New York Times

Bezos 'going to break eggs at Washington Post' but which eggs?

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By Noel Young, Correspondent

August 18, 2013 | 7 min read

With the newspaper world agog about what Amazon's Jeff Bezos intends to do with the Washington Post, the headline on the front page of the New York Times Business section today must have set a few hearts racing: "He's 'Going to Break Some Eggs," it said.

JEFF BEZOS: Tough

Panic not. This lengthy article in fact does not even come close to suggesting which eggs Bezos might break. Instead we get anecdotes, which give no clue as to what he might have in mind - unsurprising as Bezos appears not to have talked to the NYT.

What we DO get is James Marcus, Amazon employee No. 55 and now executive editor at at Harper's Magazine, saying, “Jeff may be outwardly goofy, with that trademark laugh, but he’s a very tough guy. If he goes even halfway through with his much-vaunted reinvention of journalism, there is no way he’s not going to break some eggs.”

The NYT says Bezos has more than his share of detractors — "just ask your neighborhood bookseller, if you can find one" - but it is increasingly hard to dispute that he is the natural heir of Steve Jobs as the entrepreneur with the most effect on the way people live now.

After delivering that compliment, the Times says that having bought The Washington Post for $250 million - the equivalent to him of pocket change, "No one, apparently including Mr. Bezos himself, seems to know what he intends to do with that fabled newspaper."

The NYT says that Amazon is an empire that spans much of the globe and even has its own currency, Amazon Coins.

"What it does not have much of, and never did, are old-fashioned profits.' Ouch!

More negativity: "The company has all sorts of regulatory and competitive concerns, making for a minefield of possible conflicts of interest for the owner of The Post."

Amazon has opposed states’ efforts to have e-commerce companies collect sales tax. It was the main beneficiary of the Justice Department’s successful pursuit of five publishers and Apple on antitrust grounds, says the NYT.

Through its thriving data storage division, Amazon is becoming an important contractor to the government bureaucracy that is a mainstay of The Post’s reporting. If persistent rumors are true and the company produces an Amazon phone, yet another set of antagonists will arise.

“Newsrooms are very conservative,” said Bill Buzenberg, executive director for the Center for Public Integrity. “They have difficulty changing and certainly they have difficulty selling out their core principles.”

Perhaps. But then, few newsrooms have ever been confronted with a new owner whose zeal for disruption is matched by his obsession with tinkering until he gets it right, says the NYT.

Marcus however had this significant point to make: “Bezos is fascinated by broken business models. And whatever else you think of newspapers, the business model is broken.”

Bezos has never seemed much of a fan of journalism or journalists, says the NYT.

"He gives interviews only when he has something to promote, and always stays on message. He likes his privacy; there are no “at home with” magazine features with him lounging with his wife, MacKenzie, and four children at his luxurious Seattle lakeside estate.

Amazon’s quarterly earnings calls with analysts and journalists are festivals of vagueness.

"Even a number as basic, and presumably impressive, as how many Kindle e-readers the company sells is never released.

“Every story you ever see about Amazon, it has that sentence: ‘An Amazon spokesman declined to comment,’ “ Marcus said.

Drew Herdener, an Amazon spokesman, declined to comment.

Instead of newspaper ideas, we get the aspirin story from the NYT.

"Early employees of Amazon still remember the day the company took away their aspirin.

It was late 1999. Amazon was burdened with debt and spiraling losses. Jeff Bezos, its founder and chief impresario, had to impress Wall Street that he was serious about cutting costs.

"But how? Amazon had never indulged employees with Silicon Valley perks like massages or sushi chefs. Just about the only thing that workers received free was aspirin. So the aspirin went."

It was so hot in Allentown, Pa., in May 2011 that some workers at the Amazon warehouse there collapsed.

"Another company with different attitudes might have installed air-conditioning, or simply sent workers home during heat spells. If Amazon did that, however, East Coast customers might not get their Jay-Z CDs or diapers or jars of heather honey as quickly as they expected," reports the NYT.

"So the company chose a different solution. It arranged to station ambulances and paramedics out front during five days of excessive heat, according to The Morning Call, the Pennsylvania newspaper that broke the story. Fifteen workers were taken to area hospitals after they fell, and as many as 30 more were treated by paramedics at the warehouse.

"'Workers quoted by the paper said the heat index in the facility, a measure that includes humidity, was as high as 114 degrees. Amazon had little to say to the newspaper, even when it later installed air-conditioning," the Times notes,

In recent years Amazon has become a big government contractor .

Amazon Web Services, is a leading service for third-party rental of computing and data storage. Besides hundreds of thousands of individuals and businesses, more than 2,000 research institutions and 500 government institutions worldwide use A.W.S. In addition to the eight major centers, A.W.S. operates a separate data center, called GovCloud, for the United States government.

Recently, A.W.S. was awarded a contract valued at $600 million to provide computing services to the Central Intelligence Agency. James Staten, an analyst with Forrester Research, said the C.I.A. contract was a breakthrough for Amazon. I.B.M. formally protested the award on undisclosed grounds. The Government Accountability Office, while finding generally for Amazon, said the C.I.A. should re-examine the deal. Amazon is expected to officially apply for the original award to stand.

Although Bezos, not Amazon, bought The Post, Kate Martin, director of the Center for National Security Studies, said, “It’s a serious potential conflict of interest for a major newspaper like The Washington Post to have a contractual relationship with the government and the most secret part of the government.”

Rather than the revelations implied by the original headline, much of the NYT story seems to consist of negative remarks like that.

Could it be that the real story is that Bezos intends to replace the Times with the Post as America's national newspaper of record? Now that really would be breaking eggs.

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