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Bring on Bezos!

31 Aug 2013
Posted by Shannon

There's no way for the current crop of mismanaged newspapers to change how they do business unless someone new buys them, which is why my Salon piece is cheering on Amazon's Jeff Bezos snagging the Washington Post.

The people currently running newspapers don't seem to have the skills to profit outside of the monopoly environment they once enjoyed, which until recently was giving them 20 to 40 per cent profit margins. All they know how to do is cut the quality of the product, which is absolutely the wrong strategy in a competitive market. Even worse they're erecting paywalls while reducing the quality of their newspapers, trying to squeeze a few more pennies out of their ever-dwindling pool of loyal customers. That's just cheating them. In a monopoly market that kind of thinking is safe and in some circles might even be advisable. But exploiting and abusing customers who have options outside of such cynical environs isn't just stupid -- it's suicide.

Bezos, on the other hand, knows how to compete. So I think he will do what I would do if I had $250 million to spend on a journalism experiment.  I'm betting he will launch a variation on the old-fashioned newspaper model of selling eyeballs-to-advertisers, using good journalism as the bait. Only he'll replace display ads with online shopping, which Amazon does so well.