Jeff Bezos and his journalists

By Felix Salmon
August 6, 2013

I’m a huge admirer of Jeff Bezos, and the way in which he has managed to dodge the biggest pitfall facing the managers of public companies: rather than maximize short-term profits, he instead has concentrated — with enormous success — on building long-term value. Amazon is now worth about $140 billion, or more than 500 Washington Posts — more, indeed, than the combined valuation of every single newspaper in the world, put together.

Many of those newspapers, including the Washington Post, were once public companies, with stock-market listings and quarterly profit reports and the like; historically they had very fat margins, and as a result of those fat margins they had substantial stock-market valuations. When those margins imploded, taking the newspapers’ profits with them, the papers were left with almost no value: the Boston Globe was sold for essentially a negative sum, once pension obligations are taken into account, while the Washington Post was sold for the price of a nice Cézanne. Meanwhile, if Amazon were to start losing money for a few quarters, few people would blink an eye; the value of the company certainly wouldn’t plunge to less than a billion dollars.

On the face of it, then, the acquisition of the Washington Post by Jeff Bezos is very good news. If newspapers were ever suited to public stock-market listings, they’re not any more; private ownership, especially ownership by an individual benign billionaire, is a much better model for all concerned. Bezos is not the kind of man who worries about losing a few million dollars here or there: he has his eye on building long-term value and relevance, which is exactly how the best newspaper owners behave. After the Graham family bought the Washington Post in 1933, for instance, it took 20 years before the paper started making real money. Jeff Bezos, who has spent some $42 million building a clock designed to last 10,000 years, has exactly the amount of patience, and money, that a modern newspaper owner needs.

What Bezos lacks, I fear, is the kind of personal talent-management skills common to most great publishers. There’s a virtuous cycle to successful publishers: as you grow in size and prestige, both advertisers and readers flock to you, you start making lots of money, which in turn allows you to hire the best writers and editors and art directors, and to spend big money on fast, effective distribution. Those people, in turn, put out a first-rate product which is very difficult to compete with.

Until, of course, the internet comes along, and everything fragments into a million tiny pieces.

If Bezos were to look at the most successful large-scale publishing operations of the past few decades, he would see a lot of waste. Some publishers, like Condé Nast or the Time Inc of old, turned lavish profligacy into something of an artform; newer entrants into the scene, such as Bloomberg, are no slouches on that front either. Meanwhile, as journalists of all stripes find themselves converging on the same digital platforms, print journalists are increasingly direct peers and competitors of their TV counterparts, where money has always been much more abundant.

Online, it’s all too easy for such operations to be disrupted by lean and efficient upstarts. Bezos’s previous investment in the journalism space was in Business Insider, one such operation: the journalists there work very hard, in a no-slack, no-waste environment, putting out vastly more content per person than any print or TV operation would ever dream of. At places like the Huffington Post, or Gawker, or Business Insider, the goals are clearly articulated, and usually revolve around pageviews or unique visitors or some such metric. And while such outfits certainly can and do spend a lot of time working on projects which might not pay off in a narrow traffic sense, they generally do so consciously, deliberately, as a tactical departure from the hyper-efficient default mode.

At a large newspaper, the default mode cannot be hyper-efficient; the papers which have tried, which have modeled themselves on digital startups, have generally failed. A large and valuable franchise like the Washington Post generally improves the more slack there is in the system. If you have enough money that you can hire stars, treat them generously, and then leave them alone to do their thing, then they will ultimately reward you with first-rate (and very expensive) content. Your job, then, is to find a way to monetize that content.

Amazon, by contrast, is all about efficiency. It has a relatively small number of executives at its headquarters, who are paid overwhelmingly in stock; if the stock does well, they do well. It also employs, mostly indirectly, thousands of workers in warehouses around the world, picking and packaging the goods it sells; those workers are treated badly, and enjoy effectively zero slack in their working lives. What Amazon doesn’t have is paternalism, or a culture which in any way tolerates any unnecessary increase in labor costs. Its employees are cogs in the corporate machine, and they are expected to work as efficiently as possible.

The Grahams (or the Sulzbergers, or the Newhouses, or the Chandlers, or the Bancrofts) never thought of their journalists and editors that way. And the fact is that while you can achieve better profits by cutting here and maximizing there, you can never achieve long-term greatness that way. Greatness emerges mysteriously from the slack in the system, from source lunches and newsroom cross-pollination and expensive editorial whims. It emerges, ultimately, from the ability to give people time and space and money, in the certain knowledge that most of that time and space and money will end up being wasted, and embracing that waste as a good and ultimately necessary thing.

The Washington Post has not had the luxury of being able to waste time and space and money, not in many years — and as a result it is no longer a great newspaper. Maybe no newspaper can ever be great again, in that sense: the economics just don’t support it any more. But the fact is that Jeff Bezos is now an employer of journalists, and as such he is in charge of hiring and firing and paying a group of employees quite unlike any he has hired in the past. They’re not always rational, they’re not always efficient, and as a group they tend towards the skeptical and cantankerous. On top of that, they’re not entirely motivated by money.

Happy proprietors tend to like journalists — they admire what they do, and how they think. (Exhibit A: David Bradley, at Atlantic Media.) Jeff Bezos, I fear, is not going to be a happy proprietor. He’s going to keep himself occupied thousands of miles away from where his journalists will be working; he’s not going to get to know them on a personal level; he’s certainly not going to enjoy gossip-fueled lunches at the Four Seasons with Tina Brown or Arianna Huffington. If Ezra Klein is ever tempted to take Wonkblog to richer shores, or just to quit altogether to concentrate on a television career, it’s hard to imagine Bezos offering him a glass of whisky and promising to make whatever changes would be necessary to get him to stay.

To put it another way: the best proprietors are only happy when their journalists are happy. They throw resources at those journalists, and then the journalists smile, in their grumbly way, and waste a bunch of what they’ve been given, and ultimately produce wonderful content, which the proprietor can then turn around and monetize in one way or another. Bezos isn’t going to be like that, or at least I don’t think he will be. Still, I hope I’m wrong. Because if he does take an avuncular interest in whatever makes his journalists happy, then a man with his skills, and his resources, could yet turn out to be one of the most interesting and successful newspaper proprietors of all time.

More From Felix Salmon
Post Felix
The Piketty pessimist
The most expensive lottery ticket in the world
The problems of HFT, Joe Stiglitz edition
Private equity math, Nuveen edition
Five explanations for Greece’s bond yield
21 comments so far

I don’t know if the analogy fully works or not, but here goes. A great media publication is closer in style to a fine local restaurant, where dishes are lovingly prepared with the distinct fingerprints of its chef (actually, a team of them) than a national chain, where adherence to consistent, patterned execution from one location to the next is most paramount.

Amazon is more akin to the national chain than the local restaurant, which raises the question of whether Bezos’ view of Washington Post is more as patron to a public good, or an extension of Amazonian principles.

As your article notes, while there are plenty of wrong answers, less obvious is what is the right answer, the workable one that is worthy of Bezos’ time, money and attention.

Posted by hypermark | Report as abusive

Eloquent stuff! I don’t suppose I could tempt you into doing a few hundred words on how *my* profession needs to be given plenty of fine dining, relaxed working conditions and next to no quality control, could I?

Posted by dsquared | Report as abusive

So let me get your thesis straight – let every one relax and have ‘source lunches’, encourage ‘expensive editorial whims’ and good things will happen… That’s a nice theory. No wonder you want a philanthropist to foot the bill for it.
@hypermark – the fine local restaurant is a poor analogy imho. In Felixworld, the cooks would be having lunch while your customers were waiting for theirs.

Posted by FDum | Report as abusive

When I worked at Gannett, I used to call it the “Wal-Mart of journalism.” But that was 20 years ago. “Amazon of journalism” would work just as well now.

But if Bezos’s goal is to squeeze as much profit out of the Post as possible, why did he even buy it? There are plenty of other places where he could put his rapacious capital to work at much higher rate of returns.

Posted by PeterPrinciple | Report as abusive

Felix, you’re assuming that Bezos only knows how to use a hammer, and he will view every company as a nail. He’s too smart for that.

Also, he said in a letter to WaPo employees he has a day job that he doesn’t intend to quit.

I don’t doubt that many of Amazon’s warehouse workers are unhappy, but I’m guessing that most jobs that require no skills and pay near minimum wage are just as undesirable. That’s what happens when there are less jobs than people who want them.

Posted by KenG_CA | Report as abusive

Bloomberg’s operation allows plenty of slack. And the Washington Post under Bezos will too, I suspect.

But not everyone can be a star. Not everyone deserves slack. Slack is something you earn, or that you create for yourself.

What this medium lacks is cross-promotion. Take yourself as an example. How often are you on TV? Where’s your latest book? If you are not pushing your own “brand,” you’re terribly naive today.

I learned this the hard way, treading water incessantly for almost 3 decades because I bought the old idea that the brand will stand behind you, that you are who you work for.

It’s not true. Journalism, like everything else, is about the creation and development of talent. Talent gets slack. Slackers get fired. It’s a business.

The big lie is that journalism schools have never told students this truth, and so we have entered the “work force” believing we are who we work for, rather than what we do.

Posted by dblankenhorn | Report as abusive

Not the strongest post to say the least. A journalist arguing that journos do their best work when pampered and left alone – well, that’s just not credible, certainly not in the world we now live in. And i doubt many editors, even from previous decades, would agree. Yes, they left some journos investigate and spent time and effort on stories, just on hunches, but I just don’t buy the idea that they wouldn’t rein people in. The leach was never as long as Felix seems to think, and certainly not for most journos at most publications.
The second point is that while it’s true that some great journalism comes out the way Felix describes, anyone who’s read articles about things like y2k, war on terror etc also knows that much journalism is in fact churnalism (read the Guardian’s’ Davies book on that) just copy pasting press releases, statements etc…

Posted by fxtrader7 | Report as abusive

Wish there was a way to “like” or reply to other comments. Fxtrader7 has the best response to Mr Salmon’s fluffy piece.

Posted by Mohan_Kompella | Report as abusive

Felix did it occur to you that there is another major category of Amazon employees, namely, the software architects, developers and operations staff which keeps its vast data centers humming and climbing the technology curve?

Could you acknowledge that Amazon’s technologists are some of the best in the business and regularly receive accolades for their professional accomplishments? That they, along with companies such as Google and Twitter, are in fact advancing the state of the art in distributed computing?

And that, perhaps, those technologists, architects, and developers might have some “slack” in their professional lives? Much more comparable to, say, editors and top journalists? And that perhaps the Amazon warehouse workers doing fulfillment are more properly compared to those working the physical delivery chain for the dead tree editions of the Post?

And that if you did indeed acknowledge all this, about Amazon, that there wouldn’t be much of a point to your post?

Posted by lewy14 | Report as abusive

I think Jeff Bezos’ purchase could mark the renewal of journalism. He is an intelligent man and obviously didn’t go into this with his eyes closed. He must have big plans for the Washington Post and I am excited to see what he does next. The world needs real, honest journalism. Also, the cost of a few fancy lunches is forgotten once a journalist finds a cracker of a story. In the majority of professions, a certain amount of “schmoozing” is required. Why would journalism be any different?

Posted by colette_sexton | Report as abusive

“The Grahams (or the Sulzbergers, or the Newhouses, or the Chandlers, or the Bancrofts) never thought of their journalists and editors that way.”

That is irrelevant. How did they treat their printers and office boys?

Posted by samadamsthedog | Report as abusive

“The Grahams (or the Sulzbergers, or the Newhouses, or the Chandlers, or the Bancrofts) never thought of their journalists and editors that way.”

That is irrelevant. How did they treat their printers and office boys?

Posted by samadamsthedog | Report as abusive

I’m starting to understand Felix’s severe drop in output. He has a happy proprietor.

Posted by Zdneal | Report as abusive

Having worked for both Amazon and online media companies, I fear for The Washington Post. On the bright side together they might crack the online media monetisation problem, for the rest of us, but I fear quite a few casualties along the way.

Posted by smiler29 | Report as abusive

If Jeff Bezos is buying the Washington Post, my suspicion is that he has some idea about the future of media, and wants to use the Washington Post as a test bed for that idea. It would be wrong to assume that his idea is the same as his idea for online sales. It’s probably something else. However, I doubt it’s about pampering journos. It will be about working out what sort of content people want, and how to get it to them at the price they’re willing to pay. He’s obviously interested in the high quality content side of the equation, so he’ll be aiming for high quality. But since I can’t read his mind, I can’t tell you what he’s up to exactly.

Posted by Doly | Report as abusive

If Jeff Bezos is buying the Washington Post, my suspicion is that he has some idea about the future of media, and wants to use the Washington Post as a test bed for that idea. It would be wrong to assume that his idea is the same as his idea for online sales. It’s probably something else. However, I doubt it’s about pampering journos. It will be about working out what sort of content people want, and how to get it to them at the price they’re willing to pay. He’s obviously interested in the high quality content side of the equation, so he’ll be aiming for high quality. But since I can’t read his mind, I can’t tell you what he’s up to exactly.

Posted by Doly | Report as abusive

Felix is optimistic. I hope he is correct.

Since no one asked, I will share my thoughts. Investigative journalists and reporters with Reuters, the New York Times, Washington Post and Wall Street Journal (both text and radio) are the equivalent of “rock star programmers”. Rock star programmers are not prima donna’s. They aren’t Walter Winchell’s of software engineering. Instead, there are exceptionally competent, valuable programmers who are given whatever resources and supportive work environment necessary. This doesn’t imply huge expense accounts and material extravagance, but rather, good chairs, big monitors, skilled co-workers, whatever O/S makes them happy, be it Windows, Mac, Linux (and their preferred distro), indulging a preference for git over mercurial, that sort of thing.

Jeff Bezos should know this. He clearly treats his programming and technical staff much differently than the masses of striking workers that he seems to think of as automata. I don’t know what happened to him. He wasn’t always this way. Anyway, if Jeff Bezos treats reporters and journalists like software engineers and developers, rather than the way he treats the rest of his employees, then maybe something good will come of this.

@samadamsthedog Why does it not matter how journalists and reporters were treated, but only printers and office boys? If a company is run well, office boys become professionals (at the same company) given time and opportunity, including education. That’s what Goldman Sachs and IBM used to do. It worked well.

@fxtrader7 What was the problem with Y2K reporting? There were no apocalyptic system failures because many people worked very hard for three to five years prior. As for copy and paste, there is a certain amount of repetition, some of which is due to syndication. Have you ever tried to get all your information from government statements or press releases? Good luck with that. Sifting out the meaningful content, interpreting in context, for every country, subject, market is impossible for one person. Journalists do that for us.

@Kevin in CA Yes, Jeff Bezos is brilliant. Something is amiss though, else he wouldn’t treat his warehouse employees so poorly. No blame can be attributed to vagaries of locale, as it seems to be global. Similarly, it is short-sighted to be such a rapacious competitor that you undermine the society and infrastructure that is your customer base. Tell me, does it make sense to sell original Monet, Dali, Picasso, Warhol and Wyeth paintings on Amazon online, with prices ranging from $100,000 to $3,000,000? That’s what I saw today. If his judgement is such that he would do that, I worry what he’ll do with our independent, third-party press.

@PeterPrinciple I think you are correct too. @Hypermark’s analogy isn’t terrible either, though maybe more gentle than strictly necessary.

Posted by EllieK | Report as abusive

EllieK, I don’t condone Bezos’ treatment of warehouse workers, and I wouldn’t do the same if it was my call, but it’s not. He isn’t much different than Wal-Mart in that respect, paying what the market demands for that kind of labor. However, unlike Wal-Mart, their employee/contractor base is not large enough to undermine the society. And I don’t view them as a rapacious competitor, just a competent one in a sea of incompetence. Their prices aren’t that much better, and certainly not the main reason why most of their customers shop there – it’s because it’s convenient, and their service is far better than most retailers – almost every brick and mortar retailer treats their workers like the replaceable drones they have made them, and the result is horrible service (I dread going into almost every store). And as for their on-line competition, their sites are no match for Amazon, they often reek of bad design and bugs.

Does it make sense to sell original classics on Amazon? It does if they sell and the cost of trying is next to nothing. What’s wrong with that, you don’t like rent-seeking art brokers losing control of their markets and their 7- and 8-digit incomes? And how does that business foretell how he will manage his newspaper?

Posted by KenG_CA | Report as abusive

This is a fine and wise analysis of the Post’s downfall. It is no longer a great paper but that is partly by choice, too, and not simply due to resources. Katharine Weymouth is there because of nepotism – not proven ability. And so was Donald Graham for that matter. The NY Times knows who its audience is: New York’s financial, cultural, intellectual and political elites and those who want to join them. The Post’s management does not. Jeff Bezos would do well to begin with choosing a new management team that refocuses its resources.

Posted by eric20008 | Report as abusive

Ken of CA,
I wish it WERE your decision, how to treat Amazon warehouse workers! The cognitive dissonance rankles. If Bezos were a grumpy son of a son of a Walton or other scion of inherited wealth, it would not shock me. Yet Amazon’s corporate persona has been books, health food and eco-friendly products, then AWS (sort of) making computing resources accessible to all, with PaaS. Amazon doesn’t refuse to carry legal products, like Walmart, but they are similar enough. I was so naive.

Agreed, Amazon prices aren’t so much less, than others. They are very reliable, with good about customer service and delivery. That may be changing, based on hearsay, but I haven’t noticed it.

As for the high-end fine art, that seems wacky. Here’s why: Art brokers are not rent-seeking when one is purchasing an original oil painting by Warhol, Picasso or Manet, for $500,000 to three million dollars. That’s because art dealers confirm authenticity, assess the condition and know details of provenance. I’m certain that it would be transported correctly, etc. There are a limited number of fine art works extant in the world. If an individual wants to own one, and has the money to do so, and responsibly care for it, I have no objection (some would say it was wrong because it should be in a museum instead; that is not my belief).

Yet Amazon is just listing these paintings with length by width, artist name and title, and promising next day shipment. You don’t sell expensive, fragile, rare items the same as bulk dry goods. That was the basis for my comparison with the Washington Post. Ebooks, rare fine art work and journalists aren’t fungible commodities. Jeff Bezos must realize this, of course, but selling fine art on is recent, and odd.

Thank you so much for replying to my comment! I appreciate that.

Posted by EllieK | Report as abusive

Bezos successfully employs many software engineers and web designers. They are as easy to manage as herding cats. Schedules in software are regularly broken. Journalists, by and large, speak English (at least at the Washington Post). Software engineers, not so much: mostly techno-babble…

Posted by AreaMan | Report as abusive
Post Your Comment

We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see