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Bezos and Newspapers

by bdietrich on August 7, 2013

When the web revolution got rolling, the communication technology seemed so mysteriously invisible that comedians joked about “finding” the Internet. Where was this new thing upending the economy?

Well, I’ve spotted it, in the form of Amazon office buildings towering over the once-dominant headquarters of my old employer, the Seattle Times. The newspaper has not only been metaphorically overshadowed by Net commerce that killed print classified advertising, but physically as well.

Amazon already owns or leases at least 2.7 million square feet in Seattle and has plans for 3.3 million more. Globally, it is up to around 100,000 employees.

The Times, once a minor land baron in Seattle, recently announced the sale of its final properties in town. The Art Deco headquarters I worked in is empty, awaiting redevelopment, and a newsroom half its former size is housed in a neighboring building that was once a furniture store.

Now Jeff Bezos, the billionaire visionary who built Amazon, has bought the Washington Post for $250 million.

I see this as potentially good news. If anyone can figure out how to make newspapers work, it should be the man who has invented the new Sears Roebuck. What if he can bring to newspaper websites the magic that makes Amazon the easiest place ever to go shopping?

I also see this as bad news. Bezos is on his way to becoming the most powerful monopolist since Bill Gates, or, going back, John D. Rockefeller. No one has assaulted old-model brick and mortar business so effectively since Genghis Kahn. Now he owns the dominant newspaper in the nation’s capital?

I’ve only met Bezos once, at a book event, and he was polite but distant, which you probably have to be when a billionaire. Reports are that he is quite engaging amid his own kind.

He’s clearly a genius, but enigmatic politically. He hasn’t plunged much into broader civic issues in Seattle or social issues nationally. He somehow persuaded the Justice Department to take Amazon’s side in a pricing-and-control battle with publishers, and given newbie authors a self-publishing outlet while squeezing veterans accustomed to the old print model.

He’ll go down in history as admired and controversial as Gates, Ford, Rockefeller, and Carnegie. I benefit from Amazon sales of my books, but also feel the negative effect of traditional bookstores under siege. My rural county has lost one chain bookstore and one independent bookstore the last decade and doesn’t have a bookstore in three of its four major cities.

Unless you count Costco and its handful of titles.

Once upon a time, back in the 1950s and 1960s, book publishing was small (a few tens of thousands of titles per year), cozy, and authors were somewhat rarified celebrities.

Today’s statistics are all over the map, but UNESCO counted 329,259 American books published in 2010. Unclear is whether the 235,000 self-published books that year are included in that number, but Amazon accounted for 39 percent of them. It paid authors up to 70 percent royalties for bargain-priced titles, compared to 15 percent from traditional houses for pricier books.

More authors, more books, and a roughly similar-sized financial pie split more ways, with a few literary winners and many more relative losers. The trend has been to turn authors into “content providers” for content-delivery systems like Amazon, which garner the real rewards. Most authors get vanishingly small sales and compensation, but Amazon farms them by the hundreds of thousands. Traditional publishers remain under siege, instead of being courted as partners.

Entrenched, well-known names that have become “brands” tend to continue to have an enormous advantage. Stephen King has dominated bestseller lists for forty years. Yet “Fifty Shades of Gray” shows how new names can occasionally benefit from web word of mouth. Or type.

Amazon has experimented with its own publishing, without dramatic success. But it is influencing what and how we read.

In the past, physical space limited how many authors a bookstore could stock. Now there is no limit to listing all of the 130 million book titles that Google estimates are out there in the world.

Some commentators view the publishing world as irretrievably broken and on the verge of collapse, with an end to discrimination and editing that lifted deserving books above the pack.

Others see the democratization of publishing as flooding the marketplace with new fire and brio.

To which I say, Yes.

So it’s a Brave New World. When I started at my first newspaper, the Bellingham Herald in 1972, it was still using lead type. My first college job was unsnarling wire service ticker tape. Our cutting edge was replacing manual typewriters with IBM Selectrics.

The newspaper industry I joined was still powerful and monopolistic enough to feel like a utility. Reporters had power. The audience was big, despite radio and television competition. There was no cable. No choice.

All that is Gone With the Wind. If the Washington Post is worth $250 million, I assume the Seattle Times would be lucky to sell for ten percent of the billion dollars it was briefly valued at more than a decade ago. Probably far less.

So what is Bezos up to? One theory is that this is an easy buy with chump change to allow him to experiment and influence.

Another is that he has some ideas to truly save newspapers.

I still subscribe to and prefer the paper product, out of long habit. But I expect it to disappear. Newspaper websites, meanwhile, lag well behind Amazon in slickness and ease of use. But they only have a handful of people designing them, while Amazon has thousands.

What Bezos might be able to do is increase the usefulness of newspaper websites exponentially be linking information. One story would be accompanied by referrals to others in the archives, without requiring a tedious search. A click would call up pictures, maps, charts, and historical timelines. Each jump would bring up a pop-up ad or, better yet, an ad with consumer reviews, expert analyses, and on and on. Then links to relevant books. Television shows. Movies. A newspaper web page would become the preferred home page for consumers.

Information, after all, is an infinite as book titles. If Bezos can make its navigation easy, people will come. But can he afford the labor to tap it from meager newspaper revenues? We’ll see.

What will all this do to individual writers and our income? I don’t know. But for two decades now the ice has been cracking beneath my feet and I’m jumping from ice floe to ice floe amid the Revolution, with a furious mixture of success and frustration.

To quote the old song, I keep on hanging on.

While wondering why I didn’t think of Amazon’s business model myself.

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