Washington Post 2004 Annual Report Download - page 10

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THE WASHINGTON POST COMPANY 8
Cable One came through fine. After gaining a few thousand subscribers in 2003
when we elected not to raise basic rates, we lost about 10,000 in 2004 when we
raised rates by $2 per month. We won’t raise rates in 2005.
As to telephone companies, their better-marketed high-speed offerings (though much
slower than Cable One’s) improved their market share, but Cable One responded
effectively. At year-end, no telephone company was offering fiber to the home or video
service in a Cable One market.
Satellite broadcasters and telephone companies have formed effective partnerships to
sell dishes and high-speed data service. But RBOC announcements of planned video
service have turned the partners into future competitors.
And then there’s Kaplan.
Ten years ago, Kaplan’s revenues were 3% of The Washington Post Company’s; last
year, they were 34%. That percentage should increase for the next few years.
Kaplan is an old story, and the two-pronged story is:
1. We were incredibly lucky, and
2. If you have a good business, management is 90% about choosing the right people.
Kay Graham and Dick Simmons made a wise decision to acquire Kaplan in 1984, but
for the next ten years, we struggled to find the right team to run it, with poor results.
TEN YEARS AGO, KAPLAN’S REVENUES WERE 3% OF THE WASHINGTON
POST COMPANY’S; LAST YEAR, THEY WERE 34%.