Seeking Alpha

Jeff Bezos buying Washington Post newspaper ops for $250M

  • The Amazon founder/CEO is acquiring The Washington Post's (WPO) newspaper publishing ops for $250M.
  • Amazon is not involved in the transaction.
  • The deal includes "The Washington Post and other publishing businesses, including the Express newspaper, The Gazette Newspapers, Southern Maryland Newspapers, Fairfax County Times, El Tiempo Latino and Greater Washington Publishing."
  • Slate magazine, TheRoot.com, Foreign Policy magazine, and other Washington Post assets aren't part of the transaction.
  • WPO +1.9% AH. (PR)
  • Update (5:12PM ET): Shares now +5.5% AH.
Comments (11)
  • Drew Robertson
    , contributor
    Comments (313) | Send Message
     
    WPO mkt cap $4.2B Washington Post price $250m.
    5 Aug 2013, 04:50 PM Reply Like
  • thesuer
    , contributor
    Comments (251) | Send Message
     
    Why are rich people buying newspaper businesses:
    1. Subscriber base
    2. Circulation, content, customer reach
    3. Advertising revenues

     

    I am of the opinion that user between the ages of 10-20 don't read newspapers, users between 20- 55 use the Internet leaving the above 55 - 75 age group. I can understand depreciated machinery and assets at salvage value but why buy the newspaper operations, for 1,2,3 above? He has all three with amazon anyway!
    Any opinions?
    Thanks
    5 Aug 2013, 05:02 PM Reply Like
  • Tschurin
    , contributor
    Comments (313) | Send Message
     
    Just an off the cuff thought but let's not forget that Amazon has recently gone through major political battles regarding the online sales tax issue. Perhaps that further impressed upon Bezos the importance of influencing the political arena and, despite the Post's current situation, it is still the dominant print media outlet in the nation's capital.
    5 Aug 2013, 10:30 PM Reply Like
  • James Sands
    , contributor
    Comments (1916) | Send Message
     
    The press has always been a crucial piece to the puppeteer.
    5 Aug 2013, 10:32 PM Reply Like
  • positivethoughts
    , contributor
    Comments (1812) | Send Message
     
    1. Kaplan Education
    2. Cable Television
    3. Influence in Washington
    5 Aug 2013, 05:32 PM Reply Like
  • Peter Larson
    , contributor
    Comments (611) | Send Message
     
    Bezos isn't getting Kaplan, slate, or the cable television properties. Just the papers.
    5 Aug 2013, 11:24 PM Reply Like
  • Swisser998
    , contributor
    Comments (128) | Send Message
     
    That was a waste of $250 million.
    5 Aug 2013, 09:10 PM Reply Like
  • James Sands
    , contributor
    Comments (1916) | Send Message
     
    Despite the demise of print, many newspapers still have strong margins for profitability. The LA Times for example. These were some of the best cash cow businesses back in the day. Just because the Tribune paid too much for the LA Times and has mismanaged most of their assets, doesn't mean that the entire industry is in completely in shambles.

     

    There are still profits to be milked and I think a lot of big investors have realized that the death may be going more slowly than anticipated, so why not get some cash over the next ten years.

     

    More people still read the paper than we think.

     

    When the Tribune spins off its print assets, watch who comes to the table to bid on the LA Times, the company will get bought by a private investor.
    5 Aug 2013, 10:26 PM Reply Like
  • Ray Lopez
    , contributor
    Comments (1508) | Send Message
     
    Waste of money, though Buffett also likes newspapers. Seniors have money and will continue to subscribe, albeit at a declining rate as funerals progress (subscriptions are down at the W Post -6% from last year).

     

    My only speculative, optimistic thought: what if Bezos somehow has figured out a plan where every W. Post subscriber gets a free Kindle-type cheap app, where the news can be downloaded wirelessly? Then that becomes a potential game changer, once it catches on. I for one hope that's the case--I'm tired of 'free news' as it tends to be too monotonous.
    6 Aug 2013, 04:30 AM Reply Like
  • chopchop0
    , contributor
    Comments (3135) | Send Message
     
    Buffett likely passed over this deal. He is profiting from it though

     

    http://bit.ly/19KPvYc
    6 Aug 2013, 10:18 AM Reply Like
  • Yorick
    , contributor
    Comments (493) | Send Message
     
    So the NYT has only a building (much leased to Carey) and its paper...based on the WPO sale and that NYT has about 4x the circulation with a $1.77b market cap, it might seem that NYT stock is a bit higher than it should be. Perhaps the brand and the building justify the premium but if Bezos and John Henry with the Globe move aggressively to cut fixed assets, union contracts etc...the end for print is anon.
    6 Aug 2013, 08:19 AM Reply Like
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