- Cable chief built channel into company’s top profit source
- Fox News Channel leads all pay-TV outlets in viewers this year
21st Century Fox Inc. plans to remove Roger Ailes, the chairman and chief executive officer of Fox News who has been accused of sexual harassment by former anchor Gretchen Carlson, according to New York Magazine.
Fox Co-Executive Chairman Rupert Murdoch and his sons James and Lachlan have agreed that Ailes should depart, though they haven’t settled on the timing or terms of his exit, the magazine reported, citing people it didn’t identify. Fox responded by saying its review of the accusations isn’t complete.
Ailes’s firing would be a stunning fall for one of the most successful media consultants and TV executives of the last half-century. The former adviser to Richard Nixon and Ronald Reagan teamed with then-CEO Rupert Murdoch to found the Fox News Channel in 1996, and built it into one of the most profitable properties in all of media.
Fox News Channel ranks as one of the highest-rated cable networks, and is a huge source of profit for the parent company. 21st Century Fox’s cable networks, led by the news channel, accounted for about half of the parent company’s revenue last year and more than two-thirds of operating income.
Ailes, 76, was sued for alleged sexual harassment by Carlson, who claimed she was fired in June for refusing his advances and complaining about his conduct. The allegations prompted 21st Century Fox to begin an internal review. Her accusations were followed by published claims from several other women, all of which allegedly occurred before the Fox News Channel began airing.
“This matter is not yet resolved and the review is not concluded,” 21st Century Fox said in an e-mailed statement.
Fox shares were little changed in New York. While Ailes is inextricably linked with Fox News in the mind of most media observers, it’s difficult to imagine his departure would lead to a dramatic change of course for the network that draws so many viewers and makes so much money.
What’s more, Ailes has taken a lower profile in recent months because of poor health, according to a person with knowledge of the matter who asked not to be named discussing internal matters. Top executives running Fox News include Bill Shine, senior executive vice president of programming, and Michael Clemente, the executive vice president for news specials.
“There must be zero tolerance for even the appearance of impropriety in every large media company. The Murdochs’ hands are tied,” said Laura Martin, a Needham & Co. analyst who follows Fox. “Losing Roger Ailes is an operating negative. This just accelerates the succession issues.”
Ailes has denied Carlson’s allegations, and claimed she spoke out only after she was fired by the network. He has tried to move the suit to New York from New Jersey and is seeking arbitration.
“When Fox News did not commence any negotiations to renew her contract, Ms. Carlson became aware that her career with the network was likely over and conveniently began to pursue a lawsuit,” Ailes said in a July 6 statement. “Ironically, Fox News provided her with more on-air opportunities over her 11-year tenure than any other employer in the industry, for which she thanked me in her recent book.”
Several Fox News personalities, including Maria Bartiromo, Sean Hannity, Greta Van Susteren and Bill O’Reilly, voiced their support for Ailes in the days after the harassment suit was filed.
Ailes started Fox News at the behest of Murdoch, creating an alternative to more liberal competitors. While Fox News has been criticized for its partisan programming, it has used controversies such as the fight between anchor Kelly and presumptive nominee Donald Trump to build ratings. The network also draws a distinction between its opinionated prime-time programming, and more news-oriented shows during the day.
Fox News has been buoyed by record audiences during the primary season, momentum that’s expected to continue with the presidential candidacy of Trump, a real estate mogul and TV host. This year, Fox News is leading all basic cable channels in prime-time and total-day viewership for the first time in the network’s history. Fox averaged 2.18 million viewers a night in prime time through midyear, compared with 1.16 million for Time Warner Inc.’s CNN.
Uncertainty about Ailes’s future at Fox started last year after the elder Murdoch named his son James CEO and Lachlan co-executive chairman. The appointments led to confusing statements over whether Ailes would continue reporting to the elder Murdoch. Ultimately the company said he would report to all three.