Few businesses are doing better right now than Amazon (NASDAQ:AMZN), as the coronavirus lockdown fuels the online shopping behemoth.
This is great news for its owner, Jeff Bezos, the world’s richest man with a reported net worth of $120 billion .
But with U.S. newspapers facing an existential crisis , business commentators will be keeping a keen eye on how another of Mr Bezos’s companies fares amid coronavirus: The Washington Post.
The U.S. media industry – and, for that matter, the global media industry – is facing a brutal paradox.
Readers are desperate for news on how the coronavirus crisis is unfolding in their country, how much longer the lockdown will last and what measures world leaders are taking.
But with many businesses forced to shut, advertising revenue across the industry is plummeting , and the lockdown means people are struggling to buy a physical copy.
Most of the pain is being felt by smaller publications, with newspapers in Louisiana, Ohio and Washington State either furloughing staff, reducing working hours or lowering the frequency of publications.
But bigger titles are feeling the heat too. Florida’s Tampa Bay Times has gone down to two days a week after losing more than $1 million in advertising revenue, its chairman Paul Tash told staff in a memo :
Gannett (NYSE:GCI) – publisher of USA Today and more than 250 papers – has seen its shares drop from roughly $6 at the start of the year to $0.92 now.
If President Donald Trump is to be believed, the Washington Post – or WaPo – has seen a hit to advertising revenues too.
This claim is unverified and neither The Washington Post nor Bezos has made any comments about whether the paper is suffering amid the coronavirus crisis.
One thing is certain: The Washington Post has been growing digital subscriber numbers since Bezos bought the paper for $250 million from the Graham family in 2013.
According to Nieman Lab data, WaPo boasts 1.7 million digital subscribers – the second best nationwide behind The New York Times (2.7 million). WaPo crossed the 1 million mark in 2017 .
It emerged in 2018 that the paper was celebrating its second consecutive year as a profitable company , according to a memo obtained by the media.
Bezos owns WaPo through a private company called Nash Holdings LLC. Financial filings for the firm are not publicly available.
Data firm Dun & Bradstreet believes Nash Holdings LLC had revenues of $1.72 billion . But Nash apparently has seven subsidiaries, making it difficult to know how much can be attributed to WaPo.
Even if WaPo’s ad revenue has declined, its owner has weapons beyond its Pulitzer Prize-winning journalism.
Last year, WaPo struck a deal to license its content management platform, Arc, to its first non-media customer – British oil firm BP. Arc can be used by companies to publish content to their staff.
Licensing revenue tripled from 2016 to 2017 and doubled in 2018 . Arc should generate $100 million in revenues within the next three years, the third largest stream behind advertising and subscriptions.
Even if advertising falls, Arc could pick up the slack or, if necessary, Bezos could afford to help out.
With a slogan like ‘Democracy Dies in Darkness,’ it’s likely the world’s richest man will want to keep every light shining bright.