Commentary

Will Arc Publishing Become More Valuable Than 'The Washington Post'?

The Washington Post's digital content platform, Arc Publishing, licensed its technology for the first time to a company outside of the media industry: energy giant BP.

The deal may be an early indication that Arc Publishing can become a more valuable business than the newspaper for owner Jeff Bezos, the Amazon founder who bought WaPo for $250 million in 2013.

BP's communications team will use Arc's platform to publish videos and articles among its 250 internal websites, which are used by more than 70,000 employees in 70 countries, the newspaper announced in a blog post.

“Arc allows our comms professionals to concentrate on producing that content, rather than navigating multiple publishing systems," says Geoff Morrell, global head of communications and external affairs for BP. "What’s more, its flexibility fits perfectly with our write-once, publish-anywhere strategy for digital publishing.”

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Since WaPo started licensing the technology in 2014, Arc has primarily focused on the needs of newspaper publishers. Arc's clientele has expanded to more than 600 websites worldwide, including those run by The Boston Globe and Raycom Media. 

Arc's competitors in publishing technology include WordPress.com and Vox Media.

This month, WordPress's parent company, Automattic, raised $300 million from tech giant Salesforce.com.

Vox, which yesterday announced the acquisition of New York magazine's publisher, New York Media, licenses its Chorus platform to various media outlets, such as The Ringer.

Shailesh Prakash, WaPo's Chief Information Officer and vice president of product development, touted Arc's technical prowess in the newspaper's blog post.

Arc combines "the publishing expertise of The Washington Post and is deeply integrated with advanced capabilities from Amazon Web Services," he said, referring to Amazon's cloud computing business.

Arc currently isn't profitable, he told Bloomberg News, but the company expects its yearly revenue to reach $100 million in the next three years. That would make Arc a third major source of revenue, aside from advertising and subscriptions. 

Of course, the $100 million figure has been cited for years as a goal, if a 2016 report by the Columbia Journalism Review is any indication. As a privately held newspaper, WaPo doesn't disclose earnings and sales figures.

However, if Arc can continue to sign up non-media clients like BP, I wouldn't be surprised to see its revenue surpass WaPo's advertising and subscription sales.

That's because Bezos has considerable experience in selling technology to other businesses.

Under his leadership, Amazon has built its cloud computing service into a highly profitable business that's on track to surpass $30 billion in revenue this year. Amazon Web Services generates more than half of Amazon's $3.1 billion in operating income.

WaPo's Arc Publishing can become a key value-added service for Amazon's cloud computing clients, while generating healthy licensing revenue for the newspaper.

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