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Romenesko: Bezos buys Washington Post for $250 million

Discussion in 'Journalism topics only' started by Moderator1, Aug 5, 2013.

Page 8 of 10
  1. Dick Whitman

    Dick Whitman Well-Known Member

    Said better than I said it:

    http://www.nytimes.com/2013/08/11/opinion/sunday/douthat-how-the-post-was-lost.html?hp&_r=0

    Today ... it’s Politico rather than The Post that dominates the D.C. conversation, Politico rather than The Post that’s the must-read for Beltway professionals and politics junkies everywhere. ... Politico has claimed a big part of the audience that The Post needed in order to thrive in the world the Internet has made.

    I’m skeptical of the various theories about how The Post’s new genius owner might invent some new way to deliver content or bundle news or otherwise achieve a profitable synergy between his newspaper and Amazon. ... (I)t’s more likely that the best thing Jeff Bezos can offer his paper is more old-fashioned: the money and resources necessary to take back territory lost to a sharp-elbowed competitor.

    What Bezos can deliver, in other words, is a newspaper war, with clear and pressing stakes. For The Post to thrive again, Politico must lose.
     
    Dick Whitman, Aug 11, 2013
    #85
  2. H.L. Mencken

    H.L. Mencken Member

    I'm all for that.
     
    H.L. Mencken, Aug 11, 2013
    #86
  3. Songbird

    Songbird Well-Known Member

    Politico.com is worth $3 million. http://www.siteprice.org/website-worth/www.politico.com

    Bezos should just buy the whole operation and give it prominent space at WaPo.com like the NYT did with Silver's 538.
     
    Songbird, Aug 11, 2013
    #87
  4. The Big Ragu

    The Big Ragu Moderator Staff Member

    Sorry, Xan, but that is just silly.

    Politico is worth significantly more than $3 million by any measure of valuing it.

    I've seen estimates that Politico does at least $20 million in revenue a year now. It has steadily grown since it launched, and even though there is no way to know for sure because of the way Allbritton reports, I wouldn't be surprised if Politico isn't far from $3 million in profits a year.

    Even at a modest say 2X revenues, it would be worth at least $40 million. Of course they would never sell it that cheap. AOL bought the Huffington Post for 5X revenues two years ago -- $315 million. Depending on how much someone wanted Politico, it could even be valued at 6 or 7 times revenues in a sale.
     
    The Big Ragu, Aug 11, 2013
    #88
  5. Alma

    Alma Well-Known Member

    Alma, Aug 11, 2013
    #89
  6. FileNotFound

    FileNotFound Well-Known Member

    FileNotFound, Aug 11, 2013
    #90
  7. Michael_ Gee

    Michael_ Gee Well-Known Member

    Most of Politico's revenues, oddly enough, come from its little-known print edition. Institutional ads bought by K Street and its clients as part of their overall lobbying budgets.
     
    Michael_ Gee, Aug 11, 2013
    #91
  8. Songbird

    Songbird Well-Known Member

    Point is, if you can't beat them, buy them.
     
    Songbird, Aug 11, 2013
    #92
  9. JayFarrar

    JayFarrar Well-Known Member

    The people who own Politico just sold their TV operations for nearly a billion dollars.

    The asking price for Politico would likely be more than what Bezos paid for the Post.

    I think many people, given the number of former Posties in Politico's operation, have conflated the different operations into one thing in their minds.

    I think that was especially true early on.

    Regardless, people want easy. Type in google, and click the first link. Politico and Huffington have mastered that SEO rigging.

    It wouldn't take much to knock them out of that top of the search engine spot.

    The Post's news operations need to be more aggressive in getting reporters, columnists and editors booked on the various news shows.

    That might be because the TV friendly faces have fled to places like Politico but that can be corrected by throwing more money at them to get them back to the fold.
     
    JayFarrar, Aug 11, 2013
    #93
  10. HejiraHenry

    HejiraHenry Well-Known Member

    One thing that intrigues me is the possibility that guys like John Henry and Jeff Bezos have the resources that they can afford to set up their estates so that the newspapers could remain independent after their deaths.

    Employee ownership, perhaps, or more likely a non-profit structure would preserve the paper without the need to involve another set of investors. Worth a thought.
     
    HejiraHenry, Aug 12, 2013
    #94
  11. wicked

    wicked Well-Known Member

    Henry is talking about taking on other investors, so I don't think that's his end game.
     
    wicked, Aug 12, 2013
    #95
  12. The Big Ragu

    The Big Ragu Moderator Staff Member

    I am not sure if this is the case anymore. It's hard to know exactly how much revenue it is pulling, and where it comes from, because Allbritton moved the equity into a family-owned trust and it doesn't make it to its 10-K. But I would reasonably guess that was the case early on, but as the site has grown, its online ad revenue has become the main source of its revenue. It's also safe to assume that it is well profitable now. It may not be too far away from earning $3 million a year, which is what makes the notion that the whole operations are worth only $3 million kind of nuts. Assuming that $20 million in revenue is a conservative estimate, and that the cachet it has accumulated would dictate at least 5X revenue, the starting point at valuing the company would be $100 million. As with Bezos and the Wash Post, though, the worth of something isn't the price tag passive observers slap on it. It's what someone is willing to pay. I'd guess -- based on how other sites are getting valued -- Politico would get at least 6 or 7 times revenues, and based on its revenue growth -- and again, how other fast-growing websites have been valued and/or sold -- 20 times revenues or more wouldn't raise eyebrows. In that scenario, if they were thinking about selling Politico, I'd suspect they could find a buyer who would pay betwen $400 and $500 million.
     
    The Big Ragu, Aug 12, 2013
    #96
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