2014 opened with the spectacle of the "Most Well-known and Beloved Chinese Role Model" (amongst eight other self-proclaimed titles on his English-language business card) lusting after The New York Times. Chen Guangbiao (a Chinese businessman with a net worth approaching three-quarters of a billion dollars) is anything but secret desire to purchase "The Gray Lady" provided many a media chuckle. In the fun, Chen's vision was given short shrift.
Explaining his rationale, Chen said he "realized that the Times' influence all over he world is incredibly vast, every government and embassy all around the world pays attention to The New York Times." No doubt. In my view this statement only applies to two other American-based newspapers, The Wall Street Journal and The Washington Post.
Chen went on to say that if succeeded in his quest to purchase The New York Times, "he would like every Chinese household to subscribe to the paper." Any global newspaper's dream -- the more subscribers you have, the bigger the sphere of influence and the larger the revenue base.
In my humble opinion, the statements by Chen are precisely why Amazon CEO Jeff Bezos plucked down $250 million of his $27 billion personal fortune last summer to purchase The Washington Post. Bezos surely recognizes the global influence of the renowned investigative voice of our nation's capital. I'm sure, as Chen would, Bezos would now like to build a much larger Washington Post subscriber base.
Regarding Chen, the part I'm not sure about is whether he has a plan and mechanism to get that larger subscriber base for The New York Times. It doesn't seem anyone thought to ask in all the hilarity. I'm reasonably certain Bezos has both for The Washington Post. One word: "Amazon."
It's no secret the Internet continues to annihilate the traditional newspaper's business model in every way -- ad revenue migration and print circulation declines. The greatest value left in The New York Times or The Washington Post is brand -- built up since their inceptions in 1851 and 1877, respectively. As ink on paper goes the way of the dodo, these brands need adequate financial resources to transition their dominance to the web and the mechanism to turbo-charge Internet circulation in a fiscally sensible, self-sustaining way. The likely why in Donald Graham's decision to sell The Washington Post and Jeff Bezos' decision to buy it.
It was recently reported that the Amazon Prime service increased its subscriber base by more than a million people in just the seven days of the third week of December 2013. It is currently estimated that 20 to 25 million American households have an Amazon Prime account. The number of non-US Amazon Prime households is another 15 million. At the time Bezos purchased The Washington Post, it's daily circulation was in the neighborhood of just 475,000. How fast do you think that number will rise if The Washington Post is made available (in whole, in section, by article) to Amazon Prime subscribers under a variety of micropayment options?
Can you picture the likely seamless, voluminous and continuous downloading to the millions of Amazon Kindles in the world, or the ubiquitous Apple iPads around the globe? I bet Mr. Bezos does.
What I just described is the part I'm not sure Chen sees, or for that matter if The New York Times Chairman Arthur Sulzberger, Jr. does. I wish someone had bothered to ask Chen how he was going to get "every Chinese household to subscribe to the paper." Does he already have an arrangement with one or more of China's big Internet players (Alibaba, Baidu, Tencent) lined up?
Perhaps he has that and Chinese government support. If he does next time while we are enjoying the chuckle we may also want to pay much closer attention. Thought leadership is in play!