Does it matter that Bezos won’t move to D.C.?

 

I won’t be leading The Washington Post day-to-day. I am happily living in “the other Washington” where I have a day job that I love.

It is, admittedly, an odd connection to draw. But when Jeff Bezos, founder of the online retail colossus Amazon, said he wouldn’t leave Seattle to take up residency in the hometown of the legendary newspaper he had just bought, I thought of the final scene of “Raiders of the Lost Ark.” That’s when the ark, whose immense power had been so fiercely sought for the entire movie, is trundled on a forklift into a warehouse, fittingly enough, in Washington. And the camera pulls back to reveal the vastness of the cavernous space where it’ll be kept and, apparently, abandoned—its might untapped and unrecognized.

Of course, The Post isn’t being abandoned. Although Bezos probably won’t stick to his initial pronouncements about leaving its management intact—transformational business tycoons usually have their own ideas about leadership—for now it’s a safe bet that the Post will remain an energetic, gutsy and fully engaged news organization.

But to me, as somebody who grew up in Washington and who broke into the news business in the Post’s shadow during Watergate, the very idea that the paper’s proprietor wouldn’t be thrilled to take the throne that comes with the title is more telling and more poignant than any other element of the story.

In a way, the Bezos case offers the mirror image of the flap over the possible purchase by the billionaire Koch brothers of media heavyweight Tribune Co. There, the brothers’ ideological ambitions were thought to be driving their interest, with their supposed wish to see a stronger libertarian cast to news coverage  drawing them to an investment that had meager financial appeal.

There, whether people were cheered or appalled by the possible Koch takeover, they agreed that the acquisition mattered—not so much because it might infuse money or managerial smarts into an ailing company, but because it could have an impact on the public sphere, on policy talk, on civic discourse. With news proprietorship comes a seat at the grownups’ table. That’s the deal.

Bezos may not want to sit at the table, but that seems unlikely in view of the extraordinary impact his company is having on global retail—the adoring takeout in the current issue of Fast Company magazine is an eye-opener in laying out the breadth of Amazon’s revolutionary impact on the way goods are sold worldwide.

Indeed, there’s nothing in his past to suggest that Bezos would shy away from wielding influence. The more disquieting possibility is that he doesn’t think being an absentee owner of The Washington Post would mean he’s giving up any. Continue reading “Does it matter that Bezos won’t move to D.C.?”

Why search giant Google is buying Motorola

For all its claims to transparency, the world of Internet media is so layered with mystery that figuring out something as straightforward as a big corporate takeover, where strategies are usually clear, is like trying to break a code written in an obscure foreign language.

Case in point is the Google-Motorola deal. Google, the reigning online colossus, is buying Motorola Mobility, the legendary consumer electronics company that now makes mobile phones and TV set-top boxes.

At $12.5 billion, it’s a sizable purchase, even for a lushly cash-rich company like Google, which has $39 billion in its sock drawer.  It will double Google’s workforce. But what’s impressive isn’t the size of the deal. It’s the purpose behind it, which seems, at first glance, inscrutable.

Google, after all, makes its money from search. Mainly, it auctions off search words to corporate clients that want to advertise alongside the responses Google delivers to online queries related to things they peddle. It’s a sweet business. Google made $3 billion last quarter on revenue of $9 billion.

Motorola Mobility, on the other hand, sells handsets and is the No. 2 provider—after Cisco—of the set-top boxes that cable operators rent to subscribers to carry TV channels into their homes.

So, what does one thing have to do with the other? Why is an extravagantly successful service company, the darling of Internet users worldwide, buying into the hardware business, where competition is fierce and margins are low? Why does a search-based behemoth want to spend billions on cell phones and cable boxes?

There are several answers, which together provide a glimpse of the swirling changes in the new media economy, and some disquieting clues as to how some Continue reading “Why search giant Google is buying Motorola”