My father used to say that there are two kinds of people in the world: those who do what they say they are going to do, and everybody else. I thought of that maxim when I heard that the Graham family was selling the Washington Post to Jeff Bezos, the chief executive officer of Amazon.com Inc.
When Amazon went public in 1997, Bezos was the frontman, evangelizing his vision of not only the world’s biggest bookstore but also the world’s dominant retailer. This, from the CEO of a company that was losing money hand over fist and had sold its first book 22 months earlier. Even amid the frothiness of the time, this seemed a bit beyond the pale. I remember thinking some variant of YRW: “yeah, right, whatever.”
Shows what I know. In less than a generation, Amazon has become the world’s second-most-valuable retailer as well as a cultural phenomenon that touches almost every corner of our online experience. Somewhere along the way, I capitulated. This is clearly a guy who does what he says.
So as a venture capitalist with a public-service-journalism habit, I am considerably cheered by the Grahams’ choice of Bezos as a buyer. He says that he will honor the Post’s values (presumably and primarily, journalism over profit) and put the reader first. To the casual observer, these may sound like throwaway lines. But if he really means them, they are anything but.
The big problem with public companies owning newspapers is that their leaders can’t credibly commit to putting the reader first by valuing journalism over profit. As fiduciaries, executives of public companies owe their loyalty to shareholders, not readers, which means focusing on value maximization, not values.
These well-intentioned souls often mutter some version of “it’s complicated,” but it really isn’t.
I’m a member of a group that believes that much of what journalism organizations such as the Post provide is a public good -- another way of saying that such journalism can’t reliably pay for itself and represents a failure of free markets.
I’d wager that the Grahams agree. And I would bet that they courageously sold to Bezos not only because they know him well but also because he recognizes a market failure when he sees one.
Let’s take Bezos at his word and assume that he will seek to maximize the Post’s societal impact rather than his return on investment. Although that may not constitute philanthropy per se, it’s a strong statement of his public-service priorities. My fervent wish is that other business leaders will follow his example. And for those who can’t afford to buy the whole enterprise and run it in the public trust, favoring nonprofit news organizations with their philanthropy serves the purpose as well.
In the words of the Atlantic’s James Fallows, perhaps this marks “the beginning of a phase in which this Gilded Age’s major beneficiaries re-invest in the infrastructure of our public intelligence.” Wouldn’t that be something? Given the well-documented travails of the business of journalism, it’s an infrastructure with considerable deferred maintenance.
(John Thornton is founder of the Texas Tribune and general partner at Austin Ventures LP.)
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