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April 29, 2017

Fox News, 2017, Post-Election, What Will the Murdochs Do?

Is it too early to move on 2017? While the number 24 – as in 24%, the odds of Donald Trump winning the Presidency according to The New York Times’ Upshot forecasters — sent a chill down the spine of many, it still looks like the likelihood is that Hillary Clinton will move into the White House, again.

We now know that it won’t be Roger Ailes directing Fox coverage of the new political world if and when she does; though it’s not official, even the Murdoch family’s Wall Street Journal is presently reporting his imminent ouster.

First published at Politico Media

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Perhaps Rupert will throw him a “senior advisor” role, as Ailes exits, stage right. Rupert sticks by his loyalists to the bitter end, removing them only when his own family’s fortunes are truly threatened. The British newspaper hacking scandal, its handling and its aftermath, including the eventual rehabilitation of News Corp exec Rebekah Brooks, best illustrates both Murdoch’s extreme loyalty and willingness to do whatever he needs to make sure his empire strikes back successfully.

Yet, this long overdue passage of 76-year-old Roger Ailes from his red, white and blue Fox stage comes at an unprecedented time of transition all around the mighty institution he built from scratch, the Fox News Channel.

We can mark three transitions of this time.

Ailes’ own departure — and the question of who, long-term, will replace him — is top of mind.

Second is the big opportunity the lawsuit of Ailes accuser Gretchen Carlson’s (why isn’t she running the Republican National Convention?) offers Murdoch’s sons. As James and Lachlan dig into the real power of running the company, they now find themselves in actual control of FNC, which Ailes had run as a renegade operation.

Third, we can consider whatever becomes of the Republican Party and The Right, after a Trump loss.

It’s a political-business Möbius strip of unending potential configurations.

A Roger Ailes–run Fox would likely have applied the same, highly successful playbook — hateful Hillary, business as usual — come January. Hire Mike Pence, reprising the Sarah Palin, Rick Santorum and Mike Huckabee roles, as Pence becomes the (silver) heir apparent for the out-of-Presidential power party. Pick up the three best lines of Hillary attack, tested by Donald Trump, and plan to stir the ratings pot for the next four to eight years — when Ailes would have been 84.

Now, though, the door is open Fox News Channel re-invention, as the iron-clad grasp of Ailes is forcibly removed.

It’s near-certain that the workplace atmosphere at Fox will change. That now seems inevitable, with Murdoch history here too, showing the likely way forward. Two years ago, when Rupert dispatched Dow Jones CEO Lex Fenwick, his new appointee cleaned up the joint. While the public complaints about Fenwick’s two-year-tenure centered on mismanagement of the business overall and on his strongman leadership style (do we see a pattern here?), many subterranean complaints focused on the workplace.

Fenwick’s window out into the office, the Journal’s survivors and departed told me, included a bevy of the company’s most attractive women. Overall, the atmosphere, between the ogling and the authoritarian style, created a poor, if not hostile, workplace.

Upon arrival, fixing that workplace became CEO Will Lewis’s first priority, and, by most accounts, he’s normalized it.

That’s the no-brainer for James and Lachlan, two modern men of the world, we’d believe. Their choice of Ailes’ replacement will tell whether they apply the Journal’s good lesson. (Here, we can only root for the unorthodox pick of Megyn Kelly, and await the delight of her going up against Jeff Zucker’s CNN forces. Hell, with the way the country is going, that could be a preview of the 2020 Presidential election.)

The tougher issue is Fox and its future. As a $1-billion-a-year cash elephant for 21st Century Fox, it presents a conundrum: How do keep pumping the profits as the world, and its audiences, change around it?

Consider that the average Fox News Channel viewer is 68 years old, and getting a year older each year. Bill O’Reilly’s audience: 72! This is a crowd — by no coincidence, demographically similar to much of Donald Trump’s base – that needs to be milked. The Murdochs need to keep monetizing it, via cable fees and advertising, through the version of Fox News that Ailes built.

At the same time, they can look at the data — presumably more their bailiwick, now, than Rupert’s — and see the issues FNC faces with 25-54-year-olds. Yes, we know that 2016 has been a boon year for Fox, and CNN, with even MSNBC reversing a long slump. But, 2017, that’s another question entirely.

Will Roger Ailes’ twin pursuits of power-brokering and profit-making fit so neatly together into the next decade? Will the cable news business — oh-so-slowly being disintermediated by digital (and mobile) video — maintain its margins, as the audience ages out? With Ailes gone and the next Murdochs in charge, those are the real questions they face, whether they fully appreciate it yet or not.

Finally, who can map the political landscape going forward, assuming that (perhaps historic) Trump loss? Hillary Clinton’s negative–positive ratio would presumably return the historic 50/50, as it does for most presidents. After eight years of hating Obama, faced with the generational “loss” of the Supreme Court and further loss after loss on social tolerance issues (on which the right has long lost, looking at attitudes by generation), it is actually conceivable to imagine Clinton Fatigue. Sure, that may be premature, but much of the emotion of 2016 may well be spent.

There’s no doubt that cable will experience a significant audience drop-off from this year’s Trump high. As the Republican Party likely searches for its future (parlor game: do it without mentioning the words “Paul Ryan”), the Murdoch scions may well — unexpectedly — have been forced to reimagine the Fox News that Roger Ailes built. The task they thought would come later has come sooner.

 

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