Ghosts in the Newsroom – Vanity Fair
A tale of missed opportunities, identity crises and disruptive technology. These challenges are far from limited to The Post, but seem more acute with one of the most important American newspapers. Some excerpts:
Warren Buffet, an significant investor in the paper:
And, as Buffett sees it, the newspaper’s journalists never understood that fundamental reality. “The Washington Post is a local newspaper,” Buffett said flatly. “I mean, it has national reach, but the grocers that advertise in it, they’re not going to get national customers. The circulation they’re paying for is the circulation that goes to people in the Greater Washington, D.C., area, and that’s way different than The New York Times. One of the things that’s existed over time which I’m sure you’re aware of is that the newsroom, kindled by what happened in Watergate, liked to think of themselves as national. And they are national in an important respect, but they’re not national as a business. And they don’t have a business model that works nationally. What they do have as a business asset is a large and prosperous local market.”
Craigslist has been extremely disruptive to the newspaper business model:
Meanwhile, the Post was facing the same challenge to its business model that every big newspaper did, as advertisers turned away from print. The advent of online services, such as Craigslist, was eroding the Post’s lucrative classified sections, which in the 1990s contributed as much as 40 percent of the paper’s total revenue and today contribute less than half of that.
On Kaplan, the success of which offset news losses for nearly a decade:
There was, for a time, a bright spot. In 1984, when presented with the prospect of acquiring a small company called Kaplan Test Prep, Katharine Graham was unenthusiastic. “I confess that my lack of interest was reflected in my saying, ‘I don’t give a shit about it, but if you think it will be profitable, let’s do it,’ ” she wrote in her memoir. Kaplan warranted only a short paragraph, but it came to represent the most promising, and then the most dangerous, business division within the Washington Post Company…
…Then, with little warning, Kaplan’s biggest division, Kaplan Higher Education, became an embarrassment, and its business went through the floor. In 2010, Kaplan was caught in a government sting that revealed the division’s employees pushing students to take on loans even if they couldn’t afford them. That same year, Steve Eisman, the short-seller central to Michael Lewis’s account of the financial crisis, The Big Short, gave a speech called “Subprime Goes to College” that was widely discussed among for-profit executives and investors. Eisman described the for-profit education companies as loan sharks preying on disadvantaged students who would soon find themselves deep in debt.
Oh and the newsroom culture is still conflicted over national and local, digital innovation feel short and the legacy of the past looms over everything.