Bezos's takeover of the Washington Post may be a bargain

In Beijing August 6, Amazon CEO Bezos (Jeff Bezos) has just spent 250 million dollars on the purchase of the Washington Post. Even now the newspaper industry is depressed, but the Washington Post is a solo show, the financial situation presents a lot of bright spots. Perhaps Bezos made a good deal.

Here's a look at the negative side, based on an analysis of the Washington Post's 2012 annual earnings report.

Revenue is falling:

• 2012 total revenue fell 7% to 581.7 million U.S. dollars.

• The newspaper business lost 54 million U.S. dollars in 2012 years, an increase from the loss of $21 million in 2011.

Print advertising revenue decline is particularly obvious:

• 2012 down 14%.

• 2011 Down 11%.

• 2010 Down 6%.

A decline in circulation:

• 2012 slipped 2%.

Print advertising business revenue becomes a prominent issue:

• Print advertising revenue fell 14% to $228.2 million in 2012.

The financial position of the website department is good:

• Website Revenue (most of washingtonpost.com and slate.com contributions) grew 5% to $110.6 million in 2012.

• Network display advertising revenue increased by 6% in 2012.

• Net classified advertising revenue rose 1% in 2012.

Bezos, though not buying Slate.com, spent only 250 million dollars on the Washington Post and its web site. This is still a good deal, from the above data can be seen, the company's annual income reached 581.7 million dollars. In addition, about one-fifth of the Washington Post's revenue (about $100 million) comes from the Internet sector and continues to grow. As a result, the company will make a profit if it makes some adjustments slightly.

All in all, Bezos's bid is only 0.5 times times the total annual revenue of the Washington Post, twice times the annual revenue of the company's network business. If acquired according to the standards of start-up technology companies, the purchase price should be 6 times times the annual revenue. From this point of view, Bezos did make a good deal.