Yes, it’s Jeff Bezos, strange visitor from another industry who came to newspapers with power and abilities far beyond those of mortal media owners. Jeff Bezos…who can change the course of mighty industries, make money with his bare hands, and who, disguised as Publisher Jeffrey Bezos, mild-mannered leader of a great metropolitan newspaper, will fight a never-ending battle for truth, profits and the American way.
I have recently come to the conclusion that I was wrong in an earlier post. There actually wasn’t anything the newspapers could have done to meaningfully change their current situation. My reason is that, even if they had hired the sharpest new media tech guys, the mere fact that sites featuring classifieds, want ads, car sales, real estate and entertainment ads were going to start up, spelled their doom.
Because newspapers had been able to sustain monopoly pricing in those areas for so long, which supported their journalism hobby, they were vulnerable to anything that offered a lower cost alternative. As a result, the rates for those advertising vehicles, which together made up typically 80% of a newspaper’s profits were bound to take a dive.
So even though I still believe that newspapers didn’t know what business they were in – they thought they were in the news business, but were actually in the classified ad business – I no longer think they could have done much to save themselves.
I’m hoping that Jeff Bezos at the Washington Post can prove me wrong still again. Amazon’s relentless focus on the customer is so encouraging, I would tend to bet on Bezos. Even as other famous customer-or-product focused companies like Apple are being accused of losing the Steve Jobs passion for excellence, Amazon has not wavered. It continues to chug along, providing an outstanding customer experience and valuable innovation.
If Bezos manages to pull it out – and he has the resources to keep at it for a long time – then we’ll look at what he’s accomplished and say, “Ahah. That’s what newspapers should have done.”
Of course it’s possible that what they should have done is find themselves a Jeff Bezos. Or a John Henry. Or a Mike Bloomberg. (NY Times give him a shot – he’s going to need a job soon.)
Update: This study from the Social Science Research Network underscores what I said above. It estimates that Craigslist cost newspapers $5 billion between 2000-2007. There’s nothing newspapers could have done about this.