“When you get larger, you get challenged by more forms of media competition for advertising delivery,” he said last week at an investor conference. “Anybody who really focuses on the newspaper business should be studying one company this year: Berkshire Hathaway.”
At Buffett’s Omaha paper, Kroeger is investing in high- definition video equipment, with an eye toward doing an online sports show featuring its reporters. That’s something major market newspapers such as the New York Times and the Wall Street Journal have tried. Unlike those national publications, though, Buffett’s newspapers embrace a simple tenet: All news is local.
“The community aspect of what we do is so important,” Kroeger said. “Obituaries, for example, are huge. You want to find out how big a deal that is? Misspell somebody’s name in an obituary -- once. You’ll never do it again. These things matter to people.”
Filling Gas
Kroeger’s first job at the paper was as an assistant purchasing agent. He negotiated for newsprint costs from vendors and made sure the company’s trucks had enough gas to make their deliveries every day.
“I was pretty low on the food chain,” he said. “It’s where I learned about the nuts and bolts of the business.”
Buffett is a longtime investor in newspapers, though never at this scale in the past. Buffett’s interest in the industry had been mostly limited to a stake in the Washington Post and the 1977 purchase of the Buffalo News, which is run separately from Kroeger’s operations. Its publisher, Stan Lipsey, reports directly to Buffett. Berkshire also owns a stake in Gannett, the publisher of USA Today.
Buffett is the second-richest American, after Microsoft Corp.’s Bill Gates, with an estimated worth of $46.7 billion, according to the Bloomberg Billionaires Index. That’s made him one of the highest-profile backers of print journalism.
More Deals?
“I’ve loved newspapers all my life -- and always will,” Buffett wrote in a letter to employees of his newspapers earlier this year, before going on to say that he will probably buy more papers over the next few years. Buffett’s office didn’t respond to a request for comment.