During the time of American publisher William Randolph Hearst, print journalism was a huge hit. So it made sense for investors to buy newspapers. Today, it is digital journalism that takes the helm. Even if newspapers are in dire straits, the likes of Warren Buffett and Jeff Bezos allocate millions in newspapers.

The Berkshire Hathaway head bought more than 28 local newspapers, including The Free lance-Star, for approximately $344 million. The Amazon boss made a $250 million purchase of the Washington Post and its affiliated publications despite the publication’s reported loss. Boston Red Sox owner John Henry acquired The Boston Globe from the New York Times Co. for $70 million.


The Pew Research Center observed weekday print circulation has dropped 17% and ad revenue has plunged more than 50% over the past ten years. The figures did not stop Buffett, Besos, and Henry from trusting the paper, though. According to Morningstar equity analyst Liang Feng, money is not the only main consideration for making such acquisitions.

Buffett once mentioned there is a potential in local newspapers, saying the print continues to dominate the delivery of local news. Amid the supremacy of digital media, local papers can still generate income.

Expressing his confidence on the Post, Bezos said the publication has an exceptional leadership team that knows the nuts and bolts of the industry well. He was buying it as an investor, not someone who was trying to get into the business as a newsperson. In simplest terms, Bezos was just investing.

Why are they investing in the old school medium? Aside from new revenue stream, here are the other reasons:

Brand Recognition

Brand recognition is the first factor they take into account when they desire to sink their teeth into this business. Most businessmen are chasing established and well-known newspapers, regardless of its audience reach, not the small time dailies with low number of readers. They do not look for trendy and upstart media entities either.


Businessman John Henry acquired The Boston Globe for $70 million. That was a steal if we are looking at the $1.1 billion price tag boasted by the daily paper. The purchase price, if right, is nothing compared to the newspaper’s reputation.


As we mentioned earlier, investors are looking after papers with great demand and need. When Buffett unveiled the Media General agreement, he quipped the necessity of getting the news across. He also said everyone in the happenings in Grand Island, Nebraska, including the performance of their football team.


By investing in distinguishable newspapers, they are positioning themselves alongside reputable media companies. When Bezos announced his obtainment of the Washington Post, he said journalism plays a vital role in a free society, and so is the American daily.

Long-Term Growth

The Newspaper Association of America reported circulation revenue for newspapers grew in 2013 for second straight year, increasing 3.7% to $10.87 billion. As of now, digital advertisements are growing, thanks to technology. Newspapers may be on the downfall, but stability and growth remain in the realm.