterprises still have a valuable mission. What they lack is a viable business model.

A common mistake is to say that the Internet derailed this gravy train by giving readers the news for free. In truth, free news was nothing new.

The money came from the advertisers, from the individual classified-ad buyer eager to sell a used lawn mower, to the grocers and department stores and car dealers who bought page after page of costly display ads. The business was about collecting a mass audience for those advertisers, so publishers bundled all sorts of diverse content.

The digital revolution has unbundled the bundle.

The sale amounted to a recognition that Meyer’s descendants–not to mention the board of directors of the publicly traded parent company–had run out of ideas to revitalize a business that has seen revenues decline for seven straight years, with no end in view.

And that’s where a visionary billionaire comes in. As sole shareholder–he, and not Amazon, is the buyer. In a letter to the Post staff, Bezos said he has no map for the paper, nor does he intend to be a day-to-day manager. His willingness to invest is inferred from the notion that no one buys a newspaper with 58 Pulitzer Prizes in its history intending to tear it down. “The values of the Post do not need changing,” Bezos wrote.

He is likely to look for ways to break it up and give people the content they value in whatever form they want it–for a price. Personalized content and micropricing fit nicely alongside existing Amazon projects. But that makes it sound too easy.

… drawn to journalism as a competitive challenge rather than as a money machine, Bezos is in some senses a modern-day Eugene Meyer, buying low and looking to reshape the marketplace. That’s good news for the news business. As long as people who are able to buy anything still want to buy into journalism, there is light behind the storm clouds.

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