Succession

Last Tuesday’s libel settlement began the media industry’s week of terror that ended Monday with the ignominious firings of cable news anchors Tucker Carlson and Don Lemon, along with the sad resignation of Jeff Shell, CEO of NBCUniversal , over the weekend.

Carlson’s release was as predictable as it is surprising. The record-breaking $788m Dominion Voting Systems setback gives Fox’s leadership ample air cover to dump their once-glittering star back into the know-nothing strand of journalism from whence he came.

But Tucker Carlson swallowed the hemlock for Fox on March 7, 2023, when he aired excerpts from an extra 41,000 hours of Jan. 6 security footage, exclusively received from the Speaker of the House, Kevin McCarthy.

Carlson’s Leni Riefenstahl imitation was too good.

Rupert Murdoch has a breaking point. No newsman can abide a reporting assignment gone that far afield.

While he allows divergent political opinions to masquerade as entertainment, anti-democracy misinformation that can be easily proven false is verboten by the News Corp coda.

When he saw Carlson's March 7 episode, former President Trump claimed it had “irrefutable” evidence that rioters have been wrongly accused of crimes. He thanked both Carlson and McCarthy for their brave work.

Carlson began last week with a lengthy, two-part interview with Elon Musk about the dangers of artificial intelligence. On Friday's last show on Fox News, he claimed for Fox News the second-largest audience on cable television for the day, with 2,600,500 Americans tuning in to learn and be entertained.

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"Learn from me, if not by my precepts, at least by my example, how dangerous is the acquirement of knowledge and how much happier that man is who believes his native town to be the world, than he who aspires to become greater than his nature will allow."

Mary Shelley – from the novel “Frankenstein”

History is His Story

I recall distinctly three moments from the most cosmic business meeting of my career. It was February 2013, and my acquisition company had recently purchased Freedom Communications Inc. the parent company of the Orange County Register , in a private equity transaction.

Just after lunch, we drove an hour from the OCR building in Santa Ana to the Fox Studios lot in Century City. We were two fresh, young media moguls, headed to see the big guy. Somehow, we got ourselves a private audience with Rupert Murdoch.

We didn’t know what to expect, but it seemed like they were waiting for us to arrive. The gate attendants pointed to the nearby white office building and told us to park out front.

Two nice older women met us at the front of a second-floor office suite. Within a few minutes, Rupert Murdoch came in softly, smiled, and offered a warm hand of welcome to each of us. He was surprisingly engaging and interested in our story.

He drew the shades in his well-appointed office and told his assistant not to bother us. Trying to avoid the awkward pause, I began by suggesting that we were three of the only people in the world who believed in the future of print media. "Let the meeting begin," I said.

Rupert chuckled, and then he opened up to us like he was a friend’s dad showing off his toys. He unveiled pictures of his soon-to-be-purchased vineyard in Bel Air and regaled us with colorful stories, full of names we knew.

One Rupert tale has become a favorite to retell, the Power Rangers deal with Haim Saban, the media impresario and longtime contributor to Democratic causes and candidates. In 1997, the two men formed an investment consortium that leveraged Saban’s assets to acquire the TV Family Channel, a cable network owned by televangelist, Pat Robertson. The debt heavy transaction was worth $1.9 billion.

The agreement between the acquiring parties was complex. Each owned a roughly 50% stake in the deal, and shrewdly, Saban got the right to “put” his shares back to Fox at the then-market price, any time within five years of the original acquisition.

When News Corp. tried to buy DIRECTV from 通用汽车 in early 2001, Saban recognized a squeeze opportunity. He would exercise his put, thereby forcing Fox to buy him out before the market for cable channels cooled even further.

Rupert got wind of Haim’s plot, so he invited the self-styled “cartoon schlepper” to a friendly lunch at the commissary on the Fox lot. After a few minutes of social conversation, Rupert popped the question. “So, Haim, I understand you’d like us to buy back your position. Do you have a price in mind?”

“Yes,” said Haim. “I think the whole package we own together is worth more than $5 billion to the right bidder.”

“In today’s market? You think the price went from $1.9 billion to $5 billion in four years in a declining market,” replied Rupert. When Haim nodded, Rupert got up to take a stroll.

When the second-generation media mogul sat back down, he reached his arm around Haim, looked in his eyes, and said, “at that price, I’m a seller with you. Let’s go sell this thing.”

And they did. In October 2001 the Walt Disney Company bought the Fox Family Channel for $5.2 billion. They renamed it the ABC Family Channel, and then it became the Disney Channel . Haim Saban purportedly made $1.5 billion on his half of the transaction, and News Corp got a much-needed cash infusion.

Between 2000 and 2002, the Nasdaq lost 67% of its value (4,069 to 1,335). The Dow Jones Industrial Average lost 27% of its value (11,497 to 8,341).

My third memory came from an early part of our two-hour journey through media history. We were discussing the typical newspaper owner’s conundrum. Most of the journalists on his payroll are trained to be unbiased reporters of the news. Like lawyers, the facts are their gods.

Only a small section of a daily newspaper, perhaps just a page, is dedicated to the house opinion. That’s called the opinion page, and it’s the only place to provide your news brand to your news readers.

Then, we began discussing the media’s influence over the recent 2012 presidential campaign. Like now, the Democrats controlled the Senate and the Presidency. The Republican party was in disarray, after losing decisively recently.

I asked Rupert if he thought Fox News had an unusually large influence over the Republican party.

He answered with a smirk, “Can you imagine where the Republican party would be without Fox News?” ?