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Practice Tests, Not News, Bring in the Big Bucks for the Post
With readership dwindling, the Post’s educational division, Kaplan, now generates most of the company’s revenue.
It’s official: The Washington Post Company now gets more than half of its revenues from teaching people how to take tests, not from providing them with news. The company founded as a home for a Washington daily newspaper is now mostly an educational enterprise.
The Post reports in its latest financial statement that Kaplan, its educational division, brought in 50.3 percent of the company’s revenues. The newspaper division, essentially the Post, brought in 21 percent of revenues. The rest came from cable-TV systems, television stations, and Newsweek magazine.
The latest financial report spelled out bad news for Newsweek, where revenue has dropped 16 percent from last year. That’s probably why Graham has dispatched trusted lieutenant Ann McDaniel to help manage the New York–based newsweekly.
The Post’s Kaplan division is providing the financial base from which Graham can expand into the Internet. It also allows him to keep investors at bay.
By contrast, the Sulzberger family has no non-newspaper profit center to buttress and protect the New York Times.
The Post bought Kaplan in 1984 when Richard Simmons was company president. Simmons is credited with making the initial foray into education—even after an "I don't care" type of reaction to the move from Don Graham's mother, Katharine Graham, then the head of the Post Company.
This article originally appeared in the December 2007 issue of Washingtonian Magazine.