Is Amazon.com in market for a major Japanese daily?
Japanese seem to hate the notion of being left out of a group, even a group to which they don’t really want to belong.
Yet despite the seemingly far-fetched notion of one of Japan’s top vernacular dailies being bought out by a young (49) American upstart like Amazon CEO Jeff Bezos, a writer for Shukan Post (Aug 30) has milked the brains of some knowledgeable people and provides some useful data about the present and future prospects of the nation’s newspapers.
One point he makes is that Amazon.com is loaded. While the Washington Post’s price tag of $250 million may sound like a lot of money, it’s just a drop in the bucket to Bezos—about 1% of his company’s total worth. With annual revenues equivalent to 5.7 trillion yen, Amazon, with its business model of “taking out the middleman” to deal direct with consumers, no longer feels constrained to limit its acquisitions to U.S. corporations.
The article looks at the operations of several newspapers, including the Asahi and Sankei, and examines their struggles to streamline operations and expand their online businesses. Success has been elusive, to say the least.
The Yomiuri, which has vowed a “fight to the death” to hold the line at 10 million subscribers, has placed its dependence on the print edition, and has consequently fallen even further behind in terms of its Internet operations. It’s been said that Yomiuri plans to bolster its business by delivering syndicated news to Japan’s regional newspapers, but this is also swimming against the current, since syndication has been losing its presence as the Internet develops further.
But will one of them be open to a buyout proposal by an outsider—especially a foreign outsider?
“Bezos’ restructuring of a newspaper is part of a worldwide phenomenon,” says a well known media analyst based in California. “I’m certain that he’ll be visiting Japan soon.”
For corporations, ownership of a newspaper is a means of demonstrating “trust,” and a way of narrowing its distance from the government. In Amazon’s case, however, what the company desires most is customer data, and tying up with a regional information network through the acquisition of a newspaper with several million subscribers promises to expand presence on multiple levels. Bezos may also be attracted by the potential for the prestige he’d get from being the only foreigner to achieve such status in Japan.
Shukan Post points out that Japan’s newspaper companies owe much of their development to the “Nikkan Shimbun-ho” (law controlling daily newspapers), which was promulgated in 1951 by the allied occupation to prevent communists from infiltrating the newspapers.
“In one sense, the law was not a bad thing, because it protected Japanese journalism,” says Yoshiyuki Hashiba, a former Mainichi Shimbun editor who now lectures at Waseda University. “But it’s a fact that now the law is impeding the newspaper companies from advancing into a new era.”
“Newspaper companies that can’t boost their circulation and are also failing to expand their electronic editions are eventually bound to become no more than ‘vendors’ who just deliver contents that can be sold one at a time via Amazon.com,” says an unnamed source within the Asahi Shimbun. “Rather than buy a Japanese company outright, it might be more realistic for Amazon to stick to this.”
“Right now,” he adds, “the media may be on the verge of an era of change, the likes of which haven’t been seen since Gutenberg’s invention of movable type.”
“Newspapers produced in Japanese are poor in terms of appealing abroad,” observes U.S.-based journalist Yuji Kitamaru. “And because they enjoy the protection of the Newspaper Law, they’ve been slow to react to prevailing currents in the rest of the world. If they believe they can somehow prevail without teaming up with European and North American media, it’s entirely possible they’ll start to fester from their roots, and the point will arrive when it’s too late for them to recover.”