August 8, 2013

Mr. Bezos, tear down that wall.

I don't think the ownership of the WaPo has exchanged hands yet, but my first thought on hearing the news that Jeff Bezos had bought The Washington Post is: He should take down the paywall. For about a day, I imagined that maybe he'd already made that happen. I was getting to lots of articles, but it turned out it was just close enough to the beginning of the month that I hadn't maxed out on the free access yet.

This morning, I'm trying to read "Jeff Bezos, The Post's incoming owner, known for a demanding management style at Amazon" and I have to hit the "reader" button to get to the text. Bezos needs to demand that the wall go. Having more readers is what really matters. Turning all that volume into money is something that can happen later. Isn't that how Amazon works? And anyway, Bezos already has so much money that he doesn't need to use WaPo to get more money. He needs it for his personal prestige and power. More readers suits that goal better than squeezing some money out of some of them.

Anyway, what is this "demanding style"? Paragraph 1 says he ends conversations that go on too long. Paragraph 2 says he has a "famously long-term approach." Interesting combination relating to time: patience in one sense and not in another. He's patient with the development of the product and the market, but wants efficiency internally. Paragraph 3 reinforces that point:
He favors a nimble, loosely organized company in which “two-pizza teams” execute important corporate tasks, because a work group requiring three pizzas over a lunch meeting is inherently too cumbersome. And he often requires employees pitching new ideas to write mock news releases for their product’s imagined launch, a way of focusing their minds on what will most excite customers.
Put it in writing. Don't blather with me for an hour, when you can crystallize your thoughts through the writing process, and I can read it all in a minute.

Reading on, there's lots about efficiency. It's one thing to hate to waste any time — many of us identify with that. What's unusual is the willingness to impose rigorous efficiency on others, to decline the comforts of being nice to the people in your immediate environment, and to do it out of regard for the customers, the people out there, out of your sight.

How will this style apply to running the newspaper?
Bezos has said that he intends to keep his focus on Amazon and keep his home in the Seattle area rather than becoming a fixture in Washington, as four generations of The Post’s outgoing owners, the Graham family, have been.
Good. Be the outsider. Be in it for us, the readers, not to be a part of some sick insider culture.
Bezos also has agreed to keep the newspaper’s top executives in place, though they may need to work without a popular corporate management tool: PowerPoint presentations.
Take away their crutches.
Bezos all but banned such presentations at Amazon around the time Edward Tufte, a computer science professor at Yale, wrote an essay saying that their bullet points encouraged lazy thinking. Amazon employees are required to write papers, known as “narratives,” that are no longer than six pages.

The idea for Bezos, former employees say, is that the act of writing forces people to focus their thoughts and think them through.
So Bezos has been about writing. Writing, marketing, efficiency... Okay. Show us the newspaper.

And stop blocking the view. Tear down that wall.


Hari said...

"And anyway, Bezos already has so much money that he doesn't need to use WaPo to get more money."

"At some point, you've made enough money," huh?

TomHynes said...

Control Shift N on your chrome browser and open up an incognito (porn) window. I read the NY Times, the LA Times, and the Washington Post this way. Never porn.

Tari said...

The paywall seems to be the antitheses of the concept behind Amazon. Amazon has always seemed to me to be about removing barriers to getting people what they want. Want to shop in your PJs? Sure. What to pay shipping just once a year and not worry about it? Okay. Etc, etc. Doling out information for a fee doesn't match that model.

David said...

One of the big differences between Amazon and other companies is that Amazon expressly focuses on maximizing free cash flow rather than income. (The difference, oversimplified, is that cash flow equals profit plus depreciation minus capital expenditures.)

Using that template to look at the Post is interesting. The Post Co.'s financials don't break out FCF from the paper alone, but they suggest that the paper throws off a lot of cash, which makes sense given that it has a very large asset base (printing plants, offices, real estate, trucks, etc.) that isn't growing. So depreciation is large and capital expenditures are small, leaving FCF much higher than revenue.

This suggests that Bezos is not planning on revitalizing the hard-copy paper, but in milking it until it makes sense to stop printing -- which won't happen until he can replace the cash flow from selling hard-copy papers. At the same time, he'll probably move much more strongly into digital (no surprise there) and, just as Amazon does, look for multiple ways to charge for the same asset. This also suggests that the pay-wall isn't going away immediately (as it's a source of cash-flow) but that over time something else will take its place (maybe something similar to Amazon Prime, where a one-time payment gets access to the paper plus).

What the plus is, is the big question.

Insufficiently Sensitive said...

Love that writing of proposals, particularly the press release and the limited space. Any urban 'intellectual' can cover the corpses of a whole grove of trees with tendentious blather, but limit 'em to a half-page for the executive summary and five for the supporting evidence.

traditionalguy said...

The WaPo digital app could become the world's largest Amazon Portal. That will make it profitable of sorts.

Bezos' rude approach to ending repetitive talkers after their second re-hash is pure common sense. That trait alone makes Bezos into a dangerous man. Which also makes him a very sexist man. Women will be effectively excluded.

Farmer said...

‪Hari said..."And anyway, Bezos already has so much money that he doesn't need to use WaPo to get more money."

"At some point, you've made enough money," huh?

Hari, check this out, because this is a good example of how Althouse blogs, and how a lot of people miss the points she’s making and misunderstand what she’s trying to do.

Click the Bezos tag at the bottom of the post, and go find the first one, from three days ago.

At the bottom Althouse inserts an addendum:

ADDED: It seems as though the Bezos idea should be to forget about making money — like Citizen Kane — and simply plunge into making a great newspaper. Bezos doesn't need to make money. He can be simply spending money. Do what is good! What else should he do at this point? And even when Amazon was being developed, the need to make money soon was considered a distraction, if I remember correctly. He had the nerve to put that off way into the future. Here's the "Citizen Kane" scene this makes me think of: (here she inserts the video clip)

Then she quotes from the clip: "You're right, I did lose a million dollars last year. I expect to lose a million dollars this year. I expect to lose a million dollars next year. You know, Mr. Thatcher, at the rate of a million dollars a year, I'll have to close this place in... 60 years."

So what happened today? Althouse blogs, “And anyway, Bezos already has so much money that he doesn't need to use WaPo to get more money."

She's referring to the idea she began thinking about the other day in the first post. She’s saying that if Bezos were to take the Charles Foster Kane approach to running a newspaper, this would be his attitude. She’s not wagging her finger at him for being too rich. She’s continuing with her hypothetical: “Here’s how this guy will think if he’s going to run the Post with the same attitude he runs Amazon.” She’s thinking out loud about an interesting situation. It has nothing to do with Obama, the GOP or even money, really. It's a rumination on how an innovative owner of a successful “new” company would or could resuscitate a dying behemoth. And keeping a paywall in place seems like a dumb, old media sort of thing to do that will stunt the long-term growth of the paper even if it makes some money short-term. So: “Forget about the money! Innovate! Zag when everyone else zigs!”

That’s how Althouse blogs.

Carol said...

I dunno, this all seems like totally self-serving "lemme see for free it because I wanna" with no legit justification. It's their property, let them wall it off, go read something else. It may be bad business judgement on their part, but I'm not a stockholder so I don't care.

Newspapers aren't public utilities. Or does this supposedly have to do with their "elite" status as media?

Farmer said...

Hey, I tried.

eddie willers said...

Hey, I tried.

Forget it, Farmer.....its Chinatown.

PeterK said...

I used to live in Virginia and thus was a subscriber. but because I'm now in Texas I am no longer a subscriber and I can't access any WaPo articles at all. I get a popup demanding I resubscribe.sorry I won't do it