Wash Post Co. 'Rebranding' Will Stress Education Properties

By: Joe Strupp Nine months after The New York Times Executive Editor Bill Keller critically referred to The Washington Post Co. as "an education company that happens to own a newspaper," Post Chairman Donald Graham appears ready to agree with him, at least in part.

Noting that its flagship paper provides just 21% of The Washington Post Company's revenue, while educational brand Kaplan brings in half, The Post reports that Graham plans to "rebrand" the family business as an "education and media company."

In a Post story today, Graham said he planned to explain the somewhat symbolic change at a meeting in New York today with Wall Street analysts and shareholders. The story stated that change reflected "the rise of Kaplan Inc. within The Post Co. and the decline of its flagship newspaper."

"Kaplan, which The Post Co. purchased in 1984, now accounts for 50 cents of every dollar in Post Co. revenue, by far the top earner in the company, according to the company's third-quarter earnings report released last month," the Post reported. "The newspaper division, primarily The Post, accounts for 21 cents of every dollar. Kaplan passed the newspaper division in revenue in the third quarter of 2003.

"In recent years, The Post has lost subscribers and revenue, as readers and advertisers have turned to other media -- chiefly, the Internet -- for their news and information," the story added. "Though washingtonpost.com is among the most popular news sites, and is profitable, it still accounts for only about one-fifth of the ad revenue generated by the newspaper."

The story reported that Kaplan "is now growing at about a 20 percent annual clip, as the company has diversified far beyond SAT test-preparation."

Keller, in comments to the American Journalism Review last March, offered his assessment of the Post along with comments about other national rivals. In the AJR story, he added, "the reality they're dealing with is that it's not really a journalism company"; rather, the Post "is one of the properties that the Kaplan Co. owns," and is "certainly under a lot of pressure." Its talent is getting "picked away from outside."

The Post Company's other assets include Cable One, a small cable television system that generates 15% of company revenue dollar; six television stations (8%), Newsweek magazine and Arthur Frommer's Budget Travel magazines (6%), Slate.com, and several smaller newspapers.

"In 2008 and going forward, The Washington Post Co. is going to be an education and media company," Graham said in prepared remarks, the Post reported. "And this absolutely does not mean, nor will it mean in the future, that The Washington Post and Newsweek mean less to me and this company than they once did."

"In the short term, the company's rebranding probably will have more symbolic than material meaning," the Post reported. "Company officials believe The Post Co. will not be viewed differently by Wall Street, partly because Kaplan's rise within the company has been recognized for some time. Also, The Post Co. is more diversified than other education companies, and may not be covered by the same analysts."

But Graham's speech today adds, "It is likely that, in percentage terms, The Washington Post Co. of the future will be more an education company than a media company."

In his speech, Graham also will tell shareholders that "we have been and will continue to be cutting expenses at the newspaper," while adding, "we may spend more than most similarly situated companies to try to produce results in new journalistic media that are appropriate to The Washington Post."