Bezos Is Not Saving Journalism, He's Saving Amazon

TheStreet.com

NEW YORK (TheStreet) -- "About one thing I am certain: In 20 years there will be no more printed newspapers. If they do exist, they will be considered a luxury item for certain hotels to offer as an extravagant service for their guests. Printed newspapers will no longer be normal in 20 years."

Those were the words of Jeff Bezos while speaking to German paper Berliner-Zeitung.

So it came as a surprise when it was announced Monday that Amazon.com's founder and longtime CEO was buying The Washington Post, a money-losing newspaper company, from Washington Post Co. for $250 million. Monday's press release said the Bezos-fronted entity acquiring the properties is not Amazon.com and that Bezos is making the purchase "in his individual capacity."

That's all well and good. And I want to take the press release at face value. But who are we kidding here?

There are many theories as to why Bezos would risk what amounts to only a small fraction of his wealth to buy the Post. The most popular opinion is that Bezos, by the kindness of his heart, somehow "wants to save journalism." Well, "journalism" doesn't necessarily reside exclusively in newspapers. If that were the case, Bezos could have founded a journalism school for much less, or he could have simply made a sizable donation to one.

Buying the Washington Post, as shrewd of a move as I have ever seen, is about power and influence. Let's not forget that for his $250 million, Bezos also gets other assets such as Southern Maryland newspaper groups, Fairfax County Times and El Tiempo Latino. He's also buying the Express newspaper, the Gazette and Greater Washington Publishing. Bezos, a brilliant mind by many standards, also understands the political pressures Amazon has been under.

Bezos sees how rivals like Wal-Mart gets killed in the press for a host of issues from disputes over low wages, killing off "mom and pop shops," to sourcing products from China. Wal-Mart, despite all of the good the company does, has never been able to catch a break. Amazon, meanwhile, has always gotten "pass" from the media. This is even though Amazon has employed similar sales tactics as Wal-Mart.

Do you suppose that Bezos feels bad about crushing family-owned bookstores? Does anyone care about the fates of former rivals like Borders, Dalton's, Media Play and several others that were killed off by Amazon's online/e-books concept? Even Best Buy -- though it is still breathing -- is hanging on by a thread. Much of the carnage that Amazon has left behind can also be linked to the fact that Amazon hasn't exactly been a great corporate citizen. Let's just get that out of the way.

In the interest of full disclosure: I'm a frequent shopper at Amazon and I love it. I want to make this clear. But I also understand that one of Amazon's advantages is that Amazon pays minimal property tax and no sales tax. I don't believe that Amazon could save its customers so much money without this benefit. While it's great that we get awesome deals and free shipping, where's the outcry for the fact that our states are cheated out of much-needed revenue? Yet, we complain when our local taxes go up. Do you suppose that perhaps Amazon should be on the hook for some of that? Where's the media?

Along those lines, it was only Apple's name being smeared through the media in a "price-fixing" conspiracy for the e-books market, which was said to have "caused harm" to the likes of Barnes & Noble . Amazon, meanwhile, though linked to the conspiracy, received another pass. Before you send your "he's being paid to bash Amazon" emails, let me point out that I'm not blaming Amazon for any of this.

Nor do I believe that the media's love affair with this company is Bezos' fault. But let's not pretend that Amazon is a saint and everyone else is evil. I don't believe for a second that there is any "humanitarian cause" to Bezos buying the Washington Post. Rather, this move has everything to do with preserving Amazon's retail and media empire.

There's no denying that Bezos' vision of what Amazon would become has been realized. But now, he's about to own a portion of the press. Let's recall, in his other vision last November, he told the German paper that "newspapers would be dead in 20 years." I expect that he'll be right about that as well.

But until then, he's going to use it to save Amazon, which clearly didn't need "saving" in the first place. But I don't expect that we'll see many "Amazon should pay taxes" articles from the Post any time soon.

At the time of publication, the author was long AAPL.

This article was written by an independent contributor, separate from TheStreet's regular news coverage.

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