Donald Graham details Post sale to Jeff Bezos

Donald Graham, the Post Co. chairman and chief executive, explains why he came to believe that Amazon founder Jeff Bezos offers the Post the best chance to thrive after 80 years of Graham family ownership. (The Washington Post)
August 6, 2013

Washington Post Co. chairman and chief executive Donald Graham joined Brook Silva-Braga on PostTV’s The Fold Monday to discuss the details beind the sale of the paper to Amazon.com’s Jeff Bezos. A transcript of the interview follows.

BSB: The Washington Post has been sold to Amazon founder Jeff Bezos. The announcement was a surprise. Donald Graham the CEO and Chairman of The Washington Post Company gave the news to staffers Monday afternoon. Now joins us to discuss the deal and his family’s legacy. Thanks so much for joining us.

DG: Of course, Brook, I’m glad to.

BSB: I wanna talk about the deal. But first you were born into this paper in this company. You’ve spent your whole life with this company. This had to be an emotional day for you.

DG: Yeah, almost the first thing I remember was driving down to the Post building and watching Harry Truman’s inaugural parade in I guess January 1949 and, uh, uh, watching from my Dad’s office. The Post building then fronted Pennsylvania Avenue. And, uh, one thing I remember there was, there were lots of tanks. My sis-… my sister and I would have been, uh, would have been watching.

BSB: And your-your son Will is standing here. I asked him what-what this meant for him, how he felt. He just, he used the word sad.

DG: Well I think every Graham, not only every Graham, but everybody at the top of The Washington Post Company had the same reaction when we first started to think about the possibility, which was great surprise, sadness. But the reason we started to think about it, Brook, is the point of our family’s ownership and we were brought up to understand this was always supposed to be that it was good for the Post. And as last year ended, I sat down with, uh, the publisher of the Post, Katharine Weymouth, who is also Katharine Graham’s granddaughter and the daughter of my stalwart sister Lally whose story from Egypt led the Post on Sunday.

BSB: Yeah.

DG: And Katharine and I started to look at the numbers, realized that this year 2013 would be the seventh straight year of significant declining revenues. We knew we could keep the Post alive. We knew it could survive. But our wish, our aspirations for the Post have always been highered by that, so we went to see if we could find a buyer. We were represented by an investment bank called Alan Company. Their people had two early conversations with Jeff who surprised me by expressing quite a bit of interest but then stopped, and then stopped talking to the Alan Company people.

BSB: And when was that? When did you first have contact with Bezos?

DG: Ah, it was in the first half, it was I would guess March or April this year, but I don’t honestly know.

BSB: Okay. But just a few months ago. This all happened pretty quickly, it all happened in secret.

DG: But, uh, well a few months, a few months ago, but this is kind of interesti-… I thi-… I find this both interesting and important. Jeff, uh, Jeff had those conversations and then there was a pause in the conversations for two months. And I thought he had simply terminated the conversations, but it turned out he was thinking about it. And Jeff’s a very analytical person and I’m sure he was looking over numbers and wondering whether he thought he could make the business succeed. Jeff then reached out to me less than a month ago. We met at a conference face to face twice the second week in July. We spent an hour together. He asked to for time to study the numbers. We then spent another two hours together. And at the end of it, he said that he thought he wanted to go ahead. But he obviously he and his team needed time to really look over the business and understand it more thoroughly. Um, and then we-we, he did and we quickly reached a deal.

BSB: Was his the highest offer?

DG: Um, his, yes, his was the highest offer and the one we accepted. We did talk to other people. There’s not a great number of other people, uh, certainly less than a dozen. But it’s pretty obvious that Jeff Bezos has a certain strength when it comes to the future of news. You know, when you think about that growing and growing and growing digital and mobile audience, Jeff knows a lot about that. He knows how to reach people and he knows how to establish commercial relationships with advertisers and others. And that, uh, it’s not that he’s gonna walk in with a pre-packaged solution to the problems of the newspaper business. He is absolutely not, but he didn’t do this impulsively. He did this after thinking for a couple of months. And I believe he will do just what he says in his message to employees, come in, experiment and see what works.

BSB: Is he buying the paper to turn a profit or because of some of the other intangible things that the paper can do?

DG: I hope to hell he turns a big profit, but that’s not why he’s buying it. He had many, uh, more profitable companies he could have bought. Many more, uh, many investments where the return would be greater. The one thing about Jeff is that everybody knows he is very, very long term minded and he’s shown it in his management of Amazon and in for instance the invention of the Kindle, which was not a moneymaker for years and years, but became big and became, uh, successful. So, um, no, he’s, I-I hope the Post makes a tremendous amount of money for Jeff’s sake and for the sake of everybody else who works here. But, uh, will Jeff and the team here and Jeff has offered job, Jeff has offered, has said that the team will, the Post will continue to operate under the management of the editor, the publisher, and everybody else who’s here today.

BSB: Is that indefinitely or for a certain amount of time?

DG: By contract it’s for a year that, uh, Jeff, uh, that everybody is, well the, you could read the contract because we’ve posted it on, uh, on the SEC site.

BSB: A lot of people are using this as a-a chance to make grand pronouncements about the newspaper business. I wanna give you a chance to kind of give your analysis of what this says about the future of journalism, the future of print journalism. Does this mean newspapers are loss leaders for bigger organizations and family ownership doesn’t make as much sense? What should we take out of this?

DG: Well I’ve never, um, I’ve never been one for grand pronouncements and I don’t have one today. I think…

BSB: Oh come on, help me out.

DG: I think that, uh, um, everybody knows that newspapers have to change. We have been changing. Your very presence here on this set is, uh, is evidence of that. But we are going to, uh, we’re gonna be guided by somebody Warren Buffet has called in his opinion the best CEO in the United States. Somebody who is a good technologist himself, but who knows so many other great technologists, knows who can, who is best to work on certain problems. He’ll decide thoughtfully what are the best steps for the Post including-including but not limited to digital steps. I would, I would bet on Jeff to become a little bit interested in the old fashioned print newspaper business. But we will, uh, we will become a place that does its traditional job, maintains its traditional values, but tries things and I hope a lot of them will succeed.

BSB: A couple last quick things. Does this affect the pay wall at all?

DG: Oh no. I mean, Jeff has said, management will continue, policies will continue. It is, it will be up to Jeff when the transaction closes, which won’t be for at least a couple of months, around a couple of months, but he’ll decide what policies to pursue. But he-he is not, he is not telling me that he wants to change any policies.

BSB: The Graham Family will own the paper for I guess 60 more days.

DG: Well-well that-that remains to be determined. We’ve-we’ve got a binding contract with Jeff. Now we will reach a definitive agreement. I’m talking lawyer talk here too.

BSB: Yeah.

DG: That-that, uh, will be around 60 days, maybe a little more, maybe a little less.

BSB: And I’m trying to not a lawyerly moment, trying to lead you into more introspective moment.

DG: Yeah.

BSB: Of what about after the sale goes through? Have you thought about what you will do, how you will feel?

DG: After the sale goes through…

BSB: What-what you will step back and say from 1933 to 2013, our family owned this paper and it did good and great things with it and we’re proud of that and we look back on that era and think and say and feel what?

DG: Well you said that very well. I’m gonna have to have you do interviews for me. [LAUGH] But, uh, the, no, we-we, uh, uh, I have spent 42 years of my life working in this building, basically all my working career. Uh, and I love this place and I’m really devoted to its future and its success.

BSB: Did you think of your Mom today?

DG: I certainly did. And I think so did everybody in that room. Uh, for sure.

BSB: And what were you thinking of?

DG: Well I-I thought a lot about, uh, the history of this place. I ca-… uh, I came to work here in the year when the Supreme, when we printed stories based on the Pentagon Papers and the Supreme Court made that decision. The following year was the year of Watergate. And I have been here for great achievements and great times and some that weren’t so great. But I think to, I ho-… I-I believe that today’s, uh, uh, what happened today, today’s events mean that the Po-… as I said, it definitely means the Post is gonna be a very, very exciting place to work and to read. And I hope it means that there are decades of more great papers and great achievements and great news products, news, uh, that this is the great, you know, the, it gives us a chance to be a very special news organization of the future.

BSB: Thank you much for your time.

DG: Thanks, Brook.

BSB: And obviously your leadership on behalf of the rest of the newsroom.

DG: Thank you, Brook.

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