{"id":19726,"date":"2016-11-18T17:31:34","date_gmt":"2016-11-18T22:31:34","guid":{"rendered":"https:\/\/digital.hbs.edu\/platform-rctom\/submission\/bezos-the-washington-post-and-the-future-of-news-publishing\/"},"modified":"2016-11-18T17:33:56","modified_gmt":"2016-11-18T22:33:56","slug":"bezos-the-washington-post-and-the-future-of-news-publishing","status":"publish","type":"hck-submission","link":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/bezos-the-washington-post-and-the-future-of-news-publishing\/","title":{"rendered":"Bezos, the Washington Post and the future of news publishing"},"content":{"rendered":"<p><a href=\"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2016\/11\/Jeff-Bezos-pic-2.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-19723 aligncenter\" src=\"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2016\/11\/Jeff-Bezos-pic-2.jpg\" alt=\"jeff-bezos-pic\" width=\"797\" height=\"421\" srcset=\"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2016\/11\/Jeff-Bezos-pic-2.jpg 797w, https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2016\/11\/Jeff-Bezos-pic-2-300x158.jpg 300w, https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2016\/11\/Jeff-Bezos-pic-2-768x406.jpg 768w, https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2016\/11\/Jeff-Bezos-pic-2-600x317.jpg 600w\" sizes=\"auto, (max-width: 797px) 100vw, 797px\" \/><\/a><\/p>\n<p><strong>An industry in free fall<\/strong><\/p>\n<p>Digital technology has transformed the business of news, with profound implications for publishing operating and business models.<\/p>\n<p>The most dramatic impacts on operating models have been in production and distribution. Distribution have typically transformed from a single product to a proliferation of products, channels and formats:<\/p>\n<ul>\n<li>Products: Desktop, tablet, mobile and watch sites\/aps<\/li>\n<li>Channels: On platform via owned products, off platform (e.g., email, Facebook) and third party off platform (e.g., snapchat, apple news)<\/li>\n<li>Formats: Video, interactive graphics, messaging, podcasts<\/li>\n<\/ul>\n<p>This shift in distribution flows through to production. Examples include shifting from a process geared around the \u201cdaily miracle\u201d of a newspaper to a 24\/7 news cycle and the use of data &amp; analytics to assess performance and make decisions.<\/p>\n<p>On the business model, media companies created value for consumers by delivering news in the form of the paper, and for advertisers, by connecting them to consumers. While this holds true, digital transformation has altered competition and consumer behavior, eroding revenue.[1]<\/p>\n<p><a href=\"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2016\/11\/newspaper-revenue.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\" wp-image-19931 aligncenter\" src=\"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2016\/11\/newspaper-revenue.jpg\" alt=\"newspaper-revenue\" width=\"928\" height=\"476\" \/><\/a><\/p>\n<p>The internet gave advertisers more channels to reach consumers, including via technology companies with sophisticated ability to segment, target and demonstrate ROI relative to publishers.<\/p>\n<p>Consumers too have more choices for obtaining news and spending discretionary time. This impacts consumer willingness to pay \u2013 if news is available from free websites, why pay for a newspaper or digital subscription? Consumer trends toward ad-blocking and mobile (with lower CPMs than desktop and less real estate for display advertising) add to the challenge.<\/p>\n<p>Innovative new entrants saw opportunity, like Huffington Post with its user generated content and Buzzfeed, with socially content (e.g., listicles). Rather than invest in printing presses they could start a website, with less cost and many times the agility compared to incumbents. However, this advantage may not be sustainable. They also face the same pressures as traditional publishers (competition for ad revenue and consumer attention) without the advantage of brand heritage and audience trust.<\/p>\n<p>Globally, no one has cracked the problem facing news publishing. Given the critical role of news media as a check on government and corporate power, this should matter to everyone.<\/p>\n<p><strong>What do Amazon and the Washington Post have in common? <\/strong><\/p>\n<figure id=\"attachment_19756\" aria-describedby=\"caption-attachment-19756\" style=\"width: 390px\" class=\"wp-caption alignleft\"><a href=\"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2016\/11\/washpo-on-acquisition.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\" wp-image-19756\" src=\"https:\/\/d3.harvard.edu\/platform-rctom\/wp-content\/uploads\/sites\/4\/2016\/11\/washpo-on-acquisition.jpg\" alt=\"Washington Post had been struggling for several years when acquired\" width=\"390\" height=\"536\" \/><\/a><figcaption id=\"caption-attachment-19756\" class=\"wp-caption-text\">Washington Post had been struggling for several years when acquired<\/figcaption><\/figure>\n<p>Jeff Bezos, Amazon founder and CEO, purchased the Washington Post newspaper \u2018out of the blue\u2019 in 2013.<a href=\"#_ftn1\" name=\"_ftnref1\">[2]<\/a> For Bezos, the Post was well situated to be a watchdog over the leaders of the world\u2019s most powerful country and he could make a difference:<\/p>\n<p>\u201cI didn\u2019t know anything about the newspaper business, but I did know something about the Internet\u2026that, combined with the financial runway that I can provide, is the reason why I bought The Post.\u201d<a href=\"#_ftn2\" name=\"_ftnref2\">[3]<\/a><\/p>\n<p>Private ownership gives the Post the ability to invest, experiment and take a long-term view, huge advantages given there is no clear model for running a successful news publisher.<a href=\"#_ftn3\" name=\"_ftnref3\">[4]<\/a><\/p>\n<p><strong>Bezos at the Post<\/strong><\/p>\n<p>Bezos gives the Post significant advantages when it comes to talent, product and revenue strategy.<\/p>\n<p>Bezos\u2019s backing improves the Post\u2019s ability to attract quality product and engineering talent.<a href=\"#_ftn4\" name=\"_ftnref4\">[5]<\/a> Since 2013, the Post\u2019s engineering team has nearly tripled and per Bezos, rivals \u2018any team in Silicon Valley\u2019.<a href=\"#_ftn5\" name=\"_ftnref5\">[6]<\/a><\/p>\n<p>An owner that knows \u201csomething about the Internet\u201d and helps draw better talent also helps the Post improve its digital products. Under Bezos the Post has improved the speed to load (mobile from 4 to 0.8 seconds),<a href=\"#_ftn6\" name=\"_ftnref6\">[7]<\/a> design of is website and aps, improved recommendation engines, and started beta-testing headlines and content.<a href=\"#_ftn7\" name=\"_ftnref7\">[8]<\/a>\u00a0This has translated to a significant increase in unique audience and page views &#8211; October 2016 saw increases of 49% and 55% respectively year on year.[9] While the election is likely a contributor to these stellar results, the Post has broken its records month after month, even overtaking the New York Times for the first time ever in October 2015.[10]<\/p>\n<p>The Post is also shifting its revenue strategy from large amounts of revenue from very few subscribers, to small amounts of revenue from many.<a href=\"#_ftn8\" name=\"_ftnref8\">[11]<\/a> Bezos has ambitions to expand the Post beyond being a local daily newspaper, to a national or even global one.<a href=\"#_ftn9\" name=\"_ftnref9\">[12]<\/a> An example of Bezos\u2019s efforts to build scale is bundling aps with Amazon products, like Kindle and Prime.<a href=\"#_ftn10\" name=\"_ftnref10\">[13]<\/a><\/p>\n<p>The Post has also looked to build an alternative revenue stream: Selling software to other publishers<a href=\"#_ftn11\" name=\"_ftnref11\">[14]<\/a> with a target of $100m revenue.<a href=\"#_ftn12\" name=\"_ftnref12\">[15]<\/a><\/p>\n<p><strong>Why stop here?<\/strong><\/p>\n<p>Another opportunity for Bezos to leverage Amazon at the Post is data sharing. Matching Amazon\u2019s data to the Post\u2019s audience to create segments would create a compelling value proposition for advertisers.<\/p>\n<p>Given the Post\u2019s ambitions of global scale, the Post should broaden and deepen its partnerships with publishers around the world. Content sharing partnerships give the Post access to new readers and localized content.<\/p>\n<p>Continuing to experiment will be critical as the news publishing industry tries to find a way forward. Bezos\u2019s ownership gives the Post unparalleled advantages in this. If the Post can prove out a sustainable operating and business model, it\u2019s is good news for democracy.<\/p>\n<p>(799 words)<\/p>\n<p>[1] Amy Mitchell, Jesse Holcom, &#8220;State of the News Media 2015&#8221;,\u00a0Pew Research Centre, April 29, 2015,\u00a0http:\/\/www.journalism.org\/files\/2015\/04\/FINAL-STATE-OF-THE-NEWS-MEDIA1.pdf, accessed November 2016<\/p>\n<p><a href=\"#_ftnref1\" name=\"_ftn1\">[2]<\/a>\u00a0(Source for image) William Launder, Christopher S. Stewart and Joann S. Lublin, \u201cBezos Buys Washington Post for $250 Million\u201d, Wall Street Journal, August 5, 2013, <a href=\"http:\/\/www.wsj.com\/articles\/SB10001424127887324653004578650390383666794\">http:\/\/www.wsj.com\/articles\/SB10001424127887324653004578650390383666794<\/a>, accessed November 2016; Paul Fahri, \u201cWashington Post closes sale to Amazon founder Jeff Bezos,\u201d<em>\u00a0<\/em><em>The Washington Post<\/em><em>, <\/em>October 1, 2013,\u00a0<a href=\"https:\/\/www.washingtonpost.com\/business\/economy\/washington-post-closes-sale-to-amazon-founder-jeff-bezos\/2013\/10\/01\/fca3b16a-2acf-11e3-97a3-ff2758228523_story.html\">https:\/\/www.washingtonpost.com\/business\/economy\/washington-post-closes-sale-to-amazon-founder-jeff-bezos\/2013\/10\/01\/fca3b16a-2acf-11e3-97a3-ff2758228523_story.html<\/a>, accessed November 2016.<\/p>\n<p><a href=\"#_ftnref2\" name=\"_ftn2\">[3]<\/a> Mike Isaac, \u201cAmazon\u2019s Jeff Bezos Explains Why He Bought The Washington Post\u201d, The New York Times: Bits, December 2, 2014, <a href=\"http:\/\/bits.blogs.nytimes.com\/2014\/12\/02\/amazons-bezos-explains-why-he-bought-the-washington-post\/\">http:\/\/bits.blogs.nytimes.com\/2014\/12\/02\/amazons-bezos-explains-why-he-bought-the-washington-post\/<\/a>, accessed November 2016.<\/p>\n<p><a href=\"#_ftnref3\" name=\"_ftn3\">[4]<\/a> Dan Kennedy, \u201c5 things publishers can learn from how Jeff Bezos is running The Washington Post\u201d, Nieman Lab, June 8, 2016, <a href=\"http:\/\/www.niemanlab.org\/2016\/06\/5-things-publishers-can-learn-from-how-jeff-bezos-is-running-the-washington-post\/\">http:\/\/www.niemanlab.org\/2016\/06\/5-things-publishers-can-learn-from-how-jeff-bezos-is-running-the-washington-post\/<\/a>, November 2016.<\/p>\n<p><a href=\"#_ftnref4\" name=\"_ftn4\">[5]<\/a> Eugene Kim, \u201cHow Amazon CEO Jeff Bezos reinvented The Washington Post, the 140-year-old newspaper he bought for $250 million\u201d, Business Insider, May 14, 2016, http:\/\/www.businessinsider.com\/how-the-washington-post-changed-after-jeff-bezos-acquisition-2016-5\/, accessed November 2016.<\/p>\n<p><a href=\"#_ftnref5\" name=\"_ftn5\">[6]<\/a> Ibid.<\/p>\n<p><a href=\"#_ftnref6\" name=\"_ftn6\">[7]<\/a> Gabriel Sherman, \u2018Good News at the Washington Post\u2019, New York Magazine, June 28, 2016, <a href=\"http:\/\/nymag.com\/daily\/intelligencer\/2016\/06\/washington-post-jeff-bezos-donald-trump.html\">http:\/\/nymag.com\/daily\/intelligencer\/2016\/06\/washington-post-jeff-bezos-donald-trump.html<\/a>, accessed November 2016; Lukas I. Alpert, Jack Marshall, \u2018Bezos Takes Hands-On Role at Washington Post\u2019, Wall Street Journal, December 20, 2015,\u00a0 <a href=\"http:\/\/www.wsj.com\/articles\/bezos-takes-hands-on-role-at-washington-post-1450658089\">http:\/\/www.wsj.com\/articles\/bezos-takes-hands-on-role-at-washington-post-1450658089<\/a>, accessed November 2016.<\/p>\n<p><a href=\"#_ftnref7\" name=\"_ftn7\">[8]<\/a> Dan Kennedy, \u201cThe Bezos Effect: How Amazon\u2019s Founder Is Reinventing The Washington Post \u2013 and What Lessons It Might Hold for the Beleaguered Newspaper Business\u201d, 性视界 Kennedy School Shorenstein Centre on Media, Politics and Public Policy, June 8, 2016, <a href=\"http:\/\/shorensteincenter.org\/bezos-effect-washington-post\/\">http:\/\/shorensteincenter.org\/bezos-effect-washington-post\/<\/a>, accessed November 2016.<\/p>\n<p>[9] Washington Post PR Blog, November 14, 2016, https:\/\/www.washingtonpost.com\/pr\/wp\/2016\/11\/14\/the-washington-post-records-nearly-100-million-visitors-in-october-greatly-exceeding-previous-traffic-records\/?tid=hybrid_collaborative_1_na, accessed November 2016<\/p>\n<p>[10] Jordan Valinsky, &#8220;Washington Post tops New York Times online for first time ever&#8221;, Digiday, November 13, 2015,\u00a0http:\/\/digiday.com\/publishers\/comscore-washington-post-tops-new-york-times-online-first-time-ever\/, accessed November 2016.<\/p>\n<p><a href=\"#_ftnref8\" name=\"_ftn8\">[11]<\/a> Dan Kennedy, \u201c5 things publishers can learn from how Jeff Bezos is running The Washington Post\u201d, Nieman Lab, June 8, 2016, <a href=\"http:\/\/www.niemanlab.org\/2016\/06\/5-things-publishers-can-learn-from-how-jeff-bezos-is-running-the-washington-post\/\">http:\/\/www.niemanlab.org\/2016\/06\/5-things-publishers-can-learn-from-how-jeff-bezos-is-running-the-washington-post\/<\/a>, accessed November 2016.<\/p>\n<p><a href=\"#_ftnref9\" name=\"_ftn9\">[12]<\/a> Mike Isaac, \u201cAmazon\u2019s Jeff Bezos Explains Why He Bought The Washington Post\u201d, The New York Times: Bits, December 2, 2014, <a href=\"http:\/\/bits.blogs.nytimes.com\/2014\/12\/02\/amazons-bezos-explains-why-he-bought-the-washington-post\/\">http:\/\/bits.blogs.nytimes.com\/2014\/12\/02\/amazons-bezos-explains-why-he-bought-the-washington-post\/<\/a>, accessed November 2016.<\/p>\n<p><a href=\"#_ftnref10\" name=\"_ftn10\">[13]<\/a> Ibid.; Ken Doctor, \u201cNewsonomics: The Washington Post offers an Arc in the storm\u201d, Nieman Lab, October 1, 2015, <a href=\"http:\/\/www.niemanlab.org\/2015\/10\/newsonomics-the-washington-post-offers-an-arc-in-the-storm\/\">http:\/\/www.niemanlab.org\/2015\/10\/newsonomics-the-washington-post-offers-an-arc-in-the-storm\/<\/a>, accessed November 2016.<\/p>\n<p><a href=\"#_ftnref11\" name=\"_ftn11\">[14]<\/a> Gabriel Sherman, \u2018Good News at the Washington Post\u2019, New York Magazine, June 28, 2016, <a href=\"http:\/\/nymag.com\/daily\/intelligencer\/2016\/06\/washington-post-jeff-bezos-donald-trump.html\">http:\/\/nymag.com\/daily\/intelligencer\/2016\/06\/washington-post-jeff-bezos-donald-trump.html<\/a>, accessed November 2016.<\/p>\n<p><a href=\"#_ftnref12\" name=\"_ftn12\">[15]<\/a> Ken Doctor, \u201cNewsonomics: The Washington Post offers an Arc in the storm\u201d, Nieman Lab, October 1, 2015, <a href=\"http:\/\/www.niemanlab.org\/2015\/10\/newsonomics-the-washington-post-offers-an-arc-in-the-storm\/\">http:\/\/www.niemanlab.org\/2015\/10\/newsonomics-the-washington-post-offers-an-arc-in-the-storm\/<\/a>, accessed November 2016.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>When Jeff Bezos acquired the Washington Post out of the blue in 2013, the media community was shocked. Three years later, it all makes sense.<\/p>\n","protected":false},"author":2675,"featured_media":20144,"comment_status":"open","ping_status":"closed","template":"","categories":[2270,2500,911,786,910],"class_list":["post-19726","hck-submission","type-hck-submission","status-publish","has-post-thumbnail","hentry","category-digital-disruption","category-digital-media","category-jeff-bezos","category-newspaper","category-washington-post"],"connected_submission_link":"https:\/\/d3.harvard.edu\/platform-rctom\/assignment\/digitization-challenge-2016\/","yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Bezos, the Washington Post and the future of news publishing - Technology and Operations Management<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/bezos-the-washington-post-and-the-future-of-news-publishing\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Bezos, the Washington Post and the future of news publishing - Technology and Operations Management\" \/>\n<meta property=\"og:description\" content=\"When Jeff Bezos acquired the Washington Post out of the blue in 2013, the media community was shocked. 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