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Summary:

Warren Buffett will keep the Buffalo News and a stake in the Washington Post Company (NYSE: WPO) — but won’t play white knight for the news…

imageWarren Buffett will keep the Buffalo News and a stake in the Washington Post Company (NYSE: WPO) — but won’t play white knight for the newspaper industry. The billionaire financier told shareholders at the Berkshire Hathaway annual meeting taking place today in Omaha, Neb., that newspapers face possible “unending losses” and that the company would not buy most U.S. newspaper “at any price,” according to MarketWatch and WSJ.

Buffett also spoke of how newspapers once had been essential to readers — and thus to advertisers — but that was no longer the case. But what of Berkshire’s current holdings?

Buffalo News: He said the paper is working with unions on a new business model.

WaPoCo: Buffett, who is on the Washington Post board, spoke of its attractive businesses — singling out cable — but said “does not have answers to the problems of the newspaper business.”

Twittering from the stage: The NYT’s Andrew Ross Sorkin, one of the journalists participating in the Q&A at the meeting, twittered live from the stage via BlackBerry, with the feed running in a widget on the DealBook blog. His take on the newspaper discussion: “Buffett says newspaper biz is no longer “essential” sigh. tho he’s not selling washpo or buffalo news.”

Update: Fox Business News anchor Liz Claman has this exchange with Buffett and his business partner Charlie Munger:

Question: At what price does it become compelling to invest in newspaper business or is there no price in today

  1. Matt Paust Sunday, May 3, 2009

    Tragedy? This from a hard-nosed capitalist? I wouldn't expect a business type to appreciate the irony of debasing "tragedy" in his world, unless he's being sarcastic, but to use his sentimental pap to hed this blog post is shameless pandering.

    It worked, tho. Got me to click it open. Snort…

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  2. Matt Paust Sunday, May 3, 2009

    Ooops, wrong blog. Mea culpa. (I'm just learning the ropes at Romanesko.)

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  3. Yea, it's really national tragedy :(

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  4. Only a tragedy if you will miss the blatant left-leaning rags that have deserted their readers.
    Only a tragedy if you will miss the blatant right-leaning rags that have deserted their readers.

    I have only have one word for the people whining about newspapers dying: Schumpeter. (cf. http://en.wikipedia.org/wiki/Schumpeter)

    Find a new business model.

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  5. Yes. Charlie Munger is right. It is a tragedy. And I do not see the professionalism of newspapers in their heyday in what purports to take their place. The problem is this: The internet has the capacity to create advertising inventory virtually out of thin air. It is destroying every advertising business that depends on scarcity of inventory for survival. I don't like it. When pushed to the edge, businesses will do many things otherwise abominable to survive. As for the internet, its infinite capacity to create inventory is also the seed of its own destruction. With an infinite supply, it is next to impossible to protect a price.

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  6. I disagree with Charlie Munger. It will not be a tragedy that newspapers will be gone and they are irreplaceable.

    Already replacements are beginning to merge. The biggie of course is Matt Drudge. I get more information from him than I do the other rags. Other models are emerging (Craigslist, Ebay) that are replacing bits and pieces of newspapers. Its hard to predict the next model that will emerge just as it was hard to predict the impact of the telegraph, telephone and the teletype.

    That's hard for Mr. Munger and Mr. Buffett they need to invest in something right now not 2 years from now. The public thinks that Berkshire Hathaway is in venture capital but its major function is investment capital only. Right now there is nothing on the street to buy that suits Messrs. Buffet and Munger. All that money is burning a hole in their pockets and shareholders want a return on investment right now.

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  7. jack is back! Monday, May 4, 2009

    Stuck in the 70's just like the Administration. Time to move on and embrace the new technologies and the 21st century. Future shock wave was about 3 years ago. Didn't you feel it, Warren?

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  8. Compelling content carves out a space on the internet. This is not infinite but requires talent and skill. It attracts readers and thus should attract advertisers. It is a good thing that merit, not geographic control or market power, will attract readers and related ad dollars (or other currency depending upon where one is).

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  9. I wonder if the real reason that the entire newspaper industry has lurched so far to the left in the last few years is that conservatives started to abandon the industry when it was clear that the industry was a few years from death.

    Thus abandoning the dying industry to liberal concerns willing to run it at a loss due to the political power the industry wields.

    I think that it's pretty clear that once the newspapers shut down, liberals will lose their premier voice. Liberal talk radio is a failure and they are losing in the television news market. They are matched evenly on the internet. It's only newspapers where liberals dominate and control the narrative, and they have been bleeding red ink doing so.

    I think that the most important thing we can do to save our Republic is to ensure that the newspaper industry is allowed to die its natural death, and doesn't survive as a zombie state propaganda machine, like NPR.

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  10. Interesting theory, jms.

    Forces driving newspapers to irrelevance also affecting education, as online access to information and educational software threatens traditional institutions of learning.

    Perhaps conservatives have fled the university because it, too, is a few years away from death.

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