1“TAKE THE GIFT”
Washington, D.C., was deep into its swampy summer weather when the publisher of The Washington Post asked if I could make myself available for drinks. She proposed five p.m. at Loews Madison Hotel, diagonally across 15th Street NW from our drab but imposing headquarters, a landmark that acquired a certain glamour after the Academy Award–winning movie All the President’s Men celebrated the newspaper’s Watergate investigation that brought an end to the presidency of Richard M. Nixon.
Late afternoon is no time to be ducking out of a newsroom, with stories piling up on deadline. Reading journalism, not sipping cocktails, was how I was supposed to be spending my time. But when the boss calls, you go. And the timing of the invitation suggested a surprise might be in the works. As a veteran of endless upheaval in my profession, I had learned to sense when to expect the unexpected.
Katharine Weymouth was the fifth member of the Graham newspaper family to hold the title of Washington Post publisher. When named to the position in 2008, she followed in the path of the widely revered family patriarch Don Graham, her uncle and CEO of The Post’s parent company, who was now also her boss; her grandmother Katharine Graham, famed for her role in overseeing the paper through Watergate and the Pentagon Papers; her grandfather Phil Graham, who helped persuade Democratic presidential nominee John F. Kennedy to select Lyndon B. Johnson as his running mate in 1960; and her great-grandfather Eugene Meyer, who bought The Post at a bankruptcy sale in 1933.
Smart and tough with a cutting wit, Katharine was as direct a person as I knew. Though she had grown up in a life of privilege in Manhattan’s Upper East Side, she was devoid of pretense and bullshit. A graduate of Harvard College who got her law degree at Stanford, she worked as a litigator at a top-tier Washington firm before joining the newspaper her family controlled, first as a lawyer and later as the head of advertising. Katharine would be a different sort of publisher. She was divorced and a single mom, managing a household of three kids, and she was now preoccupied with a daughter who had fallen while horseback riding and undergone more than a dozen surgeries to her left arm. Even so, she welcomed casual get-togethers at her unpretentious home in the Chevy Chase neighborhood of Washington.
I had been at The Post for only seven months, but our relationship was easing into a comfortable groove. To my surprise, she trusted me implicitly from the start, almost to an unsettling degree. The day I began in the newsroom, she was on vacation, anticipating that I could make my debut in The Post’s culture entirely on my own. Helping to shore up my relationship with the news staff, she cut me slack on first-year budget constraints. When I appeared exhausted months into the job, she insisted I take time off for my physical and mental well-being. Our meetings were conversational and crisp, without a list of agenda items. We both preferred plain talk, informality, and brevity.
On July 30, 2013, Katharine got straight to business: The Washington Post was going to be sold. The buyer would be Jeff Bezos, the megabillionaire founder of Amazon. It would be announced after the weekend, on Monday.
The Graham family had held dominion over The Post for eighty years, and in two months they would relinquish control. One hundred percent of a famed news organization would be entirely in the hands of one of the planet’s richest people. The buyer’s home was 2,300 miles away, near Seattle. And, of particular interest to hired hands like me, the internet shopping behemoth he ran was fast acquiring notoriety for high-pressure working conditions.
There was another reason for me to be wary. Amazon also sold cloud computing services to the U.S. government, most notably the CIA. That happened to be one of many intelligence agencies that were livid over The Post’s publication less than two months earlier of the government’s most highly classified documents, leaked by Edward Snowden, that revealed unprecedented surveillance of individuals’ digital communications. The Post had assumed giant risks in publishing those documents. There was no shortage of officials who felt we had aided and abetted treason. What would become of such stories with Bezos in charge?
Katharine explained the sale plainly: The Post was in a bind. It couldn’t find its way out. Revenues would continue to slide as print advertising vanished in the internet era, online ad rates would wilt, and getting people to pay for digital subscriptions was more something to pray for than something to count on. Costs would continue to be cut. Our news coverage, continuing to atrophy, would become unrecognizable to anyone with memories of The Post’s proud record of ambitious journalism. We were in the same fix as every other American newspaper except The New York Times and The Wall Street Journal. The company had run dry of ideas for salvaging itself. CEO Don Graham had looked for someone who might figure things out, and Bezos had the very qualities we might need: brains, tech savvy, and money.
Katharine was struggling to keep The Post profitable. Don had decreed she must, even as he pressed her to spare the newsroom from major budget cuts. At the same time, she had to find new revenue from digital advertising, which sold for pennies. “I often felt like the miller girl in Rumpelstiltskin,” she later told Bezos in a memo summarizing our financial condition, “being asked to spin gold out of straw—the straw being our digital business—only I could not find the little man to magically do it for me.”
I had a good feel for what she was going through. I arrived at The Post that January from The Boston Globe, where I had been the top editor for more than eleven years. Near-death financial losses were still fresh in mind. Over time I had to slash the number of Globe journalists by 40 percent. Bureaus in Berlin, Bogotá, and Jerusalem were closed, ending a proud legacy of foreign coverage since the 1970s. Losses by 2009, in the midst of the Great Recession, were so catastrophic that The Globe’s owner, the New York Times Company, threatened to shut the paper down unless thirteen unions immediately agreed to massive sacrifices in compensation.
When the unions ultimately yielded after bitter protests, the Times Company seized the moment by putting a “For Sale” sign on The Globe. Months later, apparently dissatisfied with the bids, it took The Globe off the market. Within two years, word was out that the Times Company was again earnestly shopping The Globe to the monied class of Boston and anyone else who might be interested. The controlling family of the New York Times Company saw The Globe as a dead weight on The Times’ grander ambitions. No doubt it was.
The Times Company addressed rumors of a sale in its customary rote, nonresponsive manner: It could “neither confirm nor deny” them. But intentions were unmistakable when Vice Chairman Michael Golden told me in a private lunch that the “flesh, blood, and bone” of the New York Times Company was The New York Times itself. It stung to hear it stated so bluntly, and yet Golden was telling me what I already knew. The paper once so coveted by the Times Company that it shelled out $1.1 billion to purchase it in 1993 was now a burden best rid of, if even for a pittance.
Prospective buyers were no mystery. One possibility was a private equity firm that was likely to slice staffing by a third or more. A previous bidder had already confided its view that investing in quality journalism was a fool’s errand. Another possibility was a local power broker, putting our journalistic independence at risk. The top editor was often the first casualty of a sale. Time to leave, I figured.
I was already one of two finalists for a job outside daily journalism when Katharine called in late 2012 to inquire whether I might be interested in leading The Post. Relations with her editor of four years, Marcus Brauchli, the former top editor of The Wall Street Journal, had suffered from budget pressures and a breakdown of communication and trust, rupturing in part over disclosure of Post plans to allow lobbyists and association executives to pay large sums to attend off-the-record “salons” with Obama administration officials, members of Congress, and the paper’s journalists at Katharine’s Washington home. That was a perceived breach of ethics guardrails for journalists.
Katharine’s overture intrigued me. Perhaps the homestretch of my career could be at The Post, in a newsroom that occupied an exalted position in American journalistic history. While The Globe could never have been the heart and soul of an outfit named the New York Times Company, I felt confident that The Washington Post held that treasured position in an enterprise called the Washington Post Company. No matter how rocky the future, I couldn’t imagine The Post being sold. Not by the Graham family. There were few certainties in journalism any longer, but that had to be one of them. The Post and the Grahams were ostensibly inseparable. Don loved The Post, spending almost his entire adult life there after a brief stint as a Washington policeman—he could identify just about everyone by name—and the people at The Post loved him back.
Now, seven months after I was hired as The Post’s executive editor, Don was selling it out from under me. Katharine swore me to secrecy and instructed me to call Don later that evening. He wanted to talk. After dinner at the Blue Duck Tavern in Washington, D.C.’s West End neighborhood with Sally Quinn, wife of legendary Post editor Ben Bradlee—where I offered no hint of the momentous events about to unfold—I called Don. It was getting late, about nine p.m., but he invited me to swing by his brick Dupont Circle town house.
Don was gracious, as always, promptly apologizing for selling The Post just as I had started there. He volunteered that he had been shopping The Post even before my arrival. “That’s okay, I understand,” I told Don, assuring him that I wasn’t naive about the way business works. Don twice repeated his apology, I repeated my answer. An exasperated Don said, “Would you let me apologize?”
In truth, I wasn’t upset. I had my worries, not least for my own career, but I took the sale as a sign of hope. It was the only one I knew of. As much as I admired Don and what he and his family had accomplished in building The Post into one of America’s most distinguished and fearless newspapers, no one had a plan other than managing decline. Sale of The Post was a reckoning with the facts. I found that refreshing and overdue. It was only after my retirement that I reconstructed how the Graham family came to part ways with The Post, asking its top executives to recollect conversations and key details that had yet to be published.
* * *
When Katharine was named publisher in 2008 in the midst of a punishing recession, Don had told her at a board meeting, “Kath, I’m counting on you to save the newspaper.” But by July 2012, her assessment of The Post’s prospects over the long term was grim. Katharine’s own president, Stephen Hills, had emphasized to her a year earlier in a memo that a sale should be considered for a wide variety of reasons: Business trends were becoming only more disturbing, internal differences over strategy were great, and the parent company’s stock would be pummeled if it made further big investments in The Post. At a meeting in Fort Lauderdale of the company’s Kaplan Education unit, she stressed to Don how keeping The Post profitable was at odds with his desire to maintain a newsroom of robust resources and a paper he could be proud of.
“You would tell me if you thought we should sell it,” Don occasionally remarked to Katharine. It was a line she had long dismissed as fanciful. It was unthinkable that he would sell the paper that was the object of his passion. But the unthinkable was quickly becoming top of mind.
By the summer, Katharine could see only limited options for The Post in the years ahead: Make drastic cuts in its newsroom that might ensure profitability over the long run but severely damage coverage and the paper’s reputation. Or make gradual cuts year after year, hoping that new business ventures would bring in more money than they had so far. Or sell The Post, striving to find an owner who believed in the paper’s mission, had deep pockets and possibly better ideas.
With Don’s permission, she conferred in June with Warren Buffett, the famed investor who was his close and constant adviser, in a private room in Washington, D.C.’s Jefferson Hotel. “Am I missing something? Is there something else?” she asked. Her analysis struck Buffett as spot-on, but he added: “Your uncle will never sell.” So he advised her to concentrate on the two distasteful options that remained.
In October 2012, Katharine and Don met for lunch at the Bombay Club, a high-end Indian restaurant less than two blocks from the White House. Sitting far from other diners to ensure privacy, Katharine told him, “I’ve been publisher of The Post five years. Every one of those years, I had to cut expenses and lay off people when it was bad for the newspaper. And I’ve done my best to look at the next five years. I think they’re going to be like the last five years.”
The conversation continued on a bench in Lafayette Square, the seven-acre park that fronts the White House. Katharine stopped short of calling for The Post to be sold, but she recommended that the parent company’s board of directors consider identifying a potential owner who would be committed to the paper’s mission and could be a good steward as her great-grandfather Eugene Meyer had become when he bought The Post in 1933. Although members of the family had presided over the company ever since, its shares were publicly traded and the board of directors would have to approve a sale. “Maybe we should start to think about whether someone out there would be a better owner,” Katharine told Don. There was also a more pointed message, as Katharine remembers it: “If you want me to cut the shit out of the newsroom, I want to know you have my back because I’m going to be eaten alive.”
Only days later, in November, a board meeting of the parent company was scheduled. While on a walk shortly before the meeting, Don suggested to Katharine that the idea of finding a different owner for The Post be discussed when directors convened for dinner at Washington’s Ritz-Carlton hotel. When Don asked the waiters to leave the room, she brought it up. There was no PowerPoint, only a conversation. In a series of sharp questions, Katharine was asked how much The Post might lose in the next recession. Hundreds of millions of dollars, she answered. Before heading to bed, board members authorized Don to explore whether the right kind of buyer could be found.
Under its ownership, the Graham family had displayed a “quasi-religious dedication to The Post,” as Don put it to me. But with the board’s assent, he embarked on a course that showed how even such fervor has limits. He contacted investment banker Nancy Peretsman of Allen & Co., who had worked closely with The Post in the past, confident that she would safeguard the secrecy of a search for a suitable buyer. “I was petrified of a leak,” Don said. “We didn’t want to auction The Post to the highest bidder,” a process that could put it in the hands of someone with political aims.
Among those contacted were David Rubenstein, the Washington, D.C., philanthropist who had earned riches in private equity. He took a pass, as he would periodically remind me when we happened upon each other in D.C. Another was Pierre Omidyar, the founder of eBay, who was keenly interested. Negotiations with Omidyar started in the spring and continued through summer. When I sent questions his way more recently, he dispatched a representative to tell me it allowed him to “think more concretely about what might be possible with an outlet he respected greatly and, more importantly, one that he felt played a critical role in our democracy.” Katharine recalls Omidyar writing “a moving letter” that she summarized as “I’m going to take care of your baby if you give it to me.” He doesn’t recall writing anything but “certainly believes he did relay those intentions at some point.” Still, Omidyar offered only $150 million, far less than the asking price.
Don identified Bezos as a prospective purchaser. They had known each other in a cursory way as far back as 1995. Bezos knew technology inside and out. He was obviously successful in running a company. And then there were his bottomless pockets, allowing him to pay for The Post and invest even more in its future. Don told me there were other reasons he liked the idea of Bezos as owner: “Jeff’s a reader.” And he kept his politics to himself. “I didn’t know what his politics were … I was not about to sell to someone who bought it to tell the president what to do.”
Bezos has said he was “startled” when Peretsman called. “I said, ‘Nancy, you know, why me? Why are you calling me? I don’t know anything about the newspaper business.’” For months Bezos never called back, never manifested a bit of interest. Suddenly Don received an email from Bezos saying he’d like to talk, if Don was still interested. He had thought things through. He had done his research. The two met over lunch in Sun Valley, Idaho, where Allen & Co. held its annual media conference for one week in July. Bezos paid a visit to Don at his lodging.
Don quizzed Bezos on whether his interest in The Post had to do with political motives, warning that if it did, it would “blow up in his face.” Bezos responded, “It’s the furthest thing from my mind.”
At a follow-up Sun Valley lunch, Bezos shook hands with Don on a deal to acquire The Post for the $250 million he was seeking, and within a couple of weeks a three-person team that handled Bezos’s personal investments was in Don’s Dupont Circle town house reviewing detailed financials with The Post’s publisher and president as well as a senior financial executive of the parent company. The Bezos team’s primary concern could not have been a surprise, given Amazon’s business history: The Post had a unionized workforce. How big a problem would that be?
* * *
When, in July, Katharine told me that a deal was struck and an announcement was imminent, I thought it had to be good for The Post. We were starved for unconventional thinking and long-term investment. If anyone could help us, surely Bezos could. I figured he would aim for growing, not shrinking, our way to profitability. I wasn’t as confident, though, that the deal would be good for me. I’m a realist if nothing else. If Bezos wanted to signal quickly that things were going to change, he might just send me packing.
The immediate mandate was to keep the sale secret while also getting a story written in advance and preparing key editors to publish it online at the right time. Press releases and the letters Don and Katharine would address to Post employees had yet to be written.
Don suggested that perhaps I should write the news story of the sale myself. I demurred. This historic transaction should be covered as any other news would be. A reporter would have to be assigned. Paul Farhi, the media reporter, was the natural choice.
Paul was startled when I reached him on Saturday as he and his wife, Lisa, were wrapping up a vacation at a resort in Punta Cana, Dominican Republic, planning a return home later that day. Why would I be calling him? Why now? What I conveyed wasn’t helpful. I told him nothing, except to be at his phone at 9:30 Sunday morning for a story of major significance. At dinner that night, Paul and Lisa discussed what the story might be about. “Maybe the paper is going to be sold,” she said. Ridiculous, he responded.
I broke the news to the twenty-five-year Post veteran the next morning, with instructions to prepare a story that I would personally edit via email to avoid anyone stumbling across a copy in our computer system. The story would be kept under embargo until 4:30 Monday afternoon, when Don and Katharine would jointly announce the sale to staff.
On Sunday afternoon an Amazon staffer connected Paul with Bezos, who spoke for fifteen minutes or so. “He was very friendly and chatty and didn’t duck or avoid anything I asked him,” Paul later told me. One word stuck out to Paul: “Runway.” Bezos said he wanted to give The Post the “runway” to grow and become profitable again. “I remember being a bit skeptical about that,” Paul said. “It sounded like standard corporate PR to me—positive but extremely vague, with no real commitment or identifiable goal. As it turned out, there was an enormous amount of significance in that one word!”
Paul stayed up most of the night to write, sending me a final version that included my edits before he headed into the office at noon Monday. As Paul drove in, a good friend of his called on his cell phone. Paul told him a big story was coming. “Let me guess,” he said. “The Post is going to be sold.” He rattled off three would-be buyers, ending with “Amazon.”
“I practically had a heart attack on the Whitehurst Freeway! The next few hours went by agonizingly slowly. I just knew—knew!—the story was going to leak at any second. It was like those movies in which the main character hears every single tick of the clock.”
Word had, in fact, begun to seep out. Don had told his senior staff by midafternoon, and Katharine had told hers. A couple of journalists dropped into my office to signal they knew what was up. But word had not spread widely. At 4:15 p.m., Katharine sent an email to the entire newsroom to meet fifteen minutes later in the auditorium on the first floor. As staff speculated about what might be happening, features editor David Malitz said to Paul, “Whatever this is, it sounds like you’re going to have to write a story about it.” Replied Paul: “I already have, David.”
Employees began to weep as Don told them his family’s eight decades of stewardship would end in less than two months. “The Post could have survived under the company’s ownership and been profitable for the foreseeable future,” Don told them. “But we wanted to do more than survive. I’m not saying this guarantees success, but it gives us a much greater chance of success.”
In a letter to staff, Don wrote, “The point of our ownership has always been that it was supposed to be good for The Post. As the newspaper business continued to bring up questions to which we have no answers, Katharine and I began to ask ourselves if our small public company was still the best home for the newspaper.”
Bezos issued a requisite but reassuring statement of his own, declaring that journalism “plays a critical role in a free society.” The Post, he said, “will continue to follow the truth wherever it leads.”
Bezos did not join Don and Katharine for the meeting with employees. Understandably, that was the Graham family’s day, not his. We did, however, count on hearing from him in person immediately afterward about an acquisition that was likely to have a profound impact on our careers and arguably on all of journalism. As a week passed with no sight or sound of him, Post journalists naturally began to question why. The news staff grew agitated that Bezos had not yet showed up to speak directly to them and other employees, and in particular they expressed worry that I had yet to hear from him. I was worried, and annoyed, myself.
Copyright © 2023 by Martin Baron
