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A Surprising Trend: The Sale of The Washington Post

by James Wu

August 7, 2013

Right after touching the screen and selecting Washington Post from the bookmark menu, there it was, the surprising news of that day: the Washington Post had been sold for $250 millions.

It was once said that the railroad tycoons went out of business because they thought they were in the monopoly railway business, not realizing that actually they were in the transportation business. It is puzzling why so many traditional newspaper companies have not been able to adapt to the simple change of platform from paper to electronic devices. In the digital age of the Internet and the mobile devices, potentially everyone could become a reader of Washington Post's content. The readership is growing and it may grow exponentially. It is the paper subscription that is shrinking. If a digital news site is highly popular, it may not need subscriptions to grow the business.

It seems that Mr. Bezos made an incisive business decision to purchase The Post. With the rather successful Kindle, the new owner of the Washington Post probably thinks he can turn every Kindle owner into a reader of The Post. Moreover, if Amazon can make Kindle the best mobile device for reading the news, it may increase Kindle's market share of the tablet users.

Two trends are forming among the news consumers. First, the tablets are becoming the platform for reading the news. Second, the smart phones are becoming the mobile platform for watching the news. When there are more competitions and less subscribers, raising the price for an issue of the newspaper is not the answer; but many newspaper companies did just that.

 

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