Jeff Bezos and the Real Cost of the Washington Post

Last week, Tom and Martin walked into my office with some troubling news. Meg Whitman, the CEO of Quibi, had been upset about one of our scoops and lashed out against journalists at a company meeting. She had, at one point, compared reporters to sexual predators.

We knew it was an important story. Whitman and founder Jeffrey Katzenberg are trying to build one of the world’s most ambitious media companies, in part by working with news companies.

Tom and Jessica published the story and included Quibi’s official statement, which was that our report was “materially inaccurate.” Our sources said otherwise and I was extremely confident in the piece. But I still left the office upset and shaken that night—upset that she had said what she had, upset that our reporters were being discredited, upset that the news cycle continued to return to this issue. No editor likes to publish a story about attacks on the press, and then to be attacked for it. I was on edge about what Whitman would say to others about the piece. But she didn’t say anything—for days.

Then Friday, at the Sundance Film Festival, Whitman gave an interview to Variety, apologized for her comments and said they were “mostly accurately portrayed.” I’m glad she apologized. Just wondering what took so long and why the company lied to us and the public.

Elsewhere, it was a very busy news week. Kate Clark’s first article for us was an excellent profile of the buzzy Lambda School, which is facing some challenges. Amir and Martin crunched some important math on Uber. And with Bezos in the news, I asked our resident Jeff Bezos expert, the great Nick Wingfield, to share something he has been chewing on with us in the column this week.

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Bezos, Saudis and the Washington Post

This week’s blockbuster revelations about the possible role of Saudi Arabia’s crown prince in the hacking of Jeff Bezos’ phone was a literal eye-popper of a story. It raised so many troubling questions about technology, politics and business. For me though, it was a moment for reflection on a tangential story: how differently the Amazon CEO’s purchase of the Washington Post has played out than many expected.

In 2013, when Bezos announced he was buying the venerable newspaper, I was a reporter at the New York Times and co-wrote its story about the deal, which stunned newsrooms around the country, along with a lot of people in Washington, D.C.

The notion of one of the richest people in the world, and the head of one of its most powerful companies, buying an esteemed news organization prompted a fear: Surely, Bezos would harness the Post to serve his business or ideological interests, as have so many tycoons throughout history, from William Randolph Hearst to Sheldon Adelson. This view has been popularized in the years since by President Donald Trump, who frequently describes the Post as Amazon’s “chief lobbyist.”

Instead, let’s consider what has happened in the more than six years since Bezos bought the Post:

• The paper has undergone a business and journalistic renaissance, under its respected editor Marty Baron, and it has done so without apparent editorial interference by Bezos.
• Bezos’ ownership of the Post has turned him into one of the top targets of Trump’s hostility due to the paper’s critical coverage of the administration. In the meantime, Amazon lost out to Microsoft in the bidding for a $10 billion cloud computing contract with the Pentagon. Amazon has sued to reverse that decision, arguing that it resulted from improper political influence by the White House.
• This week brought reports that a forensic investigation commissioned by Bezos’s camp linked Crown Prince Mohammed bin Salman of Saudi Arabia personally to the hacking of Bezos’ phone. (Saudi Arabia denies the connection). If its conclusions are accurate—and some cybersecurity experts aren’t yet convinced of that—it would appear his ownership of the Post also made him into the victim of a serious hack that may have resulted in the theft of embarrassing personal photos and texts of Bezos and his mistress. (And a report Friday in the WSJ suggesting Bezos’s mistress gave the texts to her brother complicates the story.) The Post had employed the Saudi dissident Jamal Khashoggi, whose death was ordered by the crown prince, the Central Intelligence Agency believes. It’s still unclear if there was a connection between the phone hacking and the National Enquirer’s report on Bezos’ affair.

It’s possible that Bezos could still weaponize the Post to serve his or Amazon’s interests, perhaps by meddling in its coverage of the antitrust scrutiny now focused on the internet retailer and other big tech companies. That seems unlikely though, if only because of the ferocious protests from journalists that would almost certainly result.

It could be argued that the Post has made Bezos more of a celebrity nationally, which in turn has brought him greater political influence. But he was well on his way to becoming plenty famous before he bought the Post. In the long term—Bezos prides himself on his long term thinking—it might burnish his reputation as a champion of the free press and democracy. But in the near term, the Post seems to have primarily imposed costs on him and Amazon in both business and personal terms.

This Week's The Information Articles. To read these articles, subscribe here. 

• Influx of Professional Hosts Tests Airbnb’s Message by Cory Weinberg
• China’s Didi Chuxing Seeks Revival Through Management Shake-Up by Yunan Zhang
• Quibi’s CEO Meg Whitman Compared Reporters to Sexual Predators by Tom Dotan and Jessica Toonkel
• Why Uber’s Stock Rally Doesn’t Make Sense by Amir Efrati and Martin Peers
• Barr Ratchets Up Pressure on Tech With Liability Threat by Ashley Gold
• Quid Pro IPO? Software Tech IPO Practice Raises Disclosure Questions by Kevin Dugan and Priya Anand
• Lambda School’s Growing Pains: Big Buzz, Student Complaints by Kate Clark
• The Secret to Success in the Direct-to-Consumer Market by Priya Anand
• 2030’s Big Business: Tech or Something Else? by The Information Staff
• Coding Bootcamp Galvanize Agrees to $165 Million Acquisition by Priya Anand
• The Information’s 411 — Initial Private Offering by Tom Dotan

Have a great weekend,

Jessica